Have a business you intend on selling? Do you have a Buy Sell Agreement in place?

Are you looking to diversify your investment portfolio and explore different strategies to enhance your financial growth? Look no further than the BlackFin Wealth Group. With a strong background in business consulting, BlackFin Wealth Group has transitioned its focus to provide top-notch financial planning and tax strategies to a wide range of clients.

Let’s say:

• Jane owns 100% of a successful design agency.

• Tom wants to buy her business for $1 million, paid over 10 years.

• They agree Tom will pay $100,000 per year.

• To protect Jane in case Tom dies before finishing payments, they use a whole life insurance policy.

🧾 How It’s Set Up:

1. Agreement Terms:

   • Jane and Tom sign a buy-sell agreement: Tom buys the company for $1M in 10 annual payments.

   • If Tom dies before finishing payments, the unpaid balance becomes due immediately.

2. Life Insurance Policy:

   • Tom takes out a whole life insurance policy on himself, with a death benefit of at least the remaining balance (say $700,000 after three years of payments).

   • Jane is named the beneficiary.

3. If Tom Dies in Year 4:

   • He’s paid $300,000 so far, leaving $700,000.

   • Jane receives a $700,000 tax-free death benefit from the policy.

   • The policy funds cover the remaining amount Tom owed.

   • Ownership stays with Tom’s estate (if they had a clause), or fully transfers to Jane (depending on the structure), but either way—Jane is paid in full.

✅ Benefits:

• Jane is protected—she doesn’t lose money if Tom dies.

• Tom’s estate isn’t burdened with the debt.

• The whole life policy will accumulate cash value if designed by an associate at BlackFin Wealth, which Tom could borrow from if needed while growing the business.

• Having a whole life policy designed for high early cash allows Tom to borrow at low simple interest from his policy.

• These loans with proper documentation and tax planning will lower Tom's personal and business taxes, while growing and expand his newly purchased business.

• The existing cash inside the policy continues to grow and compound uninterrupted for a lifetime tax free.

• After Tom has completed his 10 years of $100k payments for $1 million to Jane, the whole life policy can now be used for tax free retirement income and at the same time will be used to protect Tom's current estate.

• Upon Tom's passing away, any estate taxes Tom might owe due to the growth of his business has death benefits of the policy that is several times multiple of the cash inside available to his family to pay these taxes.

If you are interested in learning how this can be designed for you or your business selling or buying, please contact us at BlackFin Wealth Group.