There are several roles small business owners undertake by themselves out of necessity, but financial planning shouldn’t be one of them.
A financial planner or advisor can provide strategies to maximize the value of the small business in simple, yet effective ways, and can be a useful resource because it helps to have the best advice available when making decisions about your business’ future.
While it costs money to hire a financial advisor, the return on that investment can increase a business’ financial health, create a viable plan for retirement for both the business owner and employees, and protect against unexpected events.
Some of the simple ways that a financial planner or advisor can help are:
Business owners are experts at their core business but may not be as knowledgeable about financial education. Getting guidance at the right time can help business owners avoid potential pitfalls later.
One area of financial education that is often overlooked is offering financial education to a business’ employees. This can help serve both the employer and the employees if done correctly. Employees who are better educated about financial affairs are more likely to make sound personal financial decisions, which can benefit more than their personal bottom line. It can also help them be more motivated and productive workers, which can benefit your business’ bottom line, too.
It can be difficult to envision retirement when you are in the midst of running your small business. However, time catches up to us all, so having a proper retirement plan in place can help you spend your golden years in the manner you wish to do so.
Devising and implementing the proper retirement plan can help in the present as well as the future. When a well thought out retirement plan is in place, it has the potential to proactively and positively affect the business owner’s business and personal taxes. Often times, it takes the surprises out of an otherwise stressful time of year.
Additionally, a business that offers a well thought out retirement plan for its employees can be effective in attracting and retaining key, quality talent.
Often, small business owners’ greatest asset is their business, yet they do poorly in protecting that asset. That can begin with not having a proper succession plan in place for the owner, or not having a plan in place to protect against the loss of a key employee or employees. Business owners can be vulnerable to losing a significant portion of the business’ value should something happen to them, or when a key employee leaves, becomes disabled and cannot work, or even dies. Having a well thought out succession plan can add multiples to the true value of a business.
While every business can be a little bit different in both needs and scope, the main takeaway here is that a financial planner or advisor can add value to your business. Compass Wealth Management can help create an individualized plan for your business. Let’s talk (724) 719-3288.