Securing The Future – Effective Succession Planning Strategies

With an ageing population and an ever-increasing number of middleaged Australians starting to think about retirement, it is critical that they also start to think about a topic that many feel uncomfortable with, succession planning.

It is a topic that is sometimes seen as uncomfortable to talk about because it pre-supposes one of the two certainties in life, death and taxes. It doesn’t have to be that way.

A good succession plan isn’t just about having a Will or transferring wealth and assets after death, it is a plan for the orderly transfer or wealth and assets to the next generation of family members to help them build upon your legacy.

There are no hard and fast rules to follow, but those families who start planning earlier typically experience better outcomes. Why? Because there is more time:

• More time to prepare their plan
• More time to implement
• More time to develop the skills of successors, and
• Finally, more time to see through the implementation and benefit for the next generation.

A good succession plan sets up you and your family with the best chance of success to achieve your goals as you transition your wealth to the next generation.

Modern families come in many shapes and sizes and as a consequence succession planning strategies vary.

There are many different factors to consider when developing your plan, many of which will be unique to your personal circumstances. Some of those factors include:

• What type of assets do you have? For example, businesses, passive investments, real estate, etc
• If you have a family business, does the next generation want to be involved in leading that business or do they want to pursue other ventures?
• Do you and the next generation of family members have similar financial values and goals?
• Is there a commonality or agreement between family members on how assets should be distributed and transferred?
• How large is your family, will your wider family receive benefits or only your children and grandchildren?
• The stage of life and age of the next generation of family members. For example, are some members early in their career while others have young families?
• Are all family members of sound mind and body? Do any have special needs?
• Is it a blended family and if so, what are the expectations of the different family members?
• Where are family members located? Are there foreign tax and estate laws that need to be considered?
• Are there any pre-existing family tensions?
• Have you previously supported some, but not all, family members financially?
• How to minimise the tax burden so my family receive more of my wealth?
• Where does philanthropy fit in the succession plan?

Knowing where and when to start is daunting, but a trusted advisor can add value to your succession planning, help guide you through the process. We are here to help. No matter what stage you are up to, we can help you navigate the complexities with your succession planning.

• Start aligning financial values and goals among family members
• Develop talent to move into key management roles within a business
• Enable family members or external parties to raise capital to buyout business and investment assets
• Invest in the future of family members. For example, provide funding to invest in a startup, buy a home
• Provide mentoring to the next generation to make wise investment decisions.

Want to know more about how Bentleys can help you?

Contact Bentleys today for a consultation with one of our expert tax advisors who can offer tailored advice specific to your industry, business structure, and growth ambitions. With the right strategic tax partner, you can turn tax management from a necessary obligation into a competitive advantage. We’re here to help you get where you want to be.

Disclaimer: This information is general in nature and should not be relied on as advice. It does not take into account the objectives, financial situation or needs of any particular person. You need to consider your financial situation and needs and seek professional advice before making any decisions based on this information.