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  • jfoxcpacfp jfoxcpacfp 
    Moderator
    Status: Financial Advisor, Accountant, Small Business Owner
    Posts: 8130
    Joined: 01/09/2016
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    Do business owners include their business value in NW calcs?

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    That is an excellent question. Definitely, they should. The intrinsic value of a business is part of the retirement plan for many business owners. Those who plan to walk away (i.e. have no succession plan) should not include the value in their net worth, as there is none. But I always recommend that small single owner businesses have a succession plan in place via grooming successors. Not easy and really requires planning ahead but definitely a valuable exercise.

    Partnerships should have a buyout calculation in the partnership agreement, making valuation easier. This is one of the few areas that cash value life insurance can make sense.

    Johanna Fox Turner, CPA, CFP, Fox Wealth Mgmt & Fox CPAs ~
    http://www.fox-cpas.com/for-doctors-only ~ [email protected]

    #204811 Reply
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    Avatar rmecc001 
    Participant
    Status: Physician
    Posts: 23
    Joined: 02/03/2016

    What I mean is accounts I plan to spend before FI/retirement. My kids will be out of college before I get to FI

    #206157 Reply

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