After years of long, hard work you may have decided to sell your business to venture out to other opportunities. Now that you've sold, you are tasked with figuring out what to do with the profit and what to do now that you don't have your business. Keep reading to learn what to do after you sell your business.
Your Income From The Sale
Some business owners receive enough income after the sale of their business to sustain themselves for the rest of their life. A post-sale strategy that can be helpful is to put a significant amount of money from the sale in pre-tax accounts and convert those into Roth IRAs. Each year that you convert your money into a Roth IRA, you can prevent reaching the higher income tax brackets.
Create A Charitable Donation Strategy
Creating a donor-advised fund can handle charitable contributions for several years. One tactic called charitable bunching can allow the owner to make a significant donation in the year of sale. You don't want to necessarily spread out your donations because the donation is more valuable in the year of sale. A large donation of hundreds of thousands of dollars will offset income taxes from the sale.
Make Sure You Have Health Insurance
You may have had your health insurance go through your business's employer-sponsored plan. Since you may be selling before the age of 65, you will not qualify for Medicare, the main health insurance for retirees. First, see if your spouse's employer has a health insurance plan that you and your family could utilize. If this is not an option, you'll need to look for insurance on the open market. Utilize a health insurance broker to take a look at different plans that work best for you and your family.
Decide How You Want To Spend Your Time
After selling your business, you can feel lost trying to decide what to do with your time. Now that you do not have your business anymore, what are you going to do to fill your days? Whether it's taking a well-deserved vacation, picking up a hobby, or starting a new business venture, it is important to decide how you will spend your time.
If you are in the process of selling your business or recently sold your business and need direction, our advisors at Genesis Financial Group are here to help. We can assist in minimizing your taxes, deciding how to spend your money, and laying out your new chapter in life. Give us a call today to get started.