In the last two weeks, we’ve talked about the different parts of planning for business succession.  In our first article, we talked about the operational preparations that must be made (read the article here).  Then last week, we started discussing the financial implications of business succession, including valuations of the business and any real estate interests (read the article here).

In our final piece of business succession planning, we’ll talk about financing of the ownership transfer. There really are only a few options.  New buyers come up with the cash to pay the heirs, old owners finance the transaction over a specified period or new buyers get a bank to finance the transaction. As you have now grown to expect from me, this is not something that you want to figure out after the fact. Get this documented today with the facts and circumstances of today.  These facts and circumstances may include the interest rate environment, the borrowing capacity of your new owners, your heirs needs for liquidity, death taxes that may be payable, existing bank loans on the business or the real estate and anything else that may complicate the financial succession.

Part of the reason so few owners have this problem is neglect from their team of outside professionals. Every one of them is extremely busy in their own world and claims they do not have the spare time to attend to some of these issues that are non-core to their own silo businesses.

Accountants claim they are too busy doing accounting and taxes to devote dozens of hours to some of their best clients on what may really be their single most important and urgent issue. Lawyers claim that they are ready to draft whatever documents that Mr. Business Owner needs to complete the plan, but they don’t have the time to devote dozens of hours walking through the nitty gritty.  This story holds true for most financial planners, insurance agents, money managers, and any other suit that has ever been in your office.  Most have an idea as to what needs to be done, but as long as they meet their own firm’s objective by selling you a line of credit or retirement plan services, they’ve done their job.

If you want help to get through this, we can help.  If you think you can go at it alone, please get started as soon as tomorrow!

Napier Financial is an independent full-service wealth manager and a fiduciary.  We act as a financial “head coach”, overseeing and managing all facets of our clients’ financial lives, including succession planning and business owner retirement planning.  Interested in learning more?  Reach out to Alex Weiss at or 781.884-2356.

John P. Napolitano CFP®, CPA, PFS, MST is Founder and Chairman of Napier Financial in Braintree, MA.  Visit for more information. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. Investment and financial planning advice offered through US Financial Advisors and Great Valley Advisor Group,  Registered Investment Advisors.

By John P. Napolitano CFP®, CPA, PFS, MST Founder & Chairman Read More