Wealth Management Reno – Financial Advisor Reno

At Pillar Wealth Management, we can help you figure out the right way to prepare a buy and sell agreement in Reno. We possess over 60 years of combined experience in fiduciary advisory services and assist investors having liquid assets worth $5 million and $500 million in managing their wealth, growing their net worth, and planning for retirement. We have helped numerous high net worth business owners successfully sell their private businesses to maximize their wealth while ensuring their business goes into the right hands. To learn more about what we offer, click here to book a free consultation with us.

In this blog, we will be discussing the potential pitfalls that you need to prepare for when selling your private business and how an experienced wealth management firm can streamline the process.

Table of Contents
The Basics of Buy and Sell Agreements for Private Businesses The Pitfalls and Challenges of Selling a Private Business How Can High Net Worth Business Owners Benefit From Wealth Management Reno? Wrapping It Up

The Basics of Buy and Sell Agreements for Private Businesses

Buy and sell agreements are legally binding contracts that define the terms and conditions guiding the transfer of your shares or business assets to other shareholders of a company or a third party. They are utilized by business owners that want to sell their interest in the business. Some of the typical elements of a buy and sell agreement in Reno include:

• When will the shares/assets/interests be transferred
• Who they will be transferred to
• The price at which they will be transferred

The purpose of these agreements is to enable the smooth transfer of interests or assets while helping the departing owner or shareholder and their family in maintaining their financial security. They also protect the financial health and sustainability of the private business involved.

To learn more about the elements of buy and sell agreements and how they contribute to wealth management and retirement planning, start a conversation with Pillar Wealth Management.

The Pitfalls and Challenges of Selling a Private Business

Selling a private business can be a risky affair for high net worth business owners. For many, it can mean letting go of a steady source of income, risking their financial serenity, and figuring out how to make their wealth last once they hand over their interest in the business to other shareholders or third parties.

It is a milestone in your life. However, does it have to be so stressful and risky? In our experience, no, it does not. With the right strategies, the process can be made much easier while still assuring your long-term financial security. Some of the biggest problems that high net worth business owners face when selling a private business include:

Not Understanding Their Goals

At Pillar Wealth Management Reno, we make it a point to understand the goals of our clients. What do you want to accomplish? What type of lifestyle do you desire? What is the minimum income you need to generate to live comfortably? How much money do you want to leave behind? These questions are not limited to high net worth wealth management. They also apply to buy and sell agreements.

That’s why when we help high net worth business owners prepare a buy and sell agreement in Reno, the first thing we ask them to do is identify their goal behind the transaction. Once you can outline your priorities, your wealth manager can figure out the right strategy for selling your private business so that your financial security doesn’t fall into jeopardy. The same applies to your Company. For instance, if someone from within your family is buying out your business, you need to make the appropriate funding arrangements. Otherwise, it may create too much debt for the Company and impact the net worth of your family. Besides this, when you build up a successful business over the years, you can’t walk away without being assured of its perpetual existence. A robust succession plan needs to be put in place here, and a qualified wealth management firm can make that happen.

The point is that your goals will make a big difference in how you sell your business and how this impacts the new owners. To learn more about the importance of goal setting for high net worth business owners with $5 million to $500 million in liquid assets, click here to read our guide on the 5 critical changes you need to make to achieve financial serenity.

Cash or Stock: What’s The Difference?

There are primarily two modes of payment for selling a business.

1. Cash
2. Stock

It’s important to understand the difference between these two assets and how they impact your financial security after you sell your business. For most high net worth business owners, cash reigns supreme. It is highly liquid and can be quickly diversified through the purchase of other short-term and long-term assets that help you achieve your financial goals.

However, if you own a private business with a net worth of $10 million and above, then an all-cash sale can be difficult. In such cases, the acquiring party is likely to pay you using stock certificates where you get to own a portion of their shares. The value of these shares is equivalent to the price at which you want to sell your business. They can also use a combination of stock and cash.

