With the familiar pattern of some form of a global crisis almost every decade, what should business owners be thinking about when it comes to the concept of income replacement of their business before this decade is over? This week on Build Value By Choice Nana is joined by Brian A. Trzcinski, Director of Business Market Development at MassMutual to discuss these critical topics around making sure your exit strategy is not just beneficial for your business, but beneficial for you too.

 

KEY TAKEAWAYS
Income replacement value is about what the business owner needs the business to be worth in order to maintain the current lifestyle they have built for themselves when they retire.
Income Replacement Value Valuation Method (How much will I need. Take the Personal value you receive in terms of compensation and other benefits and apply a recap value percentage to it, say 3/4/5%). Market Value Valuation method (Earnings * Multiple (Affected by things you can’t control such as: your industry, overall economy & capital markets and some things you can control (8 drivers))). Income replacement is about what the owner needs the business to be worth versus what they think it's worth.
An Exit Planning Institute survey stated that 70% of businesses never make it to market. Of the 30% that do, only 16% are actually able to be sold. Of up to 250,000 businesses that are going up for sale, only about 15,000 of them are going to sell at the prices that the business owner set out to get at the beginning, all the rest are not going to even make a due diligence, or they're going to sell with some concessions.
According to the 2018 MassMutual Business Owner Perspectives Study, 10% of businesses say they don’t ever plan to exit. 66% say they don’t know all of the available exit options. 13% of business owners sought business valuation to know if the value is sufficient to fund their retirement. Nearly half of the business owners surveyed don’t think about retirement or can’t imagine ever retiring. 70% have no idea when they will retire.
26% of owners surveyed stated that their source of retirement income will either come from the sale of their business or the income from their business. However, in reality, three out of four business owners have less than $500,000 saved in their retirement accounts. That means business owners are underestimating their financial reliance on the business post-retirement. Many may be forced to rely on the proceeds from the sale of the business or continue to receive income from the business to fund their retirements.
According to the 2017 Exit Planning Institute Survey, 72% of business owners don’t believe their exit will impact their lifestyle.

 

BEST MOMENTS

 

‘I knew a business owner who ran expenses through a personal credit card and the rewards earned paid for a family vacation every year’ 

‘We call this the keep or leave decision’ 

‘If you’re not thinking about it already you don’t want to wait for the next crisis to come around’ 

 

EPISODE RESOURCES 

 

Leave a comment or question on the Build Value By Choice Facebook community page

Get more resources on https://infhorizons.com/podcast

Connect with Brian on Linkedin

Don’t forget to subscribe to the podcast and share it.

 

PODCAST DESCRIPTION

 

Hosted by Nana Bonsu of Infinite Horizons, this show aims to serve small business owners who want to grow their businesses while reducing their own personal involvement. We do this through a combination of interviews with industry leaders, and host presentations. We are a certified value builder advisors and leverage a statistically proven methodology to help clients such as you scale or transition their business to the next chapter.

We care for our listeners and see their dreams as our own. We aim to foster a community that embraces freedom, generosity, and integrity. This is a show by entrepreneurs and business owners for entrepreneurs and business owners.

 

ABOUT THE HOST

 

Nana Bonsu:

“I am an entrepreneur and ex-Corporate Executive who's applying his experience and knowledge from working in various to pursue my passion of helping small business owners increase their choices in life by leveraging my knowledge and experience, their employees, systems and money. I help small business owners transform their business and increase value through action-oriented education and implementation of strategies and tactics to make their business sellable even if they are not planning on selling. Known for establishing an environment for personal growth and development. My multicultural background equips me with the intuitive understanding of different cultures and how they impact business owners.”

infhorizons.com

Infinate Horizons on Facebook

 Follow Nana on Instagram

nbonsu@infhorizons.com

Nana on LinkedIn

facebook.com/nmbonsu

Infinite Horizons, Inc. on LinkedIn

 

