National Clothesline
National Clothesline
Basketball coaching legend John Wooden said, “Failing to plan is planning to fail.”
An email I received made the following inquiry, “I am 63 years old and have been in business
for over 20 years. I would like to start planning my retirement. Do you have any suggestions?”
Retirement presents an entirely
new lifestyle, especially if you have
not prepared for that phase of your
life. Because I was faced with
retirement issues a few years ago, I
will try to fill you in on what I have
If you do not have a hobby, I
suggest you think about doing some
things that might keep you busy.
I am fortunate that the state of
California provides a free education program for those over 55 years of age at a junior college
level. While attending classes I have focused on photography, which has forced me to upgrade
my computer skills by learning new software.
The first thing to consider regarding retirement is your health. You must exercise your mind
and your body. I go to a gym three days per week. I go to school two days per week. With all of
that going on, in addition to participation in a local photography club, a community computer
club, and the homeowner’s association board of directors, I manage to keep busy.
Do not become a couch potato. The aging process accelerates rapidly when you are not
exercising the mind and body. Another hobby of mine is taking care of our back yard. It gets me
out of the house and when I am finished, I can look at the yard with a great sense of
The education I have received over the last five years has provided me with the opportunity
to post photography slideshows on YouTube. Over 50,000 people, from all over the world, have
viewed those shows.
The next important thing, now that you have taken care of your mind and body, is your
money. I did not put money first because your physical and mental health are far more
important than any other aspects of your life.
Are you investing in the stock market? Have you bought income producing real estate? Do
insurance annuities appeal to you? How about investing with a company that buys life insurance
policies from people who average over 80 years of age?
You will be amazed at the variety of investments that are available. I read an ad today in the
Orange County Register selling investments in First Trust Deeds that will provide a 10 percent
return on your money. In this low bank interest environment, anything goes.
My suggestion is you consider real estate or find a certified financial planner and start a
program that will provide income. Income producing real estate is good if you do not mind
maintaining it, and dealing with tenants. The problem with stockbrokers is they have their own
best interest at heart, not your best interest.
Not having that weekly or bi-weekly check deposited into your bank account is a large
adjustment. Consider purchasing Quicken to track your current income and expenses. Learn
where you and your wife are spending money.
Creating a financial plan for you and your spouse is as important as creating a business plan.
Part of your plan should include health care. You will have Medicare Part A and Part B coverage,
but that is never enough. You must select a Medicare Supplement.
Fortunately for Barbara and I, an uncle in the insurance industry suggested we purchase the
best supplement available, which at that time was a J plan. The J plan is no longer being sold,
but we are grandfathered in. Find the best plan you can afford, and be thankful you have it.
Your medications can be covered with what is known as a Part D supplement. Because of
rising drug costs, I shop for our Part D supplements every year. The drug companies know that
most people will not take the time to do that, so the premiums continue to rise.
The Medicare website is one of the best things our government has done. You can shop for
Medicare supplement plans on line and find one that fits your needs. Go to Medicare.gov to get
the information.
Finally, go to an attorney, and set up a revocable family trust. Put your assets into the trust.
That includes your home and any bank accounts along with whatever assets the attorney and
CPA recommend.
Now that you have your personal life in order, let us look at the business, and determine how
to prepare for the sale. Here is where you have a decision-making process to go through. This is
the key question.
Do you want to lend the buyer money to purchase your company? If you want to be the
lending agency, I suggest you use the personal assets of the buyer to guarantee the loan. Do
not use the business as security. I know of a company that was sold and the seller carried the
loan. The buyer, after a few years of killing the sales, removed all the equipment and vanished.
Maximize the value of your business by increasing your bottom line. You can cut costs. You
can report all your income. These are not easy things to do, but if you want the highest sales
price, they are necessary.
Talk to your property owner, if you do not own the location, and get a new lease, lease option
and/or lease extensions. Any buyer who has a brain will want at least a five-year lease with
another five-year option. Better yet would be two five-year options.
You must talk to your accountant and learn how to handle your tax situation when you sell.
You can run into very expensive issues when the state and Uncle Sam takes as much as 33
percent of the selling price.
Even if you are not retiring, much of this advice should be considered for you and your family.
Remember what coach Wooden said about planning. His statement is as valid for your life as it
was for his coaching.
In the event you need a question or questions answered, do not hesitate to send me by email
or phone. As you have read, I will respond to most questions, no matter the subject matter.

Making plans for retirement?
Harvey Gershenson
operates Sterling
Drycleaning Consulting
and is a former owner of
Sterling Dry Cleaners. A
drycleaner, he has been
in the industry since he
was in high school. He
has served as president
of the Cleaners and Dyers
Guild of Los Angeles and
has served on the boards
of directors of the
Drycleaning and Laundry
Institute and the
California Cleaners
Association. He is also a
guest lecturer for the
California Department of
Corrections. He can be
reached by e-mail at
consultme@msn.com or
phone at (310) 261-
2623. His web site is