Buying or Selling a Business or Planning an Exit Strategy - Situational Financial Planning, Legal & ID Shield, Halifax, Nova Scotia, Canada

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Buying or Selling a Business or Planning an Exit Strategy

Financial Plan
Succession or Exit Planning
(or buying a business)
J. Paul Wilson, CFP, CHFC

"You have to do it by yourself and you cannot do it alone."
                         - Martin Rutte (Author, speaker)

Your unique plan.

Buying or selling and business succession (Exit) planning involve a variety of business and personal issues which need to be considered together. Every plan is unique therefore, it’s important to develop your plan in consultation with collateral professionals and for to understand how it the pieces your puzzle fit together. (Choosing your financial planner)

An overview of business succession follows.
Many small business owners do not have a business succession plan in place leaving them unprepared for retirement, disability and death. Business succession is really an extension of your personal estate planning, but with a focus on the future operations of your business. Planning for retirement, planning for your heirs (in and out of the business), your employees upon your death, and planning for the person who takes over the reins of your business are closely tied together. However, your planning objectives in each of these situations may be different. A business succession plan determines how your business will be transferred to others and outlines the steps necessary to prepare for the transition.

Your EXIT Options
Six key steps
Every business and personal planning situation is different. Every succession plan is also different. Taking the time to think through these six key steps will help you start you your business succession plan. Your financial planner can help you work through these steps.
1.  Assess your current situation
Determine the potential of your business if you were no longer there to run it and consider the steps that would be required to maintain profitability.
2.  Understand your goals for your business and family
Consider what business succession plan will be best for you and your family. What does a successful retirement mean to you? Is it your goal to have a family member continue to own and manage your business or perhaps own the business with outside management assistance? What is fair and equitable? How much control do I want to retain after I retire? You might wish to sell your business to key employees or a third party. Or, it may suit you better to sell parts of the business or liquidate the business assets.  
3. Identify and prioritize your action plans
Work with your professional advisors to determine what must be done in order for your business succession plan to proceed and succeed. Where will the money come from to fund the purchase of my business and fund my retirement?
4.  Select your best action plan and set time table
With help from your Financial Planner and Chartered Accountant, from the various alternatives considered, select the plan that best meets your objectives.
5.  Document your decisions
Put your business succession plan in writing and forward it to your professional advisors to review, adjust and file it for safekeeping.

The small businessman must plan ahead.... Otherwise the business will die when he does”
            - John F. Bulloch, former Chairman of the Board of the Canadian Federation of Independent Business

6. Implement and monitor your plan

Many parts of your plan will likely not need implementation for many years. However, some items may require immediate attention – insurance coverage to fund a buy-sell agreement, training of a successor in key business areas and introducing the successors to key suppliers and contacts, and/or updating wills and buy-sell agreements.

The consequences of no succession planning for your business can be quite dramatic for your retirement, your heirs, your legacy and your business.
Getting Started

Take time to go through the following checklist.  

Make sure you consider every point. Each consideration is important in helping your advisors properly structure a business succession plan that meets your goals for both your family and your business.


  • Are new family members or other individuals becoming increasingly involved in the business?

  • Has your spouse taken on a more active role?

  • Have your children become involved?

  • Do you have a successor manager in place should you suddenly die or become disabled?

  • If one child receives ownership in the business, what assets will your other children receive?

  • Do you have other assets worth sufficient value to do this?

  • How will your spouse be looked after once your child takes over the business?

  • Will having your child take control of the business impact the business profitability?


  • Has your business structure changed since you last reviewed your will?

  • Is your business more or less profitable than when you last reviewed your will?

  • Have new partners or shareholders come onboard?

  • What are the futures prospects for your business?

  • Will internal or external events affect future profitability?

  • Do you plan any expansion?

  • Are there major obstacles or threats on the horizon?

  • Will you receive a retirement income from your business?

  • Will you sell the company when you retire?

  • Will you sell it to a family member or to a third party?

  • Do you play to stay actively involved in your business when you retire?

  • Do you want to maintain ownership to provide income during retirement but not stay actively involved?


  • Have you made out a will?

  • Do you need to revise your will?

  • Has your personal situation changed?

  • Have you had children since it was last revised?

  • Have you married or become divorced?

  • Have any of your children married?

Insurance planning

  • Have you recently reviewed your insurance program with your financial  security advisor?

  • Are you prepared in the event of premature death?

  • Disability?

  • Critical illness?

  • Has the value of your business changed significantly since you put your plans in place?

  • Has your successor owner changed since the above plans were created?

Tax Strategies

  • Does your business qualify for the Enhanced Capital gains Exemption?

  • If not, are there any adjustments you can make to your business to qualify?


Paul is a Certified Financial Planner (CFP) licensed by the Financial Planners Standards Council; Financial and Estate Plans are provided under that license.

The information contained in this website is intended to provide general guidelines only. The application and impact of the law can vary widely from case to case based on the specific or unique facts involved. Accordingly, the information in this article is not intended to serve as legal, accounting or tax advice. Users are encouraged to consult with their professional advisers for advice concerning specific matters before making a decision.

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J. Paul Wilson, CFP®, ChFC®
Certified Financial Planner
27 Blue Thistle Road Halifax, Nova Scotia, B3S 1M3
Office (902) 405-8665 Email
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