Business Owners/Entrepreneurs

You may have started with a dream, a passion, and a smart business plan. You devoted your time and energy, made countless sacrifices, and nailed down the investments that helped you grow. Your business has taken off and is doing well.  Congratulations — you’ve arrived! 

A business is a huge factor in complicating your wealth, so when you get answers, you want to be able to see where they are coming from and what they are going to do for you. We're upfront about our fees and processes so we can get you answers you can take at face value, which will help you clarify your plans for your business and worry less about preparing for retirement.

With such an intense focus on your business, you may have delayed making plans or decisions around your personal financial situation. Here’s how we can help you catch up:

Business Owner Case Study >

The Situation:
A semi-retired 59-year-old business owner came to us in 2009 to discuss his full retirement challenge.  He had an $825,000 qualified account from which he was withdrawing $3500 per month.  He was also earning $2300 pretax from the family business.  His portfolio was split approximately 50/50 between fixed income and equity.  He was planning on retiring completely in four years, at which time he would draw an additional $3000 per month from his portfolio - total of $6500/mo.


Here is the Math:
He was withdrawing 5.1% of his portfolio annually and planning to withdraw 9.45% of the current portfolio value starting in 4 years.  The long-run rate of return for the U.S. stock market is 10%, with the return on bonds approximately 6%.  So, a 50/50 mix of stocks and bonds should return about 8% annually, or 5% if you assume a 3% inflation rate, leaving him only 17 years before he ran out of money.


Our Solution:
Since he wanted to retire in four years, we explained his risk tolerance would have to increase to achieve the targeted return needed for retirement.  We told him to reduce current withdrawals by $500/mo., dropping the yearly percentage to 4.36%.


Fast Forward 3 Years:
The client was able to retire in four years.  His withdrawals of $6,000/month are only 3.54% of the portfolio (vs. 4.36% originally.) His assets will now last until 90 years of age with funds to use or leave as a legacy to his family or others.