The phrase, “Exit Strategy” connotes the culmination of a job well done, and the beginning of a time to reap the rewards of your large effort! It may also increase one’s anxiety about what’s next, or what will life look like going forward?
“We don’t plan to fail, we fail to plan”! Having a plan for your “Exit Strategy” makes it a lot more secure, and inspires much greater confidence in the outcome. A very successful and proven tool to use in implementing an “Exit Strategy” is a Permanent Life Insurance Policy. Life insurance is not just a Death Benefit to your heirs! It can be used to:
- Buy out inherited partners,
- Compensate key employees,
- Cover the expense of finding, attracting and hiring a replacement for the former key employee,
- Continuing the long range development program jeopardized by the loss of a key employee,
- Assure creditors and customers that the business will continue, and
- If funded correctly, can provide tax free retirement income!
If you double bonus the premium payer the business can deduct the cost of that coverage as a business expense. You need to double bonus them so that one half will cover the taxes on that bonus, and the other half will pay the premium of the policy. But, by doing this the cost is covered by pre-tax money, that comes off the bottom line before you have to pay taxes.
If I can assist you in creating an “Exit Strategy”, please contact Corrin Trowbridge at ctrowbridge@farmersagent.com, or 650-876-9600
