How to Determine Your Estate Plan & Succession Strategy

Congratulations. You're gearing up to launch a new restaurant or you've got one up and running. The future is bright, and your head is swimming with the day-to-day challenges of running a small business. The learning curve can be steep and the demands intense. Add the pressures of managing a family, a relationship, or just life in general, and your plate is more than full. But it's fun, it's exciting, and it's your dream.

So who wants to consider what will happen to your loved ones, business partners, and your restaurant if you fall out of the picture? No one does. And that's why most folks avoid planning their estates like they avoid root canal surgery. But if you're a business owner, your estate planning issues can get much more complicated, than say, an average Joe or Jane with a house, 401(k), savings account, and life insurance policy to distribute at the end of the road. You are building a business and a potentially valuable legacy for your children and their children. In addition, you may have business partners, fellow shareholders, and associates who count on you and your restaurant in their plans.

Failure to properly address estate planning and business succession matters can cause brutal family squabbles, onerous tax consequences, and forever-lost opportunities to put the right people in place to run the business after your death. It can create unyielding financial hardship on persons who continue the business after your death and, ultimately, can cause the failure of the business you've worked so hard to build. In addition, there have been many lawsuits filed by siblings against siblings, and shareholders against shareholders because of poorly conceived or nonexistent estate planning. Many of these legal battles involve closely held and family businesses. It's a pretty sorry legacy to leave behind, frankly.