Bosses are missing out on their hard earned rewards by investing their wealth back into their business, chartered accountants Haines Watts has found. They are also jeopardising the security of their firms by becoming too “over-reliant” on themselves.
Essentially, more than two fifths of those surveyed believe their firm could not survive more than a week without them, while more than one in ten believe it could only manage for up to three days. And they are taking risks by putting their “financial future faith” on a stock exchange.
“Company owners are gambling their wealth on their business, leaving their financial security hanging in the balance,” said Darren Holdway, managing partner at Haines Watts. This is surprising given how hard they work to generate that wealth in the first place and the obvious risks involved.
As a busy business owner, it’s easy to believe that your company is a safe investment. But if I held up a mirror, I don’t think many owners whatever their age or stage in their life would be comfortable with what they saw. They would wish they had a contingency plan in place and spent more time considering their options.
UK bosses had what the company deemed ?blind faith,” suggesting employers were putting all of their eggs into one basket. Half of respondents claimed to have one supplier they couldn?t be successful without, with 43 per cent saying there was a specific customer that contributed 30 per cent of their revenue. Some 50 per cent also admitted to having one key member of staff.
“The basket being used by business owners is also riddled with holes,” Holdway said. There’s an alarming degree of risk of downtime in the event of an accident or disruption. As we have witnessed with the UK’s recent Brexit vote, the potential for significant market disruption is never far away and any company could fall to its knees if it doesn’t have the right contingency plans in place to deal with such an event.
?Wealth is about more than just the here and now; it’s about protecting your financial future, your family and your staff. As a business leader, it’s careless to cross your fingers and hope for the best; company owners need to realise how much is at stake, address their biggest areas of vulnerability and regain control of their future.
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