With the familiar pattern of some form of a global crisis almost every decade, what should business owners be thinking about when it comes to the concept of income replacement of their business before this decade is over? This week on Build Value By Choice Nana is joined by Brian A. Trzcinski, Director of Business Market Development at MassMutual to discuss these critical topics around making sure your exit strategy is not just beneficial for your business, but beneficial for you too.
&nbsp;
KEY TAKEAWAYS
<ul>
<li>Income replacement value is about what the business owner needs the business to be worth in order to maintain the current lifestyle they have built for themselves when they retire.</li>
<li>Income Replacement Value Valuation Method (How much will I need. Take the Personal value you receive in terms of compensation and other benefits and apply a recap value percentage to it, say 3/4/5%). Market Value Valuation method (Earnings * Multiple (Affected by things you can&rsquo;t control such as: your industry, overall economy &amp; capital markets and some things you can control (8 drivers))). Income replacement is about what the owner needs the business to be worth versus what they think it's worth.</li>
<li>An Exit Planning Institute survey stated that 70% of businesses never make it to market. Of the 30% that do, only 16% are actually able to be sold. Of up to 250,000 businesses that are going up for sale, only about 15,000 of them are going to sell at the prices that the business owner set out to get at the beginning, all the rest are not going to even make a due diligence, or they're going to sell with some concessions.</li>
<li>According to the 2018 MassMutual Business Owner Perspectives Study, 10% of businesses say they don&rsquo;t ever plan to exit. 66% say they don&rsquo;t know all of the available exit options. 13% of business owners sought business valuation to know if the value is sufficient to fund their retirement. Nearly half of the business owners surveyed don&rsquo;t think about retirement or can&rsquo;t imagine ever retiring. 70% have no idea when they will retire.</li>
<li>26% of owners surveyed stated that their source of retirement income will either come from the sale of their business or the income from their business. However, in reality, three out of four business owners have less than $500,000 saved in their retirement accounts. That means business owners are underestimating their financial reliance on the business post-retirement. Many may be forced to rely on the proceeds from the sale of the business or continue to receive income from the business to fund their retirements.</li>
<li>According to the 2017 Exit Planning Institute Survey, 72% of business owners don&rsquo;t believe their exit will impact their lifestyle.</li>
</ul>
&nbsp;
BEST MOMENTS
&nbsp;
&lsquo;I knew a business owner who ran expenses through a personal credit card and the rewards earned paid for a family vacation every year&rsquo; 
&lsquo;We call this the keep or leave decision&rsquo; 
&lsquo;If you&rsquo;re not thinking about it already you don&rsquo;t want to wait for the next crisis to come around&rsquo; 
&nbsp;
EPISODE RESOURCES 
&nbsp;
Leave a comment or question on the <a href="https://www.facebook.com/infinityhorizonsinc">Build Value By Choice Facebook community page</a>
Get more resources on <a href="https://infhorizons.com/podcast">https://infhorizons.com/podcast</a>
Connect with Brian on <a href="https://www.linkedin.com/in/brian-trzcinski-664a4628/">Linkedin</a>
Don&rsquo;t forget to subscribe to the podcast and share it.
&nbsp;
PODCAST DESCRIPTION
&nbsp;
Hosted by Nana Bonsu of <a href="https://infhorizons.com/">Infinite Horizons</a>, this show aims to serve small business owners who want to grow their businesses while reducing their own personal involvement. We do this through a combination of interviews with industry leaders, and host presentations. We are a certified value builder advisors and leverage a statistically proven methodology to help clients such as you scale or transition their business to the next chapter.
We care for our listeners and see their dreams as our own. We aim to foster a community that embraces freedom, generosity, and integrity. This is a show by entrepreneurs and business owners for entrepreneurs and business owners.
&nbsp;
ABOUT THE HOST
&nbsp;
Nana Bonsu:
&ldquo;I am an entrepreneur and ex-Corporate Executive who's applying his experience and knowledge from working in various to pursue my passion of helping small business owners increase their choices in life by leveraging my knowledge and experience, their employees, systems and money. I help small business owners transform their business and increase value through action-oriented education and implementation of strategies and tactics to make their business sellable even if they are not planning on selling. Known for establishing an environment for personal growth and development. My multicultural background equips me with the intuitive understanding of different cultures and how they impact business owners.&rdquo;
<a href="https://infhorizons.com/">infhorizons.com</a>
<a href="https://www.facebook.com/infinityhorizonsinc">Infinate Horizons on Facebook</a>
&nbsp;<a href="https://www.instagram.com/nbonsu1/">Follow Nana on Instagram</a>
nbonsu@infhorizons.com
<a href="https://www.linkedin.com/in/nanabonsu1/">Nana on LinkedIn</a>
<a href="https://www.facebook.com/nmbonsu">facebook.com/nmbonsu</a>
<a href="https://www.linkedin.com/company/74310405/">Infinite Horizons, Inc. on LinkedIn</a>
&nbsp;

