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We recently embarked on some role play. You may recall you had decided that your business was your pension in my blog entitled ‘Our Business is our Pension’. Today you are running your growing business.

You have been running your business for a number of years, initially it was just you. Over a period of time, as you have been successful, you have taken on an apprentice, he served his time, the business prospered, another time served tradesman was taken on, then another, then you took on a young school leaver to help with accounts and all was well with the world; life is rosy.

Then the problem. The total absolute nightmare.

The second staff member you took on, let’s call him Tom, had been out on a job on the Tuesday. You had expected Tom back at the works by early afternoon, but he didn’t show up. You ring his mobile and leave a message to politely enquire where he is. By the time you lock up at 5:45pm Tom was still not back, you leave another slightly less polite message on his mobile, making a mental note to ‘have a word’ in the morning and you head home. Later that night, you hear that Tom had been in an accident and had died as a result of his injuries.

There is a feeling of gloom in the business over the next few days. You are busying yourself on the Friday; rearranging jobs and talking to the insurance company about the claim for the written off van, when your accounts lady asks. ‘I am doing the wages, errm, where do I pay Tom to?’

You suddenly realise you have a big decision to make, till lunchtime on the Tuesday? Till the end of the day on the Tuesday? Till the end of the week? Eventually you decide on the end of the week. So off you go to see Tom’s widow with his one week’s pay packet held firmly in your hand. I suspect this maybe the hardest thing you have ever done in business, perhaps you feel embarrassed, the fact that Tom’s wife genuinely seems grateful, doesn’t really help.

So, was there an alternative?

If you had spoken to a Financial Planner, he would have discussed your remuneration package, and how you can add real value rather than just salary, he would have recommended a Death in Service scheme for three times the Employees annual salary, payable whilst in employment up to retirement, whether death occurs ‘at work or play’.

If the prospect of making the ‘where do I pay him up to?’ decision concerns you, speak to us!

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