Wise words for business owners

Shannon CareyFeature, Fountain City

Financial advisor Jeffrey Jeter was talking to a tough crowd at the Fountain City Business and Professional Association meeting Aug. 8. But they weren’t tough in the way you might think. Instead of having a group of small business owners to whom he could extol the virtues of wise financial planning, he was talking to a group of bankers, insurance agents and legal professionals.

You could say he was preaching to the choir.

Jeter’s presentation was all about business owners leaning too heavily on their businesses as retirement income and inheritance for their heirs. The takeaway was simple: your business is worth what someone will pay for it. And there are plenty of pitfalls along the way.

“We can’t build a plan on anything but money in the bank,” he said. “Whatever it is that you think is worth $1 million, it’s only worth $1 million to the owner.”

Jeffrey Jeter shows off his much-debated purple shoes.

He used the example of his purple, imported leather shoes, asking folks what they would pay for them. He paid $34.95, a big discount, but someone in the audience said $0. That person was Commercial Bank vice president John Fugate, who had some wise words to add.

Back in the 1970s, Fugate bought a business, put $200,000 of his own money into it, then had to sell during a time when interest rates were 21 percent.

“I couldn’t give it away,” Fugate said. “When they’re doing good, all they can see is expanding. They can’t see putting some of that money back. It’s like the hog sitting under the acorn tree. He never looks up to see where the acorns come from, and sooner or later they run out.”

Penny Kleinschmidt of State Farm added her own experiences to the issue.

“We’re all guaranteed to die sometime,” she said. “I have never delivered a life insurance check where someone told me it was too much money.”

Jeter said he’s a retirement income specialist with “a soft spot for business owners,” plus people who work on commission, are service providers or are special needs families. Info: jsjeter@onesouthfg.com

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