Core Wealth Management

SUMMARY

After 30 years of running a successful construction firm, Bob and Sue, both in their early 60s, were ready to step away from their business and transition into early retirement. They sought help clarifying their financial picture, minimizing taxes, and creating a reliable income plan. Despite strong profits, they faced uncertainty about the value of their business, how to structure a tax-efficient sale, and how to transition into retirement.

Through a comprehensive planning process, we provided a certified business valuation, implemented a tax-saving retirement plan, modeled various sale structures, and developed a cash flow and investment plan to fund their cash needs, including health insurance, throughout their retirement years.  

Now, Bob and Sue are confidently moving toward retirement with a clear, tax-smart strategy, a premium-ready business, and peace of mind about their financial future.

SPECIFIC GOALS

• Exit the business on their terms and with confidence that the transaction would be structured appropriately and that they would be compensated fairly for the value of the business 
• Have a retirement plan in place that addressed how their cash needs would be met once the business was sold
• Minimize lifetime tax exposure
• Simplify and consolidate investments

CHALLENGES

Despite strong profits, Bob and Sue were experiencing burnout and growing uncertainty about their future. They had yet to determine the true market value of their business or whether the proceeds from a potential sale would be enough to support more than 30 years of living expenses, including healthcare. They were also unsure how to structure the sale in a way that would minimize taxes, how to efficiently draw income from their mix of taxable, tax-deferred, and Roth accounts, and how to shift from running a business to managing the financial complexities and risks of retirement.

ANAYLSIS & SOLUTIONS

We began by listening closely to Bob and Sue’s concerns and then translating those into a set of clear financial goals. Bob and Sue engaged our firm for a comprehensive financial planning and investment management solution. Our planning process included:

• A professional business valuation clarified their company’s fair market value.  We reviewed the valuation and helped the client identify and pursue strategies that aligned with the findings, contributing to an estimated 10% increase in value over an 18-month period
• Installation of a 401(k) + cash balance plan to increase pre-sale deductions by over $120,000 annually
• Tax modeling of multiple sale structures (stock vs. asset sale; lump sum vs. installment) that showed a potential 15% reduction in federal tax liability
• Development of an investment strategy that consolidated scattered accounts into a low-cost, tax-efficient portfolio
• Design of a “bridge paycheck” strategy to cover living expenses to age 65 using after-tax reserves
• Review of healthcare options, including ACA plans, HSA bridge strategies, and group plan conversions to prevent unexpected coverage gaps
• A month-by-month action plan to guide them through the transition while keeping them focused on enhancing business value

OUTCOME

The solutions we implemented gave Bob and Sue the clarity and structure they needed to move forward with confidence. 

• We fully separated their business and personal finances, allowing them to clearly see their post-sale net worth. 
• We established a flexible 24-month exit window, giving them the freedom to sell sooner if the right buyer emerged. 
• By proactively structuring their retirement and the eventual sale of the business, we projected a reduction in their lifetime tax exposure by approximately 15%. 
• Their investments were consolidated into one broadly diversified, tax-efficient portfolio aligned with both their risk tolerance and long-term goals.
• We developed a cash flow plan that provided Bob and Sue with clarity on how their cash flow needs would be met throughout their retirement years.

As a result, Bob and Sue now feel empowered and optimistic about their next chapter. With a tailored action plan and timeline in place, they no longer worry about what comes next and continue to run their business on their own terms, knowing their financial future is secure.

Your Fee-Only Financial Advisor

Individuals and families seeking a champion for their personal wealth need possibilities and opportunities, guided by readily accessible expertise.  Instead they often encounter boundaries and limitations.  As a Registered Investment Advisor firm with a fiduciary obligation to our clients, Core Wealth Management is a fee-only firm; our sole source of compensation is from our clients, in the form of flat-fees, hourly fees or a percentage of assets under management.  Our services and fee structures are flexible and transparent, structured to meet your financial means and needs.  

LEARN MORE

Your Fee-Only Financial Advisor

Individuals and families seeking a champion for their personal wealth need possibilities and opportunities, guided by readily accessible expertise.  Instead they often encounter boundaries and limitations.  As a Registered Investment Advisor firm with a fiduciary obligation to our clients, Core Wealth Management is a fee-only firm; our sole source of compensation is from our clients, in the form of flat-fees, hourly fees or a percentage of assets under management.  Our services and fee structures are flexible and transparent, structured to meet your financial means and needs.  

LEARN MORE