Photo of Eric R. Ebbert, CFP®, MBA, CEO Eric R. Ebbert, CFP®, MBA, CEO Jul 01, 2022

Financial planning is a process usually conducted by a financial advisor. An advisor examines the current state of your finances and seeks not only to protect them but also help you reach your long-term financial goals. The job of a financial planner is to help you manage your money in a smart and objective manner while keeping your goals in mind

There are three initial steps that an advisor will typically take during the planning process. The first is to create detailed goals that you hope to achieve within the next several years, or far into the future. This stage is for you to tell your advisor more about yourself and your personal aspirations. The advisor will determine how your money ties into these aspirations. The second step is to take stock of your financial situation. Your advisor will take a look at your history and compile data to analyze strengths and weaknesses that may exist within your current state. Only then can they help you identify the third and additional steps that you need to take to preserve the wealth you have accumulated and get you closer to achieving your goals. Your advisor will create a personalized plan so that you can make informed financial decisions.

Financial planning is not a short-term solution. It requires regular attention and must often be brought up to date regularly. Your advisor will take into account any factors that could affect your finances. This might include inflation, economic instability, booms in the market and more. Their job is to protect your investments as much as possible from external influences such as selling at a bad time, while helping you plan to grow your fortune. Most people develop close relationships with the people they hire to carry out financial planning. This is because an advisor must get to know the quirks, goals and spending habits of each of their clients to better help them. The result of long-term financial planning can be extremely beneficial for someone who seeks out and complies with financial counsel from a professional advisor.

For an individual who is seeking financial planning services for themselves and their families, planning might encircle personal finances, investments, taxes, estates and any personal goals a client may have. However, planning as a small-business owner can look slightly different. If you’re a small-business owner, keep reading to find out exactly what it entails.

What does financial planning look like for a small-business owner?

If you’re a small-business owner seeking financial planning help, here are a few different planning topics that your advisor may review with you.

  • Investment — Investment planning for a small business includes choosing diversified areas to invest in, analyzing risk and seeking potential sponsors who choose to invest in your business. Investment planning also includes investing in your employees. You may want to consider giving your employees access to health benefits and retirement benefits.
  • Cash flow — Cash flow planning will most likely incorporate strategies for boosting your business’s income. It can also include preventing significant losses in income and minimizing debt or managing debt payments.
  • Tax planning — Tax planning involves making sure that your business’s taxes are current and up to date. It may also include how you can reduce the amount of taxes your business will be responsible for paying.
  • Insurance — This sector of planning may include whether you should get health insurance, disability or critical illness insurance, life insurance, and especially pertinent to a business — liability insurance.
  • Succession — This includes brainstorming and planning numerous exit strategies for different financial situations you and your business may go through, such as selling, divorce, death and estate planning.

Why would a small-business owner need a financial planner?

Just like you might hire a marketing expert to efficiently market your products or services, you may benefit from hiring a financial planner to handle the future of your small-business’s fiscal aspects. Some small-business owners choose to manage their finances on their own, which might work for some people. However, the best way to ensure your investment in your business will pay off is to regularly consult with a certified and experienced financial planning professional.

Relying on a financial planner, if you’re a small-business owner, is also likely to ensure peace of mind. According to a Charles Schwab survey, about 65% of participants reported feeling more stable financially after hiring a professional planner. On the contrasting side, those without professional help and who felt comfortable without counsel came in at 40%. Over half of those surveyed said they felt confident that they would reach their financial goals with the assistance of a financial planner. Consulting with a specialist can help small-business owners sleep better knowing that their money is protected and will likely grow.

What kinds of small businesses should look to hire a financial planner? 

Just about every kind of small business can benefit from hiring a planner. A common misconception is that financial planners are only for those with wealth. However, receiving the right planning during the early stages of your business can seriously affect the outcome of your work. If you’re the owner of a small business, you likely juggle a lot all at once. That’s why it’s important to hire a financial planner to help you fill in the gaps and strengthen your potential for future success. Financial planners are specialists in market investing, tax planning, risk management and fiscal matters in business. Your best bet for the future of your company is to seek the services of an expert so that you can protect, preserve and grow your personal investment in your business.

Now that you know a little more about why a financial planner is important for small-business owners, you might be wondering what you can do as an entrepreneur to grow your income and save money. Keep reading for a list of things you can do to bolster your business.

5 things you can do to grow and save your money as a small-business owner

  • Be open to growth — You might already have a plan for your business, but creating a plan with help from a professional can be the most foolproof way of ensuring that your goals come to fruition. It’s always a smart idea to ask for guidance from a financial advisor about long-term goals and opportunities for growth.
  • Manage your debt responsibly — Responsibly handling debt is key to the success of your business. Defaulting on loan payments can lead to unfavorable impressions of your business. Financial advisors can help you effectively manage your debts and your loans so that you get the most for your business. Advisors also help you prevent missing payments and keep a stable credit score.
  • Invest in online marketing — Hiring a marketer to do your advertising might seem costly, but in the long run, this could provide astronomical benefits for your business. Finding the right marketing as a small-business owner is the difference between stagnancy and success. Financial planners may help you come up with affordable yet effective marketing plans. It’s also worth noting that while general marketing can be effective, what may be the most efficient way to sell your products or services is through digital marketing. Online marketing data can be tracked and analyzed and provides opportunities for larger audiences to find your business.
  • Find sponsors — Seeking out potential sponsors is one great way to boost the value of your business. Sponsors increase brand awareness and improve customer experiences. Finding sponsors is also a great way to build relationships and connections with other business owners, which could help you in the long run.
  • Enrich customer experiences — Going the extra mile to enrich the experiences of your customers might seem tedious, but it makes a world of a difference in the business world. Satisfied customers can be great for marketing and profit. The people who love your business and how your products or services make them feel are likely to tell others, which is free marketing and ultimately, can lead to a larger audience.

What can a financial advisor do for a small-business owner?

Overall, there is a lot that a financial planner can do for a small-business owner. With the help of one, you can rest assured that your business’s finances are being preserved and protected and that there is plenty of opportunity for growth.

Talk to a ProVise CFP® professional about how you grow and save your money as a small-business owner

At ProVise Management Group, our CERTIFIED FINANCIAL PLANNER™ professionals can get to know you and your current financial circumstances, goals, risk tolerance, and personal values to help you develop a plan that works for you. We can also create a written plan for you at a fiduciary standard of care. All our written plans come with an unconditional money-back guarantee. If you are unhappy with your written plan, you can return it to us, and we will refund 100% of the fee paid.

Are you ready to talk to a professional about how you can best grow and save your money as a small-business owner? Contact ProVise today to schedule a complimentary consultation.