This is often not planned out, and the surviving co-owner ends up working with the spouse or other heir of the partner. This is not usually the ideal situation.
A legal contract between 2 or more co-owners that guarantees a price and a buyer if something were to happen in the future.
Without having a buy-sell in place, these are the issues that come up.
-How much is the company worth?
-Formulaic vs Process
-Have a valuation expert help and update the agreement over time as the business grows and changes (every 2–3 years)
-How is the agreement going to be funded?
-4 Ways to fund (can be done in combination):
-Take into account future projections of the business when getting funding together to ensure you have enough if/when the time comes.
-Two main types
Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Gold Family Wealth, LLC), or any non-investment related content, made reference to directly or indirectly in this newsletter will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this newsletter serves as the receipt of, or as a substitute for, personalized investment advice from Gold Family Wealth, LLC. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Gold Family Wealth, LLC is neither a law firm nor a certified public accounting firm and no portion of the newsletter content should be construed as legal or accounting advice. A copy of the Gold Family Wealth, LLC’s current written disclosure statement discussing our advisory services and fees is available upon request. If you are an Gold Family Wealth, LLC client, please remember to contact Gold Family Wealth, LLC, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services.
Stress Testing: Are you 100 percent sure everything in your financial and wealth plans will deliver as promised?