Many people focus on their personal assets when they are creating an estate plan. They don’t realize that people who have family businesses, including farmers, should have a comprehensive estate plan that sets out what will happen to the business.
One thing that no business owner should ever do is to overlook the importance of the estate plan. If you don’t have one in place, the state’s laws will dictate who gets what. This might not be anything close to what you want to happen. In fact, it could mean that your family loses the business completely.
As part of your estate planning, you need to designate someone to have your power of attorney for financial matters. This person will make decisions for your business if you are unable to do so yourself. They won’t hold any power while you are alive and able to make your own decisions, so don’t think that establishing this means that you are giving someone else control over the business now.
You should have a succession plan in place so that there is someone to fill your shoes with the business after your death or when you can’t run it any longer. By making the decision about your successor now, you have time to train that person on how to run the business.
It is always best to have more plans than what you think you might need. When you think about your estate plan, make sure that you make decisions that take care of your family members and any employees that count on your company for their income. Setting up a personalized plan is beneficial for everyone.