the wealth gap

Closing the Wealth Gap: A Business Owner’s Path to Financial Freedom

For most business owners, 80% of their net worth is tied to their business. But is your business prepared to bridge the gap between where you are and where you need to be to achieve your financial goals? Let’s explore how identifying and addressing your wealth gap can transform your financial future.

As a business owner, your focus is often on driving growth, meeting customer needs, and leading your team. But when it comes to planning for your financial future, have you considered what happens when it’s time to transition out of your business? For many entrepreneurs, having the majority of their net worth tied to their business highlights the importance of a carefully crafted exit strategy.

At Truly Aligned: A Wealth Management Firm, we understand that achieving financial freedom begins with identifying and addressing your wealth gap. As wealth managers, we work with clients like you to turn uncertainty into a strategic plan, aligning your wealth with your goals and values.

What Is the Wealth Gap?

The wealth gap is the difference between the wealth you currently have and the wealth you need to achieve your financial goals or sustain your desired lifestyle after exiting your business.

Let’s break it down:

  • Current Wealth: The value of your assets today, including your business, retirement accounts, real estate, and investments.
  • Required Wealth: The amount you need to fund your future, including retirement and family goals like education, travel, or philanthropy.

The gap between these two numbers represents the financial shortfall that must be addressed to confidently plan your future.

Why the Wealth Gap Matters

For business owners, the wealth gap isn’t just about numbers—it’s about transforming your business into the bridge to the life you’ve envisioned. Here’s why identifying and closing the wealth gap is crucial:

  1. Your Business is Likely Your Biggest Asset: With most of your net worth tied to your business, its valuation and salability are directly connected to your ability to meet your financial goals. Knowing the price your business needs to sell for to close your wealth gap is the foundation of a successful exit strategy.
  2. It Aligns Financial Decisions With Your Goals: Addressing the wealth gap brings clarity. It helps you define the resources required to live the life you want, from sustaining your lifestyle to leaving a legacy for your family.
  3. It Paves the Way for Freedom: Closing your wealth gap gives you the freedom to focus on what matters most—whether that’s family, personal passions, or community impact.

The Steps to Closing Your Wealth Gap

  1. Understand Your Wealth Gap
    The first step is assessing your current position. We determine the value of your business and other assets, then work together to define your financial goals and calculate the required wealth to achieve them.
  2. Improving Your Business Valuation: 
  • Increasing your business’s value by enhancing the four intangible capitals: Human Capital, Structural/System Capital, Customer/Client Capital, and Social/Cultural Capital.
  • Improving profitability to enhance market value.
  • Preparing for a sale or transition by identifying the ideal timing and terms to meet your goals.
  1. Define Your Exit Strategy
    With the wealth gap in mind, we align your business strategy with your financial goals. This includes:
  1. Optimize Your Investments
    As wealth advisors, we also help you diversify beyond your business. This includes building a well-rounded investment portfolio and setting up retirement accounts through your business or personal accounts, reducing reliance on your business’s sale.1
  2. Address Tax Strategies
    Taxes significantly impact the wealth you retain. Our wealth management approach includes strategies to minimize tax liabilities, such as:
  • Selling your business as Qualified Small Business Stock (QSBS), if eligible.
  • Exploring Charitable Remainder Unitrusts for tax-efficient giving.
  1. Reassess and Adjust
    Life and markets evolve, so ongoing adjustments are essential. We provide continuous wealth management to keep your strategy aligned with your goals.

The Benefits of Closing Your Wealth Gap

Working with a wealth management firm like Truly Aligned means more than creating a financial plan—it’s about using your wealth as a tool to build a meaningful future. Here’s how closing your wealth gap benefits you:

  • Achieve Financial Independence: Know when you can step away from your business without compromising your lifestyle.
  • Fund Your Legacy: From supporting your children’s education to giving back to causes you care about, your wealth becomes a resource for impact.
  • Enjoy Your Success: With a clear plan in place, you can focus on what fulfills you, confident in your financial future.

Why Work With Truly Aligned

At Truly Aligned: A Wealth Management Firm, we specialize in helping business owners turn their most valuable asset into a bridge to the future they’ve worked hard to create. As wealth managers, we align your financial strategy with your personal values, ensuring every decision moves you closer to the life you want.

We understand that every business owner’s journey is unique. That’s why we provide customized wealth management solutions to address your wealth gap, support your goals, and help you build a legacy that lasts.

The Bottom Line

For business owners, the wealth gap is more than a number—it’s the path to achieving your vision of financial independence, family security, and meaningful impact. Addressing this gap starts with understanding your goals and creating a strategy to close the space between where you are and where you want to be.

At Truly Aligned, we’re here to guide you every step of the way. Let us help you turn your business into a lasting legacy and your wealth into a tool for creating the life you’ve always envisioned.

Sources:

  1. Exit Planning Institute – Intangible Capitals
  2. Exit Planning Institute – Businesses That Fail to Sell

1There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.

Discover Your Wealth Archetype

Did you know there are 8 Wealth Archetypes. Which one are you?

Your path to Financial Alignment begins with knowing your Wealth Archetype.

Take our 5-minute quiz to unlock your Wealth Archetype and start your journey to Financial Alignment!

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