A proactive approach for a positive future
By Kelly Morgan
“We had avoided discussing our plans for the future – not just the farm, but our own future too. We were concerned about family fighting, so we did the worst thing possible and put our heads in the sand.
Ad hoc planning was putting our retirement at risk and watering down the value of the business. When our son came to us with his concerns about the future, we knew we couldn’t ignore planning our transition out of the business any longer.
Being guided by professionals with a focus on communication, concern about family and business needs and a step by step process has helped us achieve positive results for all.”
There is no silver bullet when it comes to succession planning and every family and farming business will have different needs and priorities. The most important step is to start the process.
Our checklist outlines a proactive approach to planning and implementing the legal arrangements you need to have in place.
Your legal checklist for succession planning success
- Make an obligation-free appointment to start the conversation about your succession planning needs
Does your family need to consider the following:
- Updating family member’s Wills (or putting one in place)
- Securing retirement for the senior generation
- Treating children fairly (not the same as equally)
- Financial arrangements such as pre-nuptial agreements to preserve family wealth
- Considering the potential for divorce (and securing assets prior to this occurring)
- Formalising property settlements for married couples who have separated (tying up “loose ends”)
- Child Support needs
- Adult child maintenance needs
- De facto relationships
- More complex property settlements involving significant wealth, including farms and businesses
- Establishing and understanding the advantages of a Testamentary Trust or alternate business structures for your business
- Making arrangements for disabled family members
- Protecting your succession wishes through Binding Death Benefit Nominations for superannuation/insurance benefits
- Catering for blended families and second marriages
- Protecting assets from children who are bankrupt or have other addictions (such as gambling or substance abuse)
Farming business considerations
Could your farming business benefit from:
- Clear agreements as to how the farming business will be operated (where there are multiple families or generations working together)
- Reviewing your business structure to make the most of available concessions, to protect your assets and to minimise tax obligations
- Family Partnership agreements for working families
- Establishing new agreements/leases including buy sell arrangements, trust deeds, land leases or partnership agreements for the ongoing security of your business
- Self-Managed Superannuation Fund establishment and Wills for greater control in managing your investments (including property)
- Establishing an estate plan in collaboration with your aligned professionals which supports your succession plan, and considers:
– Creating income streams for the retiring generation
– Avoiding exorbitant aged care costs
– Financial security for the next generation
– Considerations for non-farming children
– Reducing tax liability
If you would like the peace of mind that comes from starting your succession planning process, I encourage you to contact us for an obligation free appointment. Our team can outline the process and documentation requirements and answer the many questions you may have.
The first step you need to take is to make a time to have a chat with a solicitor from Kelly Kelly Legal. It’s as easy as that!
We have years of experience helping farming families to achieve proactive succession planning outcomes. Contact the team on 08 8664 1162 or email firstname.lastname@example.org to arrange a confidential meeting today.
Five Steps for Succession Success Articles
Step 1: Setting Expectations – Great expectations I A successful strategy for your family and your business
Step 2: A Structured Approach – Everyone at the table I We thought we were doing the right thing…
Step 3: Identifying Everyone’s needs and concerns – Walk a mile in their shoes I Planning a seamless transition from one generation to the next
Step 4: Strategise – What’s fair is not always equal I Horses for courses
Step 5: Implementation – A positive way forward
Working in collaboration for a number of years, Financial Services SA and Kelly Kelly Legal offer insight and expertise in rural and family farming business succession planning. Accustomed to opening up meaningful discussions, we cut through technical-talk in favour of straight-talk, to offer integrated solutions that consider the often-complex nature of succession plans to incorporate business transition arrangements, wills and estate planning and retirement and superannuation planning.
Financial Services SA is a multi-discipline professional services practice offering farm and business consulting, financial planning, specialist rural finance and mortgage broking. Financial Services SA has a particular interest in developing and implementing practical and achievable succession plans and integrated solutions to consider all aspects of personal, business and farming lives.
The content in this publication and on our website is intended only to provide a summary and general overview on matters of interest. It is not intended to be comprehensive nor does it constitute legal advice. We attempt to ensure that the content is current but we do not guarantee its currency.
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