Financial planning is important in all aspects of life, in the realms of both personal and business. But for small business owners, financial planning may look a little different from the traditional plans your financial advisor will draw up for your personal matters. Continue reading below for a concise list of steps to try to follow while planning for the financial success of your small business.
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Keep personal and business finances separate.
This step will be paramount to the success of your business. Open a separate business banking account and credit cards and use those exclusively for business expenditures. This will streamline the process of tracking how much money you’ve spent and how much of your budget remains.
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Set money aside for the initial stages of development, then create a more comprehensive budget after you get it up and running.
When you’re just getting started on your small business journey, make sure to set money aside for the initial stages of development. While being meticulous about spending within your budget is important, it’s good to leave a little wiggle room for yourself in the early stages of development. Once you’ve settled into the day-to-day, you can create a more refined, exact budget to stick to.
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Monitor cash flow and expenses closely.
Set a budget for how much you’re going to be spending on business expenses, like travel, materials, and more. Try to stick to those numbers as best you can and monitor them closely to see where spending is higher than anticipated. For more information on tracking your spending efficiently, see above.
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Plan for contingencies.
Having a back-up plan is incredibly important in case things hit the fan at any point. Setting money aside or having a contingency plan in place will aid in the preservation of your business in case of an emergency.
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Consider the assistance of a financial professional.
If you’re a new small business owner and are just getting up and running, consider the aid of a financial professional to assist you in your journey. They may have tools at their disposal and experience that will aid anyone new to the process.
The opinions contained in this material are those of the author and not a recommendation or solicitation to buy or sell investment products. This information is from sources believed to be reputable, but Cetera Advisor Networks LLC cannot guarantee or represent that it is accurate or complete. All investing involves risk, including the possible loss of principal. There is no assurance that any investment strategy will be successful.
