Putting a competent financial team in place is key to achieving business and personal financial success
As a business owner, you have probably learned a lot about the technical aspects of setting up and running a successful business either by working with a business center or on your own. But what is lacking, in my opinion, is education on what to do when your business starts making money and strategies for creating value outside of your business.
The single biggest mistake that I see entrepreneurs make is not securing a really good financial team. This team should consist of a financial planner, accountant and attorney. Here are several reasons entrepreneurs give for not hiring a professional team:
- I can do it myself
- I don’t want to spend the money
- I will hire someone later when my business is making more money
Not hiring a team because you think you know what to do or trying to do it all is a big mistake. As a business owner, what is the best use of your time-spending hours performing bookkeeping tasks and creating financial statements or bringing in new clients?
Women entrepreneurs should spend the extra money to hire a good competent team that is willing to work together on your behalf.
Here is how the team can work for you:
- Financial Planner
Typically, your financial planner is the quarterback of the team. They can help you create goals and strategies in each area of your life (business, personal, financial security, etc.). Since this professional understands your goals as well as your hopes and dreams, it is important that your meet with your planner periodically to update your plan, goals and strategies. In addition, your financial planner can help you build wealth outside of your business.
Your CPA or accountant can help you achieve a working knowledge of your financials. In addition, the CPA should work with your financial planner to create tax planning strategies to help you maximize your income.
An attorney can help you with your business legal matters such as creating the appropriate business structure and reviewing contracts.
It is critical to have a team of professionals that are willing to work together because each area affects the other. For example, your business structure will determine what retirement plans you can use and in turn affects your retirement and tax planning.
By having a team in place, you avoid the consequences of:
- Not having a working knowledge of your financials
- Not effectively monitoring your progress towards your financial goals and business plan
- Not spotting roadblocks or problems that may arise
- Not putting strategies in place to build value outside of your businesses
One of the best strategies for achieving your business and personal financial success is putting a competent financial team in place.