Case Study
Michael & Sarah: Exited Business Owners
Case studies are hypothetical in nature and do not represent scenarios or results experienced by actual clients.
Post Business Exit Transition
Michael and Sarah found themselves in an unfamiliar position after successfully selling their manufacturing business for $16 million. No longer business builders, they struggled with their new identity as “wealth stewards” and grappled with questions about how to manage their newfound liquidity. They felt both excitement and unease as they faced the daunting task of turning their hard-earned financial success into a fulfilling and purposeful next chapter.
Profile
- Michael and Sarah, both 58, married 32 years with three adult children
- Recently sold their manufacturing business for $16 million (approximately $11 million after taxes and selling fees).
- Current asset portfolio includes $2.8 million in retirement accounts, $1.2 million in non-retirement accounts, $1.5 million primary residence (paid off), and proceeds from business sale.
- Both experiencing significant life transitions, with stepping away from daily business operations and adapting to a new dynamic where their time, priorities, and relationship are no longer centered around the business.
Primary Goals
After spending three decades building their business, Michael and Sarah found themselves grappling with a new reality. While financially secure, they struggled with the emotional aspects of wealth. Their primary focus shifted from wealth creation to preservation, but they needed help defining what “living well” meant in this new chapter. They expressed interest in travel and philanthropy but felt almost guilty about enjoying their wealth.
Challenges
“How do we manage all of this liquid wealth?”
Having most of their net worth previously tied up in their business, they felt overwhelmed by the responsibility of managing significant liquid assets.
“What’s our purpose now?”
Michael and Sarah struggled with their post-business identity, as their identity had been partially defined by building a successful business.
“Are we really free to spend?”
Despite their significant wealth, they remained hesitant about major expenditures and needed clarity on sustainable spending levels.
“How do we create a meaningful legacy?”
They wanted to impact their children’s lives positively without creating dependency and support causes they cared about.
“CAn we really relax and enjoy this?”
They found it difficult to shift from a wealth accumulation mindset to one of thoughtful wealth enjoyment.
Discovery
We took Michael and Sarah through our proprietary Empowering Conversations process which revealed key priorities:
- Maintaining financial security while learning to enjoy their wealth
- Creating meaningful family experiences and traditions
- Developing a structured philanthropic strategy
- Finding new purposes and passions, including focusing on health and wellness
- Education funding for five grandchildren
We conducted a comprehensive financial analysis outlining what they could sustainably spend while preserving their wealth for future generations.
Exploring “What-If” Scenarios
We explored various scenarios, including:
- Different spending levels and their long-term impact
- Purchase of a vacation home for family gatherings
- Creation of a family foundation
- Education funding strategies
- Travel budgets and bucket list experiences
The Freedom Roadmap
1. Wealth Management Strategy
Developed an investment approach focusing on wealth preservation while generating reliable income in a tax efficient manner.
2. Lifestyle Planning
Created a structured spending plan that allowed them to enjoy their wealth without guilt, including a travel budget and family experiences fund.
3. Insurance & Estate Planning
Restructured insurance coverages to reflect their post-sale needs and helped implement a comprehensive estate plan including updated wills, trusts, and advanced directives. This included analyzing life insurance needs for estate liquidity.
4. Legacy Development
Established a family foundation and education trust for grandchildren, providing purpose and structure to their giving.
5. Identity Transition
Connected them with other successful business owners who had navigated similar transitions, providing community and perspective.
Conclusion
Through comprehensive planning and ongoing guidance, Michael and Sarah successfully transitioned from business owners to confident wealth stewards. They’ve found new purpose through philanthropy, deeper family connections, and personal growth opportunities. Their careful planning ensures both lifetime enjoyment of their wealth and a meaningful legacy for future generations.
One year into implementation, Michael and Sarah have hosted their first family retreat at their new vacation home, established a foundation supporting local education initiatives, and embarked on their dream trip to New Zealand. Most importantly, they’ve found peace with their new identity and purpose beyond the business.
