Succession Plan Start-Up: An 18-Point Checklist

Evelyn Jacks

A financial plan matters, a lot.  Yet, close to 50% of Canadians don’t even have a budget. Further, only about 30% of Canadians knew what a financial plan is and how it could help them. That means there is a lot of potential for collaboration to get better financial results and achieve more financial goals.

Business owners fare better on this front:  in the U.S., 70% of business owners have a business succession plan in place, although half of these folks are concerned about their successor’s ability to grow the business for the long term. Worse, 60% believe the business transition will result in family conflict.

This is especially important in the current environment.  In facing uncertain tax and economic times, including fluctuating interest rates, supply chain interruptions and volatile returns in the financial marketplace, setting financial goals more formally will serve your family well. 

Consider a new “start-up” in your financial life. Check off the elements of a “Financial Care Plan” below:  how much of it do  you have assembled? It’s worth the effort to pull it together and execute on it, no matter how busy your life is.

FINANCIAL CARE PLAN START-UP:  AN 18-POINT CHECKLIST

• A personal net worth statement for each member of the family
• Tax returns that are up-to-date
• A debt management plan that is up-to-date
• Legal documents:prenuptual agreement, a will, power of attorney, executor, health care directive
• Life insurance: for each family member and the business
• Disability insurance, group health and travel care plan
• Property insurance: for home and business
• Privacy and fraud insurance:personal and business
• Investment Policy Statement: How to accumulate and grow wealth
• Plan for income: how to preserve income and capital from tax
• Tax efficient transfer of assets - during your lifetime and at death
• Retirement plan: how to de-accumulate with tax efficiency
• A Buy-sell Agreement with business partners
• Family conflict resolution policies
• Business succession plan
• Strategic philanthropy plan
• End of Life Plan – Executor and Funeral Arrangements in place
• Annual Family Vacation Plan

The last point  – the Annual Family Vacation Plan – is REALLY important – for bonding and memory-building,  as well as a time out to reflect on your priorities for now, and after, when you leave your efforts and your instructions to your heirs.

Bottom Line:  Whenever you take on the responsibility for a consistent and reliable financial result, you need a framework to make decisions within, and a way to account for and measure success.   Leaders who strive to achieve results at work or in sport know the process well.  Yet so few follow through on this, when it comes to planning their personal affairs.  What’s the common link?

Quite simply, it’s the ability to make sound decisions together, with your advisors and your family, so that everyone on the wealth building team are on the same page.  This requires all the things leaders a great at:  strategic goal setting, a solid Plan A to execute on together, and an even better “Plan B” that anticipates what will happen if “Plan A” veers off course.   

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