By - May 21, 2024
Categories: Accounting, Bookkeeping, General
Every business owner envisions their financial future from the day they are established. As their business evolves over time, their vision may shift to reflect bigger goals.
However, along with the evolution of growth come factors that can block the road to their long-term financial vision. Read on to see if your current business finances align with the long-term vision you have and what to do to help you plan for success.
Is your business model designed for sustainable growth?
When you established your business, you likely dreamt of scaling. While your eye might be on the prize of expanding rapidly for maximum profits, doing so has the potential to throw a wrench in your sustainability.
It’s critical to identify whether your business model is designed for the scalability you want before entering growth mode.
Are you using updated, trending technology? Are you leveraging resources efficiently? Are you outsourcing roles to save time, energy, and money? Is your business optimized for flexibility?
If your answer is “no” to these questions, this is a clear indication that tweaks are required.
At the end of the day, sustainable business is key to long-term sustainable finances.
Are your business systems scalable?
Scalable business systems go hand in hand with a scalable business model.
If your long-term vision is to run your business with a hands-off approach, it’s important to develop manageable systems right out of the gate. Developing and implementing standard operating procedures paired with employee training will help you maximize your profits without increasing your overhead.
Will your revenue streams withstand market fluctuations?
Your long-term financial vision depends on your profitability over the course of time. Your current income may match your financial projections, but this isn’t guaranteed to continue year after year.
The market and economy fluctuate constantly, so it’s critical that your revenue streams are built to withstand the financial ebbs and flows.
We recommend using an online software program such as Quickbooks to track your revenue and expense trends.
Are you planning for retirement?
While it might seem like retirement is a lifetime away, now is the best time to begin preparing. Unlike conventional employment opportunities, business owners are solely responsible for building their retirement funds.
These are common retirement planning accounts we recommend exploring:
- Solo 401(k)s are designed for self-employed individuals
- Traditional IRAs
- Roth IRAs
- SEP-IRAs (self-employed pension plans)
Contributing to your accounts regularly will help your retirement align with your long-term financial goals. Our Financial Road Map can help you assess your current financial situation and create a retirement plan so you can begin putting savings aside. Click here to contact us about your specific financial goals and circumstances.
Are you currently working to establish financial stability and independence?
While your retirement savings is essential for long-term financial freedom, you’ll also want to plan for ongoing stability and independence.
Having an emergency fund to use for unforeseen situations, managing and paying down debt, and making educated investments will enhance your financial longevity. Opening insurance policies to cover liabilities, risks, and interruptions in business is also critical.
Receiving ongoing support from an experienced bookkeeper will help you regularly assess your finances to ensure you’re on the path to your long-term vision.
Book your free consultation here to learn how the Three Rivers team can help your business achieve the success you’re dreaming of!
