Monday, March 21, 2011

A Bridge to Your Future


Sometimes your career doesn't turn out as planned.  When this happens it's important to have a strategy to 'bridge the gap' to retirement.

Sometimes things don't turn out as planned.  For example, one of the most common situations that clients face is the early end to a career.  Whether through job loss or early retirement or simply because they want a new challenge, many clients need a strategy to 'bridge the gap' between today and their long term plans.

One option that many corporate high achievers choose is to start their own business.  This can be as simple as pursuing your current trade on your own or as ambitious as starting a completely new venture.  Regardless of the type of business, the transition from a corporate environment to the entreprenurial world is one that should be approached carefully.  We believe that there are several key steps that anyone considering striking out on their own should take:

Make Good Exit Decisions - corporations design their benefit packages to get people to stay, not make it easy to leave.  This means that special care must be taken to disentangle your benefits, 401Ks, stock options and other elements in a way that is most advantageous to you.

Conduct a Financial Reality Check - For most people, leaving corporate stability to be self employed increases their risk profile substantially.  This means that all aspects of your financial situation be they estate planning, insurance or asset allocation need to be inventoried, examined and if necessary modified to reflect the changed reality.

Craft a Winning Game Plan - Finally, it's critical that you create a realistic plan that takes into account self employment's less predictable cash flows.  There should be contingencies for the possibility that the new business takes longer to get off the ground or requires more capital that originally planned.

By taking these steps, being methodical and checking your logic with experienced advisors, you can minimize the stress and maximize the freedom that comes from being your own boss.

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