According to a news release, the survey of small to medium sized business owners with two to 500 employees found two-thirds (66%) do not have an exit plan to transition their business in the event of death, disability or retirement. Instead, owners focus on growing their business (70%) followed by achieving business stability and remaining active in the business after retirement (both 47%).
“Many owners said their retirement plan is to never retire, while others plan to fund retirement by selling their business,” said Steve Parrish, national advanced solutions consultant for the Principal Financial Group, in the release.
The findings also indicate business owners’ stated priorities often do not match their actions. Health insurance was the top priority for business owners, yet more than half (58%) do not currently offer this benefit.
Business protection followed in importance, but according to the survey, six out of 10 (61%) do not have plans in place to help them protect their business in the case of death, disability or termination of key employees. Retirement plans came in at number three, yet only about one in five (19%) offer a 401(k) plan to employees.
“The economic environment highlights the importance of preparing for the unexpected. While it’s understandable individuals will focus on the short term now, they need to make time to plan for their future so they can protect their business and meet their financial goals,” said Parrish.
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