Category: Passive Ownership

Performance Management for Small Businesses: 5 Things Every Owner Needs to Know

by YOUR BUSINESS WORTH, posted in Business Growth and Transition, Company Wealth, evaluations, Income from your business, Key People_Or Group, Passive Ownership, Team, Value drivers

From the Building and Protecting Your Business Worth Broadcast | Guest: Ken Somers

By: Thomas J. Perrone, CLU,CIC

Running a small business means wearing every hat — but one role too many owners neglect is that of a true people manager. On a recent episode of the Building and Protecting Your Business Worth Broadcast, hosted by Thomas J. Perrone of New England Consulting Group of Guilford, guest Ken Somers broke down five critical areas where small businesses can’t afford to fall behind.

1. Performance Management Isn’t Just for Big Companies

Even the smallest teams need structure around performance. Without clear expectations, feedback loops, and accountability, small businesses often lose their best people — or keep their worst ones too long. Performance management doesn’t have to be bureaucratic. Done right, it creates clarity, motivation, and a culture where people actually want to show up and do their best work.

2. Management Succession: Plan Before You Have To

Most small business owners have never thought about what happens if they step away — suddenly or by choice. A basic management succession plan doesn’t require an HR department. It starts with identifying who on your team could step up, what gaps exist, and how you’d develop them over time. Waiting until a crisis hits is the most expensive way to learn this lesson.

3. Rising Healthcare Costs? There Are Smarter Options

Medical insurance is one of the fastest-growing costs for small business owners, and many are still using outdated group plan structures. Two alternatives worth exploring: ICHRA (Individual Coverage Health Reimbursement Arrangement) and QSEHRA (Qualified Small Employer HRA). Both allow employers to reimburse employees for individual health insurance, giving owners cost control and employees more flexibility — without the volatility of traditional group premiums.

4. Every Leader Needs a Coach

Small business owners tend to go it alone. But the most effective leaders — at every level — have coaches. Whether it’s a business coach, executive coach, or peer advisory group, outside perspective helps leaders see blind spots, make better decisions faster, and avoid the isolation that comes with being at the top. If you want your leadership team to grow, coaching isn’t a luxury — it’s infrastructure.

5. Culture: Why It Matters More Than You Think

Culture in a small business isn’t a ping-pong table or a mission statement on the wall. It’s the set of unwritten rules that determine how your team behaves when you’re not in the room. A strong culture attracts better talent, reduces turnover, and makes your business more resilient. Ignoring it doesn’t mean you don’t have one — it just means someone else is defining it for you.

Questions or comments from the broadcast? Reach out to Thomas J. Perrone directly at tperrone@necgginc.com. His book, “Unlocking Your Business’ DNA,” is available on Amazon in paperback and Kindle — with profits going to Veteran Groups.

ken@somershrsolutions.com

(508) 507-1207

Buy and Sell Agreement Tutorial

by YOUR BUSINESS WORTH, posted in Business Growth and Transition, Buy and Sell Agreements, Company Wealth, Estate Planning, evaluations, Funding your Buy and Sell, Income from your business, Key People_Or Group, Passive Ownership, retirement, Selling Your Business, Valuation, Value drivers

By: Thomas J. Perrone, CLU,CIC

and Sell arrangements that have emerged since the Connelly case.

The tutorial delves into the rationale behind the utilization of these arrangements and elucidates their advantages.

Furthermore, a comparative analysis of the funding costs associated with different Buy and Sell Agreement structures is presented.

