As a business owner, you wear several different hats throughout the day. From overseeing day-to-day operations to growing your team, more long-term considerations–managing the business’s cash flow, complying with tax requirements, planning your own retirement, etc.–can all too easily fall by the wayside.
One study from SCORE, a national network for small businesses, illustrates just how difficult it can be to juggle these jobs as a leader; the organization discovered 40% of small-business leaders are not confident they will be able to retire before the age of 65. Although the reasons for this vary across industry and regional markets, there is one shared factor that is likely contributing to this growing gap: 60% of emerging companies do not work with a financial advisor.
Just like planning for your personal financial future, planning for your company’s financial future is not a one-size-fits-all endeavor. However, with a financial advisor in your corner, you can start mapping both out, while also staying focused on what matters most: your business.
What services do financial advisors have to offer?
At their most basic, small-business financial advisors are professionals who can help you maximize the capital that goes into starting and running your business. However, that is only scratching the surface of what they can provide. Depending on your organization’s needs, you can work with your advisor to determine whether you need more specialized support, or if there are other areas of the business with which they can assist.
Some of the ways that a financial advisor can help you improve your business operations include:
● Spending and saving strategies.
● Tax requirements.
● Recommended accounts for operating your business.
● Cash flow management.
● Profit and loss analysis.
By working with a financial advisor to evaluate your company’s financial standing and find unnecessary costs, you can start reinvesting in your company. Whether that means hiring more employees, experimenting with new marketing channels or introducing new products, you are the one in control.
How can a financial advisor help you?
When you first set out to start a business, that do-it-yourself, entrepreneurial spirit was founded on a desire to not simply make a profit, but also to grow and thrive. Keeping your business finances healthy is key to expanding your brand and exploring new opportunities. That is not all a financial advisor can help with, however.
Potential advantages your organization can see by partnering with a financial advisor include:
Improve Your Benefits Offerings
For many small-business owners, establishing a benefits plan can seem both overwhelming as well as a highly time-consuming administrative task. However, a financial advisor can help. Although the scope of your financial advisor’s can be tailored to your unique needs, just some of their benefits-specific support can include:
● Consulting on the details and fine print of your compensation plan.
● Maintaining the health of your account.
● Overseeing current assets.
● Establishing and reaching impactful investment goals.
● Broadening your investment portfolio.
In addition to providing both you and your employees with a more effective benefits plan, your financial advisor can actually help you take on employee turnover in the age of the Great Resignation. The same report from SCORE found that 48% of departing employees shared that a lack of comprehensive benefits influenced their decision to leave.
Build a Portfolio Aligned With Your Goals
No matter which industry you operate in or the customers to whom you cater, your investments are critical when it comes to your long-term success. A financial advisor can work with your team to help diversify your business’s assets in an effort to generate higher yields while also lowering the risk of your existing portfolio.
Not only will a financial advisor work with you to determine your risk tolerance and allocate your assets accordingly, they can also:
● Provide insight into which assets make the most sense for your goals.
● Build short- and long-term cash flow needs into your investment strategy.
● Ensure your portfolio remains manageable.
A financial advisor is also able to offer you personal financial strategies outside of the business. This may include considerations such as how and when to retire, as well as identifying which investments may align most closely with your future lifestyle. Whether they are optimizing your capital for future business growth or preparing you for your post-career life, a financial advisor can help.
Develop a Future-Proof Strategy
As a leader, you have worked tirelessly to build your company. However, when you are prepared to retire, or to move on to your next business venture, you need a succession plan that ensures your hard work does not go to waste.
A succession plan can effectively “disaster-proof” your business, identifying qualified future leaders while also promoting training and development to address any existing skills gaps that could disrupt operations during a transitional period. However, despite these benefits, only 1 in 3 family-owned U.S. businesses have a robust and documented succession strategy, as found by Foster Swift Collins & Swift.
A financial advisor can work with you to develop an exit plan that not only aligns with your business’s long-term goals, but also ensures any liquidity needs of your own are addressed.
Partnering with a financial advisor
The most important thing to remember about a small-business financial advisor is they can provide far more support than simply executing trades in the market on your behalf. As a leader, you can lean on their experience to develop personalized plans that don’t just support your business, but also your personal financial goals. Part educator, part consultant, your financial advisor will help you navigate the financial complexities of your business, empowering you to focus your efforts on your employees and customers.
Interested in working with a financial advisor, or have any other questions when it comes to managing your small business? Our team of business planning experts are ready to assist you in the pursuit of your individual and professional goals.
The views expressed represent the opinion of Apex. The views are subject to change and are not intended as a forecast or guarantee of future results. This material is for informational purposes only. It does not constitute investment advice and is not intended as an endorsement of any specific investment.