Financial Planning for Small Business

Being an entrepreneur can be a stressful and challenging endeavor, but it can also be incredibly exciting and rewarding. There is no end to the many financial, legal, staffing, marketing, and customer issues that will come up as you launch your business. 
Small and mid-size businesses are the core the of the U.S. economy. Entrepreneurship has been moving the American economy for centuries. In fact, in the U.S. small business continues to grow, with companies under 500 employees adding over 1 million new jobs (more new jobs than large businesses) and companies with less than 50 employees showing the largest growth, contributing to about 40% of new jobs, according to the Bureau of Labor Statistics. 
The U.S. small business administration reports that there are almost 10 million women-owned businesses, boasting $1.4 trillion in annual income. So this is clearly a healthy and growing sector. 
There is, however, a lot of conflicting advice out there for the aspiring entrepreneur. Hopefully, the following tips will help you navigate the journey of self-employment:
Personal vs Business Goals
In many cases, business goals can interfere with personal financial goals if expenses on the business end take away from personal financial planning. Striking the right balance between your business and personal goals is a key to achieving them.
Monitor Your Costs 
Reduce your debt, scrutinize your spending habits, and stay on top of your budget. Your income and expenses need to stay balanced to maintain a growing venture. Invest wisely, save your profits, and keep your overheads as low as possible. 
Taxes
Filing and paying taxes can be a long and painful process. Consider using professional bookkeeping software and working with a CPA.
Financing
Every new business idea requires capital to get started, and that means securing financing. Funding can come from a number of sources, and sometimes the owner needs to look for external funding within his or her social circle or even approach a financial institution. The external financing can be in the form of a loan, equity stake, or even advanced payments from customers.
Human Resources
Hiring the wrong people is one of the biggest mistakes made by entrepreneurs. Employees, partners, collaborators, etc., need to fit into the company culture you are trying to build. They need to be hard-working and flexible, as employees in startups often have to function in multiple roles. 
Network
Your contacts are a web of potential prosperity. Keep growing your list of people. Networking can land you a new investor, a great employee, a new customer, or a great mentor.
Service
No matter what else you are known for, be absolutely certain that no one could ever say anything bad about your services. Focus your efforts on providing top quality service that satisfies the needs of your customers, and then some. Go the extra mile. It will pay off. 
Get Your Business in Order
You need a savvy business advisor for your company, one who has experience with other entrepreneurs and who specializes in startups. An experienced advisor can help you:

•    Incorporate
•    Draw up contracts with any co-founders
•    Plan a business succession
•    Set up a retirement plan
•    Put together retirement and estate plans
•    Set up insurance plans (life, health, business, property, etc.)
•    Prepare key agreements for the business
•    Set up a stock option plan for employees

IMPORTANT DISCLOSURES
Material contained in this article is provided for information purposes only and is not intended to be used in connection with the evaluation of any investments offered by David Lerner Associates, Inc. 
This material does not constitute an offer or recommendation to buy or sell securities and should not be considered in connection with the purchase or sale of securities.
To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. 
Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances.
These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable– we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.
Some of this material has been provided by Broadridge Investor Communications Solutions, Inc.
David Lerner Associates does not provide tax or legal advice. The information presented here is not specific to any individual's personal circumstances. Member FINRA & SIPC