Everything about my day today had to do with budgeting and retirement planning.
My first meeting was with someone that had concerns about his sister, a widow who had just recently retired. Her social security and very small pension barely made the mortgage payment on her home and paid utilities. Upon further conversation she had no savings and her home did not qualify for a reverse mortgage due to a lack of equity. Wish I had some other solutions other than inviting her to live with his family. Their problems aren’t over as she has no long term care insurance.
Later today I attended a very good seminar on investing presented by a group of very knowledgeable and successful “money managers”. Their goal was to bring the successful investment techniques to the small business owner. Unfortunately, not all small business owners have over 2 million dollars in a retirement fund; that was the example they traced back over a ten year period.
Earlier this evening I visited an owner of a small CPA firm and asked him how many of his small business clients (10 or less total staff) had a retirement line item in their budget. I was not surprised to hear his answer,” less than 5%”.
In my personal practice, I find that budgeting and accounting are the two most neglected areas in a small business. I can understand why. First, budgeting/accounting is almost never taught in high school, and unless you are an accounting major, you won’t have any exposure to it in college. Second, many new businesses put that off based on a positive attitude that it can be taken care of when the money starts “rolling in”.
There are so many good accounting packages available today that are easy to use. Take the time to talk to your coach, mentor or financial planner about a budget process for your business and how to implement a retirement program into your business life. There are courses available on this subject. I tell my clients that they should run their businesses as if they were planning on selling it in the next five years. The first thing a buyer will ask for is a financial record of the business.
A complete business plan should have within its structure a marketing plan as well as a financial plan. In a small business the financial plan of the owner should be incorporated into the financial plan of the business.
As a business owner your area of expertise is in the product/service you are providing. The planning portion (business, marketing, and financial) is out of most small business owners’ area of expertise. The best investment, no matter what the age of your business, is to find a qualified coach to walk with you as you grow your business.
No matter what happens to our economy, there will always be those who will succeed because they planned for it.
It’s good to be in business for yourself, but not by yourself.
Make it a Successful Today!