Top Financial Planning Tips (From our small business experts)
Wondering where to begin with financial planning for your small business? The task can be overwhelming. To help provide focus and actionable steps, our expert Business Advising Team is sharing their top financial planning tips for small business owners and entrepreneurs.
In uncertain times like this, financial planning can be easily pushed aside. However, to create long-term success, it is very important to pay attention to your financials and have current data so you can pivot as needed.
Having helped over 12,000 small businesses throughout the years, we see time and time again that having a plan and a road map makes a huge difference for a business’s growth and success. It allows you to assess your business goals and lays out how you will achieve them.
Take a moment to review these tips from our team of experts and keep financial planning top of mind for your small business.
Chuck Sinks, Director, Small Business Advising
KNOW YOUR FIXED COSTS
It’s critical to know what your monthly fixed costs are first. Then you can work your budget around your fixed costs and have a more accurate financial picture.
CHECK YOUR CREDIT SCORE
Actively checking your credit score allows you to make sense of where you stand. Once you know where your credit score lies, you will be able to determine the different types of credit that are available to you and at what interest rate. Plus, if your FICO score is in the moderate-to-high end (i.e., 650+), it may make sense for you to consolidate your debts under a single low-interest account. Click here to learn about the 5 C’s of Credit.
Eddie Landeros, Senior Business Adviser
THINK LONG TERM + CONSERVATIVELY
Cash is king. Always work on a budget and forecast what your cash flow is going to look like in the next 12 months. Business owners that survive recessions are those that have liquidity, good credit, access to capital and have been conservative with their money by not spending on unnecessary things and by thinking long term and conservatively.
Marsel Watts, Senior Business Adviser
REASSESS
Due to COVID-19, it is smart to produce interim financials to see where the business stands financially. In addition, perform an analysis of the profit and loss statement to see where the business is generating the most revenue and expenses and make adjustments as needed. It is important to reassess what is needed to operate and sustain the business. Based on the information, consider making operational changes.