FREE BOOK “UNLOCKING YOUR BUSINESS DNA” FREE DOWNLOAD

https://www.allclients.com/Form3.aspx?Key=4F3D16E276A4EC0C73BFDC182AA06C23

An Insurance LLC

by YOUR BUSINESS WORTH, posted in Business Growth and Transition, Buy and Sell Agreements, Company Wealth, Estate Planning, evaluations, Executive Benefits, Funding your Buy and Sell, Inside Sale, Passive Ownership, Strategies of growing business, Uncategorized

By Thomas J. Perrone, CLU, CIC

An Insurance LLC is a limited liability company (LLC) created to own and manage one or more life insurance policies to help meet the obligations under a buy-sell agreement. The Insurance LLC is a new business entity formed under local law, separate and apart from the business or businesses that are subject to the primary buy-sell obligations.  Since the Connelly ruling, Advisors are looking for ways to provide a funding arrangement for buy and sell agreements and the Insurance LLC is another way of providing for the buy and sell arrangements.  

GET YOUR FREE eBook, “Unlocking Your Business DNA”. My published book discussing 50+ years of strategies used to Protect, Create Wealth, Grow business, and Transition the business. Great strategies for advisor and business owner- yours free.

https://www.allclients.com/Form3.aspx?Key=4F3D16E276A4EC0C73BFDC182AA06C23

The Process Of Transition In The Mind Of A Business Owner!

by YOUR BUSINESS WORTH, posted in Business Growth and Transition, evaluations, Income from your business, Inside Sale, Key People_Or Group, Passive Ownership

Thomas J. Perrone, CLU, CIC

It’s not easy thinking about the transition of your business! Ask any business owner who has built their business, treated it like a family member, and put all that they had in their “life’s effort”.

It’s a great story with great lessons.

https://podcasts.apple.com/us/podcast/building-and-protecting-your-business-worth/id1539791693?i=1000690360724

Sharpening Your Planning Skills to Get Ready  

by YOUR BUSINESS WORTH, posted in Business Growth and Transition, Buy and Sell Agreements, evaluations, Funding your Buy and Sell, Income from your business, Inside Sale, Passive Ownership, Selling Your Business, Strategies of growing business, Valuation, Value drivers

By Thomas J. Perrone, CLU, CIC

Last month I posted a video on some of the general planning tools you have not used in the past eight years because of the Jobs Act.  That is because of the high limits on the unified estate and gift tax amount.  The high limits sheltered many estate owners and business owners from an estate tax.  With the possible change around the corner it’s time to get ready.   

This month I share how to use some of the tools discussed and why.  Enjoy the video.  

For your free Sunset 2026 Planning Guide, CLICK THIS LINK  

The Guide will automatically download.   

PREPARE FOR 2026 AND GET ENGAGED WITH THE MARKET

Take the Planning Tools Out of the Shed- You’ll Need Them!  

Featured by YOUR BUSINESS WORTH, posted in Business Growth and Transition, Buy and Sell Agreements, Company Wealth, Estate Planning, evaluations, Executive Benefits, Funding your Buy and Sell, Income from your business, Inside Sale, Key People_Or Group, Life Insurance Types, Passive Ownership, retirement, Selling Your Business

Thomas J. Perrone, CLU, CIC

After the 2017 Jobs Act, many of us (estate and business planners), had to shift our planning topics to moderate estate, Medicaid and income tax planning.  

Many of the tools we used prior to the 2017Jobs Act were often used in the planning process, simply because more business owners were affected and exposed to the Federal and State Estate Tax System. Consequently, more sophisticated strategies were needed to shift value, freeze value, or shelter value from the estate.  

Once the Jobs Act came into play, the exemption amounts eliminated many small business owners from the problem of estate taxation.  

However, with part of the Jobs Act heading for Sunset, we may see more businesses becoming exposed to Federal and State estate taxation.  

Time to go to the shed if you want to play in this market.  

This video will help guide you to some of the areas of planning you will have to dust off and rekindle for use.  

Download your Free Business Guide which will help explain many of the topics discussed. Immediate download, CLICK HERE! 

Thomas J. Perrone, CLU, CIC

tperrone@necgginc.com

The Elephant in The Room!  

by YOUR BUSINESS WORTH, posted in Business Growth and Transition, Buy and Sell Agreements, Company Wealth, Estate Planning, evaluations, Executive Benefits, Funding your Buy and Sell, Income from your business, Inside Sale, Passive Ownership

BY: Thomas J. Perrone, CLU,CIC

The elephant in the room is about the four major questions that need to be asked by a business owner and advisors for the business owner to avoid failure of the business. The four major questions are. 

