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Warner Norcross + Judd LLP is a corporate law firm with over 230 attorneys serving clients in nine offices throughout Michigan. Among the largest law firms in Michigan, Warner works in virtually all areas of business law.

Michigan Law Firm - Warner Norcross + Judd LLP

Part 1 in the&nbsp;Transitioning&nbsp;the Family Business&nbsp;series

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If you have spent your career preparing to take over the family business, it can be frustrating to wait for the senior generation to decide that they are ready to retire. It also may be hard to understand why mom or dad chooses to keep putting in the long hours and would rather deal with the challenges of the business instead of retiring and enjoying life.

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For the next generation, the waiting is even more difficult if your parents have not created a succession plan. This causes great uncertainty regarding the role each person should be preparing for and how a successor will be chosen if a parent passes away without a plan.

Sometimes the wait exists because the parents may still enjoy running the business. They likely are in no hurry to let go of a company to which they have devoted their lives. Or, parents may not wish to deal with the complex emotions, the fear of the unknown or the hard feelings associated with choosing successors. These issues and others can create barriers to planning for a transfer of the business to the next generation.

If you want to help your parents focus on succession, it is important to understand the issues behind their reluctance to do this planning and understand the strategies for addressing them (warning: it might take years). Below are some common issues that our succession planning attorneys, working with the family’s other professionals, help families overcome to begin preparing for ownership transition and creating a succession plan.

Coping With Reasons Why Parents Won’t Leave the Business

They are uncertain about how they can be financially secure away from the business.&nbsp;&nbsp; This one is huge, and succession will not be addressed if this concern is present. However, many options exist to solve this problem, and your wealth advisors and your attorney can certainly help you find one that is right for your family.

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Their identity is tied to the business.

They worry that their life will lack purpose without the business to run. After they have devoted decades to building a business, it may be hard for them to see that they could have an important purpose elsewhere.

They believe successors are not ready to run the business. Find out what their specific concerns are and take steps to alleviate these concerns.

They believe that they are irreplaceable. Some of the strategies mentioned above can help with this concern too. However, this one may be difficult to address without outside help.

They are avoiding hard feelings that will occur in the family when a successor is chosen. This is where a good succession planning attorney or advisor can help your family design a plan that creates a win-win situation for the members of both generations.

They equate retirement with a decline in health or even impending death. Everyone has heard a story about someone who died soon after retirement, and even though this is rarely the case, some people still equate retirement with the end of an active, healthy life.

They fear losing their prestige in the community (the business leader and/or the spouse).

If you are in a waiting situation that appears to have no end in sight, perhaps it is time to engage someone to help you have conversations about the future of the business. Our succession and estate planning attorneys can often facilitate these conversations and help families start planning for a successful business future. If you have questions related to succession planning or transferring the ownership or control of a family business, please contact your Warner attorney or contact Bruce Young at&nbsp;<a href="mailto:byoung@wnj.com">byoung@wnj.com</a>&nbsp;or 616.752.2144.

Legacy Matters

Private Client and Family Office

Of Counsel

Bruce C. Young

Trusts and Estates

Why Won’t My Parents Retire and Let Me Run the Family Business?

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