Recently in our blog, we talked about business partnerships between siblings. As a follow-up to that post, we wanted to discuss business partnerships between parents and their adult children, too.
Many who own and operate companies in the Northeast (Massachusetts and New Hampshire, for example) want to have their children take over at some point. In some cases, parents assume their kids are on board with this unspoken business succession concept. Sometimes, children do want to take over the family business. Other times adult children may desire an entirely different future.
Discuss the idea with your kids
Instead of assuming your grown children share your ideas, ask them what they want. Sitting down with your kids and having an adult conversation about the family business often gives you a way to assess their interest in taking over. Taking this step could save you a lot of trouble when it is time to formalize your business succession plans.
Create an official partnership
If your children show interest in operating the family business one day, consider creating a formal business partnership between you and your children (or child). Doing this can make it easier when it comes time to pass on the business.
Choose another succession option
If your kids do not seem interested in taking the reins after your discussion, you will have plenty of time to make another plan for your company’s future. You could look for a different family member to take the reins, arrange to sell the business or look for a non-related party interested in stepping into your shoes.
In any case, exploring your options before your retirement can offer security about your company’s future. For more topics like this, we invite you to continue exploring our legal blog and website.