  1. What happens to the business if you die become disabled or want to retire?  
  1. What happens to the business if you lose your key person or key group to competition, or they leave?  
  1. What happens to your business if you have a bad economy and cannot make cash flow to support the business? 
  1.  What happens if you burn out and want to leave the business?  

I cover these four areas in this video.  

The major question:   

How Will the Failure of the Business Affect Your Family!  

Get your Free Business Guide Download. This Free Guide will be invaluable as a quick reference for business planning. Our gift to you. CLICK THIS LINK AND THE REPORT WILL DOWNLOAD IMMEDIATELY!  

https://bit.ly/3hD9U6A

The Right Life Insurance Policy for Your Client? 

Featured by YOUR BUSINESS WORTH, posted in Buy and Sell Agreements, Company Wealth, Estate Planning, Executive Benefits, Funding your Buy and Sell, Income from your business, Inside Sale, Key People_Or Group, Passive Ownership, retirement

By Thomas J. Perrone, CLU, CIC

Before the advisors can give you their opinion, they need to know whether the problem is permanent or temporary.  See, buying term insurance when the problem is permanent is like wetting the bed, eventually you will have to get up and change the sheets.   

Not only does the insurance broker have to ask tough questions about the coverage, but also the other advisors that are part of the team.   

Too often, advisors knee jerk to one type of plan because of the lack of information they have, or their misconceptions of coverage.  In many cases, the knee jerk suggestion is the wrong one.   

This video covers some important points of what is needed to make the right decision about the coverage.   

Questions such as:  

  • How long will the problem exist 
  • Age of the insured 
  • Is the problem permanent like tax liability or does it have a predictable ending date 
  • Actual cost when comparing the value of cask value 
  • Renewal rates in the future 
  • conversions of coverage – is the coverage convertible 
  • cash flow predictable 
  • Is the problem a reoccurring one 

ENJOY your FREE Business And Estate COMPREHENSIVE GUIDE – CLICK TO DOWNLOAD

https://www.allclients.com/Form2.aspx?Key=76EB00B717E35DC55BDE502F30D6ACD6

THREE WAYS TO GROW YOUR BUSINESS WEALTH! 

by YOUR BUSINESS WORTH, posted in Business Growth and Transition, Buy and Sell Agreements, Company Wealth, Estate Planning, evaluations, Executive Benefits, Funding your Buy and Sell, Income from your business, Inside Sale, Key People_Or Group, Passive Ownership, retirement, Selling Your Business, Strategies of growing business, Tax Efficient, Tax Free Income, Uncategorized

Thomas J. Perrone, CLU, CIC – NEW ENGLAND CONSULTING GROUP OF GUILFORD, INC

Growing value in your business can create tremendous wealth, however, only 15-30% of the small businesses will sell, which creates the “if factor”, the unknown.  

The percentage of sales is lower for the smaller owned business, more like 15%.  

Building your business to its highest potential value is possible by having guidelines of what must be done as you grow the business.  

To hedge the “what if’s” of selling it, you can use the cash flow of the business to create other assets such as executive compensation and qualified benefits and plans.   

Many owners neglect to consider these options and end up with too much wealth in their business, causing liquidity and tax problems when they leave, die or become disabled. This presents the problem of “how do you get your wealth out of your business on a tax advantaged method” when you want to leave the business and you need it?  

Building Your Business to Sell in The Future! 

Here is a list of strategies that will help in growing a robust business and greatest potential value.  

  • Develop value drivers  
  • Create a culture- employees come to you because of it 
  • Develop a middle management 
  • Systematize your business 
  • Customer diversification  
  • Avoid being dependent on a few customers for your sales  
  • Marketing plan- and always update it and analyze it 
  • Focus on growth of revenue, lowing of costs 
  • Protect yourself from litig 
  • Make sure you protect yourself such as  
  • Fund your Buy & sell agreements, bank loans, audit your liability insurance, protective documents, etc. 
  • Have a strategy to sell or transition your business, such as growing the middle management, and key people to step in and run the company, or even buy it. This is a long-term process, but you must put things in order and work on strategies to get the greatest potential value from the business.  

