Business owners today spend more time working in their businesses than on their businesses and many lack confidence in planning for the long term, according to a recent study out of MassMutual Financial Group.
The 2015 MassMutual Business Owner Perspectives Study, conducted by Hawk Partners for MassMutual, took stock of business owners’ underlying values and attitudes toward long-term business planning, as well as their obstacles to long-term business planning.
“We found that business owners are spending the majority of their time working in their businesses instead of on their businesses,” Tara Reynolds, MassMutual’s corporate vice president of life company marketing, said in a statement. “It’s never easy to think about death or disability, but in order to raise awareness about these longer-term issues, business owners need to be confronted directly with the potential risk and damage of unexpected events.”
Survey respondents said their most important business planning pillars were keeping key employees loyal to the company and how the business would be affected by the death or disability of an owner or key employee.
Eighty-one percent of respondents said that keeping key employees loyal to the business was top of mind, and 90 percent reported that they offer some type of benefits to their employees, with the most common cited as health care (60 percent), generous salaries (55 percent) and flexible work benefits (51 percent).
However, 55 percent and 59 percent, respectively, also replied that they rarely or never think about the effect of disability or death.
Furthermore, almost 40 percent said they don’t have a retirement strategy outside of income from their business and while most surveyed said they had chosen a successor (frequently a family member), one in four did not know they’d been chosen as a successor.
When polled as to their reasons for not having long-term plans or agreements in place, business owners replied said they don’t feel like they need to think about those issues yet, they are too busy with day-to-day management and don’t have the time, they don’t have the money to put toward addressing those issues, they would not know where to go for help, and finally, it would make for an uncomfortable conversation with their family or business partner.
