From managing daily operations to growing the business, running a small company is no mean feat. That’s why any good businessperson knows it’s important to have a solid financial foundation to ensure success.
However, dealing with financial planning alone can be cumbersome and take up your valuable time as a business owner. Outsourcing your financial planning may be the best option if you find yourself weighed down with the financials.
Here’s our guide to the benefits of a professional financial planner and what they can do for you.
Let’s dive in.
Benefits of a financial planner
The right financial planner can play a vital role in helping small business owners reach their financial goals and grow the company. Here are some of the benefits business owners notice when they first hire a financial planner.
A financial planner is a subject matter expert in corporate finance. If you’re starting a business for the first time and aren’t trained in financial planning, the acronyms and jargon can quickly become a headache.
Financial planners have the training and experience to provide tailored advice and recommendations based on a small business’s specific financial goals and circumstances. This way, you can avoid falling foul of any rules and regulations.
A financial planner has a bird’s eye view of the business that involves planning, cash flow management, retirement planning and tax, to name a few.
This makes your life easier as a financial planner’s comprehensive analysis of all of the financials of the business will make sure everything is working well together. A financial planner can also guide you on how to allocate your resources, manage risk, and reach your financial goals.
There’s no denying that filling out tax forms and looking at spreadsheets to try and make big financial decisions can waste your time. This is the time which could otherwise be spent growing the business and making strategic decisions. You may also not be playing to your strengths and spending too long on the business financials.
This is where hiring a financial planner can make a big difference. By outsourcing your financial planning to a professional, you can free up time to focus on other aspects of your business.
Improved financial decision making
With their expert knowledge and guidance, a financial planner can often be a great help in making key strategic decisions based on your financial position. They can look for areas to improve cash flow, where the budget can be trimmed and a plan to move towards those goals.
A good financial planner can also advise you on how best to take advantage of tax deductions to reduce your liability and identify any risks to the business earlier than you might spot them. All of this, in turn, helps you to make smarter business decisions.
What can a financial planner help with?
Now you’re familiar with why a financial planner could be beneficial to you and your company, let’s look at some of the different areas they can help you save time and money.
Budgeting and cash flow management
A financial planner can develop a budget for you and manage your cash flow to keep the business out of financial difficulties, spot any issues early on and grow the company.
When it comes to budgeting, a financial planner can help you create a comprehensive budget that considers your business’s expenses and revenues. Operations, marketing, salaries – a financial planner would have it covered.
As for cash flow management, the financial planner could sort out all things to do with your balance sheet by tracking cash flow, managing accounts receivable and accounts payable, and ensuring you have enough cash in the bank for unexpected costs.
Any business needs to keep track of things for tax season and when auditors come knocking. A financial planner can help ensure the records are valid, up to date and in line with any regulation changes.
A financial planner can also look over historical records to notice any patterns in the data which could be useful for predicting future finances. This can then help you make better, more informed business decisions you may not have noticed before.
Feeling overwhelmed with understanding tricky tax laws? A financial planner can help you understand the tax laws and regulations that apply to your business and develop strategies to minimize your tax liability.
Choosing the right business structure, taking advantage of tax deductions and reducing your liability in line with other financial areas of your business are all things a financial planner can help with.
When it comes to retirement funds, this can be a real headache to understand as a small business – especially if you’re taking on employees.
A financial planner can help you understand the different retirement plans available to small business owners, such as a Simplified Employee Pension (SEP), a Simple IRA, and a 401(k). They may also be able to advise on where’s best to invest the retirement fund according to your financial goals.
Unfortunately, unexpected losses and events can pop up at any time. A financial planner helps you to future-proof your business by warding off any incoming storms and putting aside enough money in the business to cover those unplanned expenses.
A financial planner can also help put together risk management plans such as contingencies and thinking ahead for economic downturns. They may also be able to help you with recommending insurance options if you have property or need liability insurance.
By working with a financial planner, you can develop a comprehensive financial plan tailored to your specific needs and financial goals. Remember: a financial planner is your partner in making the business a success, and a good one is worth their weight in gold.
If you’re looking for a specialist team that can be your partner in helping your business’ financials, look no further. Our experts are well-equipped to advise you on any financial planning challenges you might be facing. Click here to learn more.