Business Finance

Do You Need a Financial Advisor as a Small Business Owner?

You know your business – we know business banking. Our business managers will help you face the future with confidence, providing guidance when you need it and services that can help bring your business ambitions to life.

What Is a Small Business Financial Advisor and What we Do?

A small business financial advisor is a professional who will help you maximize the capital that goes into starting and running your business.

The most practical part about managing your business finances is that it keeps your business alive. But you didn’t start a business just to skimp by. You want your business to make a profit, scale, and thrive. Keeping your business finances healthy can help you achieve this.

Who Should Hire a Small Business Financial Advisor?

A financial advisor can be a useful resource for any business owner. After all, you’ll want the best advice available to you when making decisions about your business finances. 

If you’re young with little experience, hiring a financial advisor can be especially helpful. Many businesses fail in their first few years, and it’s often due to poor planning and costly mistakes. The expertise of a financial advisor can compensate for your lack of experience. They can help you make sound financial decisions for your business, as well as create a financial plan you can follow for the life of your business. 

That said, it’s never too late to consult a small business financial advisor, especially if you’re considering some big changes, enjoy gaining a new business, passing ownership to someone else in your organization, planning for retirement, and more.

Benefits of a Small Business Financial Advisor

Working with a small business financial advisor can have myriad benefits for both you and your business. Let’s explore some of these further.

Save Time and Energy

As a small business owner, you wear a lot of hats and are constantly switching between them. One minute, you might research a new marketing strategy. The next, you may be handling some customer service issues. With so much to do, not everything can get your full attention.

But the last thing you should put on your “I’ll get to it” list is your business finances. Poor bookkeeping, unsound financial decisions, and cash flow “clogs” can negatively affect your business. 

That’s where delegating your business finances to an expert comes in handy. While you’re running your business operations, a financial advisor will help keep the capital flowing, as well as help you develop a plan for what to do with that capital.

Save Money

Many small business owners might not know that they’re overspending in certain areas of their businesses. A small business financial advisor will evaluate your business finances and see where you can cut unnecessary costs. 

When you save money, you have more capital to invest back into your business and expand it by:

  • Hiring more employees
  • Exploring new marketing tactics
  • Releasing new products
  • Offering employee raises

As we mentioned, you will have to spend money to work with a financial advisor. However, as the saying goes, “you have to spend money to make money.” This business expense should lead to growth down the line.

Help Execute Your Business Plan

When you write your business plan, you can have grand ideas about where you want to take your business. Often, these goals can be financially unrealistic and you’ll need an aim perspective if you want to bring your business idea into fruition.

This is where a small business financial advisor comes in. Earlier, we mentioned that capital is like gas in a car. Your business plan is the coordinates you put into your GPS—while the directions are there, you won’t get anywhere if the tank is bone-dry. A financial advisor can help you put gas in the tank so you can get your business to its end destination.

Evaluate Market Trends

Some financial advisors will be more involved in the business’s execution, including researching market trends. Some markets are more competitive than others, and you’ll need an expert opinion on how your business will fare in such a market.

Market projections, advancing technology, and other factors can affect the growth of your business. You want to ensure your business is financially healthy so you can weather challenges and capitalize on opportunities. 

Investment and Retirement Planning

For many business owners, their investments are all wrapped up in their business with the logic that they can later sell their business to fund their retirement. While it’s natural to want to give your business everything you have, this is an unwise investment strategy. A healthy investment portfolio is one that is diversified. A financial advisor can offer personal finance tips and help you choose which investments work best for your unique situation, including when and how you want to retire.

As your business starts generating more revenue, your small business financial advisor can also help you decide how to invest this capital to continue growing your business.

Succession Planning

Whether retirement is a long way off or just around the corner, this isn’t the only instance when you should consider what will happen to your business when you’re no longer in charge. While it’s a more difficult conversation to have, you should create a plan for what would happen to your business in the event of your death or disability, known a succession plan. 

Your small business financial advisor can help you draft this document so there are clear instructions on how to keep the business running or prepare for its sale in your absence. 

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