Personal Financial Plan

Financial planYour business needs a budget, yes, but do you have one for you? Having a personal financial plan is just as important as having a business financial plan. This is for a few reasons. One is if you, as the business owner, is having financial troubles it will show through in your business. It will add stress to the workplace environment. It will cloud business decisions and lead to making bad business decisions.

Steps to help create a budget for you personally:

  1. Take a look at each area of your spending. Use your current spending patterns as an initial budget. I say this within reason. If your spending $3k a month on recreational activities you may want to take a look up front and see if you should cut back.
  2. Know your debt and come up with a plan to reduce and eliminate.  Try starting with your smallest debt and get that one paid off first.  Sometimes a victory is just the motivation you need to get pumped to get rid of excess debt!
  3. Build and maintain an emergency fund.  Having at least 3 months living expenses in a savings account reduces anxiety should a major expense come your way.
  4. Open or start contributing to an IRA. Whether or not it’s a Roth IRA or a traditional IRA.
  5. If you have a child start contributing to a Section 529 plan to help prepare for future educational costs.
  6. Have a set of funds that you can invest. Make sure you keep track of the ROI on this. If you have a low ROI or a negative ROI readjust.

Take the time to look at not only your businesses financial plan but your personal one too.

And, as always if you have any questions do not hesitate to ask. www.eagleeyebookkeepingservicesllc.com

Advertisements

Forecasting for Growth

GrowthTo be effective with a strategic business plan and project forward for growth starts with strategic thinking. In order to project forward business owners need to analyze several areas of their business and think of how each area could affect one another.

A miss judgement in any one area could result in the all too common “growing pains” expanding businesses find themselves in. The following areas are great starting points when planning and preparing for growth. Human Resources, Marketing, Accounting, Operations, IT and Customer Service.

Human Resources – Want to roll out a new product or take on more clients? How many additional staff do you need to do that? How will you train them? How much will you pay them?

Marketing – What venues or channels do you plan on using to get your marketing material out there? Calculating a ROI on marketing can be difficult but is necessary none the less.

Accounting – Putting a quantitative figure on all business activities will help you keep in line. Meaning that it will help you from over spending and help you know if you are being successful in your efforts or not.

Operations – If you are rolling out a new product do you have the machinery to make it or do you have the sourcing connections to import it? This area also connects with the other areas because you may have to hire and train direct labor and use accounting to figure out profits margins.

IT – Do you need different technology to pull off what you are trying to accomplish? Often times technology is not compatible with different or other pieces of technology.

Customer Service – Asking yourself if what you are doing will improve customer service or hurt it is sometimes over looked. But if you expand, get busy, and start experiencing growing pains then customer service is often one of the first areas that get affected.

So before you try to take on the world and expand. Ask yourself are you ready? And come up with a strategic game plan to get you there.

Questions?  Do not hesitate to ask.

www.eagleeyebookkeepingservicesllc.com

 

 

 

3 Best Business Tips

Cash Flow Forecast

 

I was searching around today for the best business tips. I came across many articles that included some great ideas. Some were practical, some were actionable and some were just OK. But of all the ones that I scanned through here were my 3 favorites.

 

  1. Always find new ways to keep costs low – This will help in two ways. The first is that it will increase your cash flow and strengthen your company. The second is that by focusing on expenses and vendor relations you may be able to establish a relationship with that vendor and negotiate better terms.
  2. Test and measure everything – By knowing what is working and what’s not you can stop wasting time on the activities that are not increasing profit and double down the activities that are. Leading you and your business to a more efficient and profitable business.
  3. Budget and monitor your business – Creating a budget for your business gives you focus on what you want to bring in and what you want to spend. And using that budget to monitor your business on a monthly basis helps you keep on the right path to increased profitability.

Staying on top of your business is on ongoing activity. Using financial statements as a tool to help monitor past, current and future activities will help you stay on track.

For more information – www.eagleeyebookkeepingservicesllc.com