Now, here’s the problem. Stocks are a volatile asset. Their value can increase and decrease rapidly as per market conditions, and having your entire net worth concentrated into this asset can put you at risk of losing everything you have worked for. A simple solution would be selling a portion of the shares. This can prove to be difficult, though. For instance, if the stocks are restricted under SEC Rule 144-A, then you can resell a certain number of shares within 6 months or a year. However, if the stocks are restricted under SEC Rule 145, then the holding period can last for 2 years.

Therefore, understanding how you are getting paid is vital for wealth management and retirement planning. If you want to learn more about the dangers of concentrated assets and the importance of asset allocation, click here to read our guide on portfolio performance.

Incurring High Tax Costs

One of the first rules of Wealth Management Reno,is to minimize your taxes as much as possible. For instance, when you generate too many short-term capital gains through the sale and purchase of securities, it can lead to a high tax bill that will eat away your income.

A similar rule applies to selling a private business. Depending on the net worth of your business, the income you generate after selling your Company can be subject to a high tax rate. This can significantly reduce your profits and diminish your wealth. At Pillar Wealth Management, we know how to help our clients maximize their benefits and sell their business while reducing taxes as much as possible. Our team can introduce you to a number of tax minimization strategies that can help you out here. If you are worried about the tax bill after selling your business, then click here to start a conversation with us.

Capital gains aren’t the only thing you need to worry about when selling a private business. Different business entities are also taxed differently. For example, the tax rules observed for the sale of a limited liability company are very different from the ones for a partnership or a corporation.

Make sure you understand your Company’s tax structure before you proceed to sell it. A financial advisor Reno that works with high net worth business owners and investors such as yourself can help you out there. To learn about how you can find the right financial advisor for selling your business assets and managing your wealth, click here to read an exclusive guide by Pillar Wealth Management.

How Can High Net Worth Business Owners Benefit From Wealth Management Reno?

Sell Your Business More Securely

Your business is an asset that adds to your net worth. For high net worth business owners, the sale of private business can go a long way in contributing to their wealth management and retirement planning. Unlike standard financial advisors that work with all sorts of private companies, working with a wealth management firm that caters exclusively to high net worth business owners and investors can have its benefits. As discussed earlier, it can help you:

• Manage a goal-oriented transaction that provides you with the financial security you desire
• Avoid the trappings that come with complicated tax laws for the sale of a private business
• Explore strategies for diversifying your assets to avoid a concentrated stock position
• Transfer your assets securely without damaging your net worth or the financial health of the Company

Work Towards Long-term Wealth Management

Once you have managed to sell your private business, you also need to think about how you are going to make your wealth last. A high net worth wealth management firm can help you answer this difficult question. With their assistance, you can optimize the use of your wealth and make critical decisions such as:

• Which type of assets should you invest in?
• What kind of asset allocation is best for your wealth management goals?
• Should you opt for active or passive management?
• How can you continue generating gains and grow your wealth?
• How can you reduce your investment risk?
• How can you maximize performance without compromising your financial security?

Simply put, for high net worth business owners stepping into a new chapter of their life, having the right wealth management firm at your side can help you stress less about your financial security and ensure that your family is well provided for. For families having a net worth of $25 million and above, we also recommend ordering a free hardcover copy of our book – The Art of Protecting Ultra-High Net Worth Portfolios and Estates – Strategies For Families Worth $25 Million To $500 Million.

As our clients will tell you, this book will tell you everything you need to know about high net worth wealth managementand then some more. It will help you understand the underlying benefits of seeking professional Wealth Management Reno, and what it can mean for your financial legacy.

Wrapping It Up

Proper wealth management and retirement planning can offer high net worth investors with the financial serenity they desire to live their life comfortably. If you are ready to sell your private business,consider collaborating with a high net worth wealth management firm such as Pillar Wealth Management.

We work exclusively with business owners and investors have an ultra-high net worth of $5 million to $500 million. Our team can help you prepare a buy and sell agreement in Reno that aligns with your priorities, keeps your costs to a minimum, and capitalizes on the benefits.

We can also create a custom wealth management strategy that increases your net worth over time, makes the most of market trends, and manages your risk.

Remember, you don’t sell a private business every day, so when you do, you must do it right. To find out more about our fiduciary advisory services and how we can help with Wealth Management Reno click here to schedule a free consultation with us.

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