As a business owner, your time may be monopolized by running your business. That could mean your personal financial goals are being neglected. Here's what you can do to keep your personal goals on track while you run your business.
Business owners are incredibly dedicated, driven, creative, and possess a host of other qualities that that go into growing a successful business.
But such singularity of purpose can sometimes lead to neglect in other areas of life; namely, I'm talking personal finances.
Business is Going Great, but What About Your Personal Finances?
If there's one clear observation I've made during my time as a financial planner, it's that business owners tend to be consumed with "running the shop." While that may be great for your business, it opens up the possibility of losing out when it comes to achieving your personal financial goals.
I don’t say this lightly, and it's not just a theory. I have dozens of real-life examples where a business owner is right on target with everything she or he does for the business. She or he knows exactly the amount of revenue the company generated last year and the business's profit margin.
But ask him or her to supply a dollar figure representing her personal net worth or to list personal financial goals? Crickets. What happens all too often is that like so many other dedicated and successful business owners, personal financial goals and preparation are put on the back burner in order to get the business off the ground or poised for growth.
The All Important Exit Strategy
Also keep in mind that one day you want to retire too. I’ve worked with far too many business owners who don't have an exit strategy in place. Regardless of what you do, you will eventually want to retire one day so it’s important that you think of your work as a means to an end in some respects. Maybe you are a consultant, owner, or mentor if it’s a family business and you probably started the business because of something you are passionate about. This passion pays the bills and it also needs to fund your future.
Having an exit strategy in place for your future financial well-being and the well-being of your customers is an important component of balancing your personal financial needs with your business.
It's a Common Dilemma, But Where Do You Start?
Noticing this trend, I've created a framework for business owners who need guidance in handling the personal side of their financial lives.
Business goals and personal financial goals: the two should really be separate concerns.
· What if your business goes under? Are your assets protected?
· Or what if you'd like to contribute to a college savings plan for your child? Are your assets all tied up in your business?
In fact, this leads nicely into the approach I take to financial planning for individuals. At Lake Road Advisors, everything starts with your goals. By understanding what's important to you (other than business success), we are able to define clear goals for you, and then turn them into a blueprint for your success.
Your Goals: A Great Place to Start
Instead of hearing about markets or rates of return, you talk about your life's ambitions when you take a goal-based approach to financial planning. That way, your financial plan is based on your values, not some pre-determined checklist that's supposed to fit everyone's needs.
Building Your Plan
Turning goals into actionable plans then is just the beginning. Building a complete plan also involves things like assessing your current state of financial affairs, prioritizing your goals, committing to the process, and leveraging a network of trusted professionals to help you achieve your goals. That's the financial planning process, and it starts with your values.
- January 2018
- Dec 11, 2017 The Psychology of Saving Money: Why some do it successfully and others struggle Dec 11, 2017
- Nov 27, 2017 Why Your Child's 529 Plan Should Be Direct Nov 27, 2017
- Nov 13, 2017 Get on the Road to Financial Success with These 4 Behaviors Nov 13, 2017
- Oct 30, 2017 Know the Lingo - the daily market recap and how it affects you Oct 30, 2017
- Oct 16, 2017 The 3 Unbreakable Rules for Financial Success Oct 16, 2017
- Oct 2, 2017 Follow These Steps When Selecting a Financial Advisor Oct 2, 2017
- Sep 18, 2017 Why You Should Choose a Fiduciary as a Financial Advisor Sep 18, 2017
- August 2017
- Jul 24, 2017 How Am I Doing? Jul 24, 2017
- Jul 10, 2017 Do I Pay Off (Student Loan) Debt or Do I Invest Instead? Jul 10, 2017
- June 2017
- May 29, 2017 Diversification: The Right Way to Manage Risk May 29, 2017
- May 15, 2017 Having a tough conversation and helping your aging Parents May 15, 2017
- May 1, 2017 What Everyone Should Be Doing Post-Tax Season May 1, 2017
- Apr 17, 2017 Want to Raise Financially Savvy Kids? Try These 5 Steps Apr 17, 2017
- Apr 3, 2017 Inflation: What Every Investor Needs to Know in 2017 Apr 3, 2017
- March 2017
- February 2017
- January 2017
- Dec 26, 2016 5 Steps to Get Your Finances Ready for 2017 Dec 26, 2016
- Dec 12, 2016 How Much Should I Invest In My Company Retirement Plan? Dec 12, 2016
- Nov 28, 2016 How About What Not To Do With 401(K) Contributions Nov 28, 2016
- Nov 14, 2016 Keeping it All Together: How to Balance Personal Financial Goals with Running Your Business Nov 14, 2016
- Nov 1, 2016 Nervous About The Election And Your Investments? Nov 1, 2016
- Oct 16, 2016 30-Somethings: Why are You Wasting Time Following the Stock Market? Oct 16, 2016
- Oct 3, 2016 Will 30 Year Old's Ever Get To "Retire"? Oct 3, 2016
- September 2016
- Aug 8, 2016 Why Budgeting Doesn't Need to Be a Dirty Word Aug 8, 2016
- Jul 18, 2016 What Does a Financial Planner Do? Jul 18, 2016
- June 2016
- May 16, 2016 It's Urgent, But Is It Really Important? May 16, 2016
- April 2016
- March 2016
- February 2016
- January 2016