CNC shop owners are famous for putting a tremendous amount of time, money, thought and perspiration into starting and running their business. Unfortunately, many are also notorious for neglecting to plan for retirement. According to financial experts, about 1/3 of small business owners don’t have a retirement savings plan.
There are a number of reasons why this true:
- Believing that retirement planning can be put off until a more convenient time in the future. We often learn too late that the future arrives much more quickly than we imagined, and without proper planning, a comfortable retirement may not be feasible.
- Putting every dollar back into the business. Of course you must invest to sustain and grow your shop. However, along with a realistic capital investment plan, establish a sound retirement plan. Diversity is the key. Just as financial planners advise clients to have a mix of investments (stocks, bonds, etc.), in addition to your business investment, you should put money into SEP-IRAs or other retirement vehicles.
- Assuming that selling the business will take care of your retirement. Certainly, we all hope to reap the benefits of the hard work we put into building a company. However, not having a viable succession plan, good financial records and the right business structure could make it difficult to successfully sell. In addition to getting all of your business issues positioned to appeal to a potential buyer, set up a financial plan that doesn’t depend on selling the business to fund all of your retirement plans.
- The “I’ll never retire” mindset. Even if you love what you are doing, none of us can depend on continued good health, predict changes in the industry and/or markets we serve, or fully anticipate disruptive events beyond our control. Better to have an exit strategy in place if needed.
Gosiger is happy to help you get the best return on your investments in manufacturing technology and related services. We also want you to be successful in planning your retirement or other exit strategy. That’s why we make available a free e-book on the subject. You can download it by visiting www.Gosiger.com. To learn more about Gosiger products and services, contact your local Gosiger facility.