With everything else a small business owner has to deal with daily, having a financial advisor to help keep both business and personal finances in order can be a big help. Not only will an advisor help you check where your finances currently stand, but he or she can also work with you to develop long-term goals and design systems to meet them.
Keep Track of Everything
So, what does a financial advisor do and how can he or she help your personal and business finances? Simply put, seeking the help of an advisor for your financial health can help you keep track of everything. Startups and small businesses can represent a sudden increase in the number of things that you need to be on top of. Not including doubling your financial records, you will also have to research products and markets, secure permits and licenses, plus deal with both customers and employees. It can be easy for some things to fall through the cracks when you are this busy, and long-term financial planning may be one of the first things lost in the process.
Plan for Future Growth
Being physically, financially and emotionally invested in your business is a good thing and can lead to the motivation to get everything done to meet and exceed growth goals. This perspective, however, can be detrimental in determining what long-term goals should be as well as setting medium and short-term steps to get there. When you work with a financial advisor, he or she can bring an outside perspective to the equation as well as the experience needed to set realistic goals and steppingstones. For instance, if you want to eventually sell your company and retire, then you need to have a plan in place for transferring ownership and for continued growth. Your advisor can help you make this plan as well as suggest growth opportunities you may not know exist.
Improve Efficiency
A financial advisor can help improve efficiency in your systems by looking at cash flow bottlenecks and suggesting ways to streamline processes. For instance, if you are running behind on orders consistently, then your advisor can bring a fresh set of eyes to the problem and determine if you need to simplify the process, hire additional personnel or invest in more equipment. Your advisor can also streamline your bookkeeping and help you develop a budget process that focuses on easing cash flow problems, reducing costs and increasing working capital.
Save Money
It may seem counterintuitive that hiring a professional advisor can end up saving you money, but the experience of a financial advisor is worth the cost to most small businesses. This frees up your accountant, or yourself, by delegating non-core finance tasks to a professional so you can plan for current and future financial goals without finding the time in your busy schedule. A fresh set of eyes can also spot ways to cut costs that you may have missed or see potential investments or issues that you are too busy to look for.
Retirement
It can be easy to get too caught up in running your business and keeping that set of books while letting personal finances slide. A financial advisor can help by coordinating with various personal and business professionals, such as attorneys, accountants and insurance agents, to make sure both you and your company are adequately prepared for future financial needs. He or she can also help you prepare a succession plan for retirement and coordinate the various documents and accounts which will be needed for that event. Small business owners can sometimes overlook the importance of financial advisors because of the cost but having this professional in your corner can save you money if not make you money in the long-term. An advisor brings a fresh perspective and an additional set of hands to your business and personal finances to help pave the way to a lucrative career and successful retirement.
