Disability insurance should also be considered. Many insurance companies do not offer this type of coverage to business owners who work out of their own home, but check with your insurance agent to see what he or she can find. If you have a partner, you might also consider some type of buy sell coverage so that if one of you dies or becomes severely disabled, the healthy owner can buy the interest in the business back from the one affected. Both life and disability insurance is available to fund this need. Finally, you should also keep an eye towards the day when you will retire from work ing.
Business owners are able to put money into various pension type vehicles on a tax favorable basis.
For many business owners, this amount is insufficient, thus other vehicles where larger amounts can be put away for retirement are more attractive. Sole pro prietors usually select this type of plan. These retirement vehicles should be discussed with your accountant for advice on the best avenue to pursue. Not only do these programs serve as a source for retirement funds, they also assist the business owner with reducing current tax liability. All business owners should review their options carefully.