When Considering Using Your Business Cash Flow to Develop Executive Compensation and Other Benefits,  

Such as:  

  • Executive Compensation plans, where the company contributes to the plan, and you as owner pay as little as 2% in taxes on the contribution.  
  • Salary Continuation and deferred compensation arrangements for you.  
  • Deposit into your company’s retirement plan (like 401k, profit sharing, 403b, etc.). However, if you are a “high earning business owner”, do not load up on 401k contributions and other contributory plans as the tax consequences are severe.  
  • Make sure your buy and sell agreements are funded and updated. Make sure they cover at least the seven major triggers (death, disability, voluntary and non-voluntary termination, divorce, bankruptcy, retirement).  
  • Have critical illness plans set up such as medical reimbursement plans, disability, and health coverage.  
  • Tie your major Key group to your company as they are the value of the company and contribute to the cash flow of your company, allowing you to implement these strategies.  
  • Create vested benefit schedules to keep them with you  
  • Have a company evaluation /appraisal periodically.  
  • Focus your attention on growing sales, as all things point to sales revenue. 

Executive Compensation Is a Fantastic Way to Extract the Value of Your Company on a Tax-favored Basis, And Not Tie It Up in Your Company, Having It Available to You When Needed. 

There are but a few thoughts concerning building wealth through your business while building your business.  

If you would like to receive my report on the “JFK ERA BENEFITS THAT CREATED SUBSTANTIAL WEALTH FOR BUSINESS OWNER”, CLICK THE link and it will download. This benefit was around in the 50’s, but only for the bigger companies, now it is available to the smallest of businesses, and may be one of the greatest business owner benefits available.  CLICK JFK 

Now It’s Available for You!

Featured by YOUR BUSINESS WORTH, posted in Business Growth and Transition, Company Wealth, Estate Planning, Executive Benefits, Inside Sale, Key People_Or Group, Passive Ownership, Selling Your Business, Strategies of growing business

IN THE “John F. Kennedy Era” 

Business Owners Created Substantial Wealth Using This Benefit!  

Business owners are the most susceptible to it…

Don’t feel bad if this happens to you! 

 WE are susceptible to “not knowing” things WE need to know TO SECURE OUR business growth.

This is why WE need good business advisors.   

However, sometimes by not knowing, you are too late to the party, and opportunities are missed.

THIS IS ONE THING YOU NEED TO KNOW!

It is called “The Corporate Equity Executive Plan”, (OR CEEP.)  It is designed for highly paid business owners and executives.  The plan has been around since the 60’s, and it was used by the “big guns “of the Fortune 500 type companies.  

And You Don’t Want to Be Late TO THIS PARTY!

However, over the years, the plans have been redesigned for the smaller business owner, making it possible for you to take advantage of this substantial benefit plan.  

Because this benefit has been used in large companies such as the S&P 500, many advisors are not aware of this “Hidden Gem of a Benefit.”

Leo had a successful business in wholesale.  He gave his employees great benefits, treated them well, had a 401k, and great health benefits. 

His problem was the 401k limited the amount of contribution he personally could make to the plan because of his high salary.  This was a problem for Leo, because even though he made 401k contributions his percentage of final pay was much lower compared to final earnings. 

Leo didn’t want to depend on selling his business for his retirement, as he had children and grandchildren who wanted to run it and Leo regarded his company as a legacy to his family. 

 Leo wanted his company to support his future security, however, the 401k limited this ability.  

When we projected his retirement benefit percentage compared to his final pay, he was substantially lower than his lower paid employees.   His employee group would retire with social security and their retirement benefit at about 65-80% of their final earnings.   In Leo’s case, his percentage would be about 40% of his final earnings.     