This show aims to serve small business owners who want to grow their businesses, while reducing their own personal involvement. We do this through a
combination of interviews with industry leaders, and host presentations. Your Host Nana Bonsu is a certified value builder advisor, who leverages a
statistically proven methodology to help clients such as you scale or transition their business to the next chapter.
We care for our listeners and see their dreams as our own. We aim to foster a community that embraces freedom, generosity, and integrity.
We strive to overdeliver every week and look forward to engaging with you on our various platforms. Nana's approach is to help the business owner see
their business from an external observer perspective when it comes to where they should best focus their strategy and time to maximize value and ensure
the "sellability" of their business to gain peace of mind.
The show is a mix of the host sharing his opinions and interview episodes for business owners generating up to 10M in annual revenues. This show will
be your weekly ace of inspiration and ideation.
Whether you want to sell your business, pass it down to the next generation or just grow the value of your business asset for the future, this podcast
will equip you with ideas to capture the following outcomes and benefits:
- increase your cash flow, minimize or eliminate stressful periods of low cash flow, and increase the overall value of your company.
- increasing both the number and quality of recurring revenue streams flowing into your business.
- minimize your reliance on any one employee, customer or supplier.
- identify areas where additional training, systems or processes are needed to allow your company to operate without you.
 
At Infinite Horizons, Inc. our value-add is helping you with DISCIPLINED ACTION, HIDDEN VALUE & IMPEDIMENTS DISCOVERY, CLARITY OF VISION.
We work with you to protect your business against the 5 Ds – Divorce, Disability, Death, Disagreement, Disaster.

You, the owner, are equipped to build value. The question is are you?

This show aims to serve small business owners who want to grow their businesses, while reducing their own personal involvement. We do this through a combination of interviews with industry leaders, and host presentations. Your Host Nana Bonsu is a certified value builder advisor, who leverages a statistically proven methodology to help clients such as you scale or transition their business to the next chapter. We care for our listeners and see their dreams as our own. We aim to foster a community that embraces freedom, generosity, and integrity. We strive to overdeliver every week and look forward to engaging with you on our various platforms. Nana's approach is to help the business owner see their business from an external observer perspective when it comes to where they should best focus their strategy and time to maximize value and ensure the "sellability" of their business to gain peace of mind. The show is a mix of the host sharing his opinions and interview episodes for business owners generating up to 10M in annual revenues. This show will be your weekly ace of inspiration and ideation. Whether you want to sell your business, pass it down to the next generation or just grow the value of your business asset for the future, this podcast will equip you with ideas to capture the following outcomes and benefits: - increase your cash flow, minimize or eliminate stressful periods of low cash flow, and increase the overall value of your company. - increasing both the number and quality of recurring revenue streams flowing into your business. - minimize your reliance on any one employee, customer or supplier. - identify areas where additional training, systems or processes are needed to allow your company to operate without you. &nbsp; At Infinite Horizons, Inc. our value-add is helping you with DISCIPLINED ACTION, HIDDEN VALUE &amp; IMPEDIMENTS DISCOVERY, CLARITY OF VISION. We work with you to protect your business against the 5 Ds &ndash; Divorce, Disability, Death, Disagreement, Disaster.
You, the owner, are equipped to build value. The question is are you?

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