Ask an owner-manager what their retirement plan is and the answer is frequently some version of: the business.
It is not an unreasonable answer. It is usually the largest asset they have, and building it has taken decades. But as a retirement plan specifically, it has three properties that are worth naming.
It is concentrated
Everything depends on one asset, in one sector, in one geography, frequently with one or two dominant customers.
If you held a portfolio with that composition you would consider it reckless. It becomes acceptable when it is a business only because the exposure arrived gradually and feels like control rather than risk.
It is illiquid
You cannot sell a portion of it in the month you need money. A sale process for an SME in India commonly takes nine to eighteen months, and that is when it completes.
Retirement, meanwhile, arrives on a schedule.
Its value depends on things you do not control
A buyer existing. At a price. At a time that suits you. In a market that is receptive.
And critically: a business that depends on you is worth less than one that does not. The very quality that made it successful — the founder holding the key relationships, the technical knowledge, the pricing judgement — is the quality that reduces what an acquirer will pay, because they are buying something that leaves with you.
Stress-testing it
Three questions, answered honestly.
What would it realistically fetch? Not what you would like. What a buyer, looking at your actual books and customer concentration, would pay. If the books are not clean, the answer is materially less, and that discount is avoidable.
How long would a sale take, and what if it does not happen on schedule? What funds the intervening period?
What is it worth without you in it? If the answer is “considerably less”, that gap is a project — documented processes, a second person in key relationships, management depth — and it takes years, which is why it belongs on the agenda now rather than at sixty.
What to build alongside
Not instead of. Alongside.
Something liquid, diversified, and entirely independent of the business’s fortunes. It does not need to fund the whole retirement — it needs to be enough that the timing of a sale becomes a choice rather than a necessity.
That distinction is the entire point. An owner who can afford to wait for the right buyer gets a materially better price than one who cannot.
Run the number
Work out the target in inflation-adjusted terms, then check honestly whether current saving reaches it. That single calculation changes most people’s plans.
Do it excluding the business. What you learn from that version is usually the useful part.
