When I first launched my coaching business, I didn’t have a plan of action for managing my finances. As any entrepreneur knows, the first few months can be both hectic and exciting, and accounting and budgets might be the last things on your list. Dealing with money and numbers can feel daunting to some and boring to others. I tried to coast by using my mom, who manages our family business, for advice, and an accountant that she set me up with. And two years in to running my business, I still felt like I didn’t have a firm grasp on my own finances. Moreover, I didn’t feel like my team fully understood my business, and as a result, it was hard for me to feel confident about my money.
Last year, I decided it was time to make a change. I wanted to started taking control of my finances and I sought out a team of knowledgeable people that I could trust. I didn’t just need people to crunch numbers; I needed them to understand my business so they could help me in both the short-term and long-term. In the end, I found two great female entrepreneurs: Ashley Feinstein Gerstley, a money coach and the founder of The Fiscal Femme, and Pamela Kornblatt, CEO of The Tax Strategists. Working with this team, I found that dealing with money didn’t feel so overwhelming. In fact, as I began to be more aware of my budget, what I could put towards savings, and what I was saving for, my finances began to feel less like a chore and more like a tool for success.
If you’re an entrepreneur who has no idea where to start with your personal and business finances, here are some of the ways that a great financial team can help:
1. They can answer all your questions—even the ones you think are dumb.
Got questions? When you have a great financial team on your side, you can ask every money question that’s crossed your mind—even the ones that seem stupid to ask. When it comes to money, you might think that you should know the answer, even if you’ve never been taught. You might be wondering how to open a retirement account, how much to contribute to savings, or how to pay yourself as your business gets off the ground. The great thing about having a strong rapport with your financial team is that you won’t worry about asking stupid questions. They are there to help, and not only have they seen it all before, they can tailor their answer to your particular situation.
2. They can help you understand your unique personal and business finances.
Working with people who make an effort to understand everything that’s unique about you is a game-changer. Finance professionals who are also entrepreneurs will have first-hand knowledge about how your business differs from others, but anyone who is open to listening and diving deep into your finances can be a huge asset. An accountant can be helpful during tax season in particular, when they can help you identify what you can write off as a business expense and what needs to remain in the personal category. If you enlist the help of a money coach, they can help you look at the big picture, identify trends in your finances, and make projections for the future.
3. They can help you save and spend with intention.
When you don’t have a good grasp on how much you’re spending or saving, it can be easy to spend beyond your budget or forget (or decline to) to contribute to your savings. Working with a financial team to gain a clear picture of money in and money out is key to the overall health of your business. Your team can help you determine not only how much and how often you need to contribute to savings, but what you are saving for. Once you have an idea of your goals—both short-term and long-term—saving becomes a lot easier. You may decide you’re saving up so that you can attend a conference, bring on a consultant, or significantly grow your business over the next few years. Whatever it is, clearly defined goals will lead to relatively painless saving over time. The same goes for spending, too. When you are conscious about what you spend, and what you spend it on, you feel more in control of your finances, and you can more effectively and efficiently cut expenses that don’t contribute to your overall goals.
4. They can help you get organized.
When it comes to business finances, there is a lot to organize. Fortunately, there are also a lot of automated tools and tricks that you and your team can employ to maximize your chances for success. Even little things, like opening a new savings account that is completely separate from your checking account (making it harder for you to transfer the money back into checking), can make a huge difference. You can also open an account to save money that you can use for taxes at the end of the year. With both of these accounts, your financial team can help you determine how much you should be contributing on a regular basis. These contributions will be based on your monthly budget, which is another organizational tool that’s integral to your finances. Your team will be instrumental in helping you fine-tune your budget, and the document will serve as a road map for your business finances and decisions for the coming year. This is the best part about working with a financial team. You’re no longer spending or saving in the dark; you have a plan drawn up by a team of people who want you to succeed.