UBS Wealth Way Corporate succession: giving your life’s work a future

Forty years ago, Jonathan put all his eggs in one basket and took over a small sole proprietorship from his former employer. Since then, he has turned the small bricklaying business into a general construction company with 55 employees. As fulfilling as this “work” has been, he usually put his private needs second – as well as those of his wife Amy (62), who did the bookkeeping. Extensive traveling has so far remained an unfulfilled dream for the couple. That’s about to change. “We should create more free time for ourselves and cut back professionally,” think Jonathan and his wife.

Their son Benjamin (25) is studying medicine, so getting involved in the family business is out of the question for him. The situation is different for daughter Jamie (27): she studied architecture, completed internships in the industry – and now wants to offer consulting services for industrial buildings. The family has not yet talked about a succession solution in detail. Both parents and children are aware that external support would be useful for this.

During a comprehensive discussion between company manager Jonathan and his UBS client advisor, the following important values for a succession solution emerged: jobs should be preserved, his retirement planning protected, and the wishes of his children taken into account. The succession planning now in the pipeline is also based on the UBS Wealth Way advisory approach. This had already convinced Jonathan and Amy at the time because it places their financial goals at the centre of a comprehensive asset structuring and optimization strategy.

“It’s like a construction project. Before we can draw up the plans, we have to evaluate the location,” says the client advisor at the start of the conversation. Together with Jonathan and his family, he analyses the current situation and notes the goals of all those involved. It is necessary to examine all the possible options for corporate succession and to take into account all the conflicting aspects regarding the company’s situation, tax, pension planning and inheritance issues. He calls in UBS specialists to ensure holistic planning over several years.

Jonathan is pleased with the result of the evaluation: the next generation of the family will be taking the helm thanks to Jamie. At the same time, Jonathan will withdraw liquidity from the company in order to find a fair solution for their son, Benjamin.

But how does the succession solution affect the financial situation of Jonathan and Amy?

UBS Wealth Way offers the ideal framework for shaping your financial future. The advisory approach defines the three key strategies of liquidity, longevity and legacy, and coordinates them with different short- and long-term life goals.

Jonathan’s liquidity situation will change once he hands over the company. The funds released as a result will guarantee Jonathan and his wife an “iron reserve”, whilst also covering larger short-term expenses. This will ensure that even in the case of unexpected events, the couple will not get into financial difficulties.

In order to enjoy life after leaving the company and be able to travel, Jonathan and Amy now need a new longevity strategy. In dialog with the client advisor, they develop a suitable investment strategy to finance their retirement. It takes into account not only the couple’s desired standard of living, but also their personal plans for the future.

Following the sale of the company, Jonathan and Amy have considerable means at their disposal to pursue a legacy strategy. “We want to choose the strategy in consultation with our children, because we will be passing this money on to them,” says Jonathan. The client advisor agrees that this makes a lot of sense.

“UBS Wealth Way shows you the route to your goals. And as goals can change, we should regularly check whether we are still heading in the right direction. This means we can always adapt the three key strategies to changing circumstances, if necessary” explains the client advisor.

For now, Jonathan and Amy are relieved that UBS is supporting them in the process of corporate succession – and showing them ways to achieve “great freedom”, as Jonathan puts it.