Wealth Management is commonly thought of as an advisory service for personal finance and investment. While this certainly is an important role for a Wealth Manager, what can sometimes be overlooked is how they can also benefit business owners, not only with their personal finances, but with their business position, succession and exit plans, and employee benefits.

For many business owners, their company will form an integral part of their retirement plans. This is why working with a Wealth Manager in all aspects of financial planning, both business and personal, is beneficial for business owners. In this article, we will look at the different areas a Wealth Manager can advise business owners on, and the value they can bring to your business.

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Providing the full picture for you and your business’s finances and tax

A Wealth Manager can work with you in assessing you and your business financial position and advise on the best investments, allowances and tax relief options to take.

Cash flow and inflation

Maintaining a balance in your corporate accounts can be a challenge for any business owner. But, with the dramatic increase in inflation, coupled with greater staffing and business expenses, cash flow and the value of cash assets has become a key concern for many business owners. In a high inflationary period, holding large cash balances can result in devaluation of the cash asset in real terms. However, there are investment options that could be effective at weathering the negative effects of inflation, while producing income through interest payments.

Pensions and tax relief

If you own a limited company, you can pay an employer contribution into a pension plan as an allowable business expense. Pension contributions receive corporation tax relief. As an employer, you also don’t need to pay National Insurance on pension contributions, so if you pay directly into a pension, rather than paying yourself the equivalent in salary, you can save 13.8% – the National Insurance rate for the 2022/23 tax year – with an additional 1.25% on earnings above the Secondary Threshold.

Business Protection

Long-term financial planning for your business should include some form of protection for your business finances in case of any unexpected challenges your organisation may face. There are a number of business protections available to business owners. Yet, according to a large insurance provider, more than half of UK SMEs have no relevant cover in place. For SMEs, where financial or employee disruption can have a significant impact on the organisation, business protections can provide critical relief.

Key person, income, shareholder and business loan protections, as well as critical illness and life plans, are important to consider as a business owner. A Wealth Manager can suggest the  most appropriate protection and life plans available on the market for you and your employees.

Business exit planning and estate planning

For business owners, planning how to exit your business will often go hand in hand with your retirement plans. Yet, only 4% of business owners in the UK have a formal plan for life after leaving their business. This is perhaps not surprising given the energy and focus business owners invest in their business. Nevertheless, planning for your future beyond your business is vital so you can afford the retirement you want and protect your estate for your loved ones. For this reason, the earlier you start planning your future and business exit the better.

A Wealth Manager can work with you to establish a clear Life Plan that includes your business and personal wealth. This may involve planning for a reduced role in managing your business, or selling the business entirely. A Wealth Manager can advise you on the best options for funding your retirement through assessing your potential income against expenditure, considering investment options from the sale of a business, as well as effective and tax-efficient ways to pass on your wealth to your loved ones.

No matter what current or future plans you have, a Wealth Manager can help you reach your financial goals to secure both you and your business’s future. By gaining a clear and comprehensive understanding of your business alongside your personal finances, a Wealth Manager can help you to create a Life Plan that drives all of your finances, assets and investments in the same direction.

PLEASE ALWAYS REMEMBER: Grosvenor Wealth Management Ltd is authorised and regulated by the Financial Conduct Authority. The value of investment can go down as well as up and you may not get back the original amount you invested. Tax treatment is dependent on individual circumstances and may be subject to change. Tax planning is not regulated by the Financial Conduct Authority.


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