To make up the difference we introduced Leo to the CEEP plan.  The plan allowed him to decide the number of deposits he wanted to make into the plan.  Leo decided to put in $50,000 more a year until his retirement.  This added amount, would increase his final income to around 80-90% of his final pay, adjusted for inflation and salary increases. 

Because the business is funding his retirement plan, he has the benefit of having very efficient tax results.   The plan allowed Leo to use the funds whenever needed, and all withdrawals were tax-free.  Leo was the only participant in the plan, but he plans on adding a few family members to the plan in the future. 

 Considering all the withdrawals would be tax-free, unlike a qualified 401k plan, Leo was able to secure his financial security through the funding by his company! Because very little of the contribution is part of his total compensation, Leo saw a great opportunity for the company to pay for his retirement. They pay for his cars, country club, lunches, some vacations, why not his retirement?

This was a case where the CEEP allowed the highly paid owner to create wealth for themselves, but also on a tax-free basis, allowing more flexibility at retirement for him and his family.  

“Create Your Own “Tax-Free Haven”

By using your company’s cash flow, you can create a tax-free retirement plan. Imagine, no taxes on your income when you retire!

  • Participations: You do not have to include anyone else in the plan. 
  • Contributions: Contribute to the plan as much as you want with flexible contributions, including skipping ability.  
  • Contribution allocation: All the contributions go to your account, and you are not forced to share contributions with anyone.
  • Usage of funds: You can withdraw these funds before 59 1/2 without taxes, penalty, or restriction-why not fund your inventory this way- without a banker! 
  • Funded by your company:   Like a 401k plan, your company contributes to the plan, to your account, since you are the only participant.  
  • Deductible: The company can decide when they wish to take the deduction of the plan.  
  • At Death:  From day one there is a “self-completion clause”, if you die, a tax-free lump sum benefit is paid to your family. In most cases this is the amount of money you would have created in retirement had you lived to retirement. 
  • No force out like RMD: At retirement you are not forced to take withdrawals from your plan, like the required minimum distribution rules under 401k’s and IRA’S.  
  • No Tax on Inheritance:  All benefits are tax-free to your family at your death.
  • more….

Do you remember When?  

When you were a kid, did you ever lay down in freshly mowed green grass and stare up at the blue sky and watch the clouds move?  You smelled the sweetness of the cut grass and just felt so relaxed?  In the background, you hear a twin-engine airplane flying above.  This is the moment in time when there were no issues in life, things were great and easy, and you were so relaxed…

Imagine that feeling, but now it’s at a time in life where you are ready to enjoy more time to “lay in the grass” again and feel that same feeling.  Only now, you are retired, and because you made the right planning decisions, there are no issues.  Financially, you are enjoying a wonderful retirement lifestyle.  The reason: you eliminated income taxes!   You are living the tax-free lifestyle which the CEEP plan offers.   

That is what the CEEP can create for you, and I want to give you more information about it because it is

one of the best benefits ever for business owners.

This is one of those moments you don’t want to show up late for the party!  If you haven’t been exposed to this type of executive benefit, do yourself a favor and download this Free White Paper that explains it all.

I encourage you to take a new path that will give you the opportunity to create greater financial wealth for your future.  A path that will educate you on the great usage of business cash flow to create more financial security.  The path you want to take is to request this free report, download it and spend some time learning about this fabulous benefit used by many high earning business owners and executives since the “John Fitzgerald Kennedy Era”. 

To receive your FREE WHITE PAPER, SCAN THE QR CODE.   COMPLETE the short form and your FREE WHITE PAPER WILL DOWNLOAD IMMEDIATELY…

Or CLICK OR TYPE IN

P.S. SPECIAL OFFER: The first 15 requests will receive a free copy of my book, “Unlocking Your Business DNA”.  A BOOK filled with business strategies that will allow you to grow your business and create an ungodly amount of leisure time to enjoy what you are building. 

https://bit.ly/3WjP0yw