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Working with busy aspirational people is rewarding. 

We have found, no-one appreciates transparent, clear and personal advice along with the peace of mind knowing a job is done and done well more than these people. 

When we look at our client list, that is the common characteristic – very busy with work, personal life or a family. They all have come to us with personal and financial goals or aspirations. 

Are you someone that’s time poor but wants to get ahead financially?

The vast majority of our clientele are busy on either the work or family front and have personal and financial goals in mind. Usually, without the time to address it confidently and in a timely manner. 

With that being said, a lot of these clients also own a business.

If this is you, let’s deep dive into key advice to suit you, the busy business owner that wants greater financial freedom and return. 

P.S. Click below to get the latest free ebook

 See below our guidance on:

  • Common goals of a business owner
  • Considerations that shouldn’t be missed 
  • Easy mistakes that can cost you 
  • Our expert tips 
  • Why you need a financial adviser

 

Common goals of a business owner

We’ve found the top 5 most common goals and reasons for starting a journey of self employment are:

  1. Self determination
  2. Wealth opportunities 
  3. Lifestyle flexibility 
  4. Family legacy
  5. Self development

 

Business owners need to consider:

  1. Cash flow – this needs to be structured (preferably automated), measured and monitored closely. Whether it is personal or the business … This is the area where both success and stress come from. 
  2. Structure of affairs – This is where you should look to your trusted team of professionals; accountants, advisers and lawyers. It is so important to set things up with the end in mind, because that can be the difference between so many outcomes a few examples are tax bills, protection from creditors, where assets will go if you pass away and even insurance costs. 
  3. Superannuation – It’s the most tax effective environment we have access to in Australia. Yes it comes with restrictions, but it is also protected from creditors and a great way to save for the future and diversify away from the business. We see two things quite regularly: business owners either having no super at all, or others tend to explore purchasing their workplace within the self managed superfund space. It’s all about having something locked away for the future, none of us know what our business will look like in 5, 10 let alone 20 plus years. 
  4. Tax effective strategies – Accountants are crucial in this conversation piece and coupled with a financial adviser you can be sure you can legally get the best tax outcome available based on what your goals are. 
  5. Insurance from a personal/family perspective – what if something happened to you or your partner. Would your personal life be able to survive financially without you. Same goes for your business. It is important to have these risks mitigated where possible. 
  6. Estate Planning and Successional Plan – This ties in with having the end in mind. Asset intent is extremely important and having a plan in place from this before the event will make it easier for all involved. 
  7. Tax and regulation changes – Ensure you have a team of PROACTIVE professionals that adjust quickly to changes and ensure you are best positioned for success over the short medium and long term. 

Expert Tips:

  • Build an emergency cash fund (3-6 months) – we don’t have to look too far back to see why it is important to have some liquidity for things that are unexpected. It is also a good strategy for wealth building to be in a position to take advantage in times where others need to sell assets. 
  • Manage personal credit – try to not tie all debt back to your home. This ties back to a few points above in terms of structuring, intent and risk mitigation. It helps to have a lending specialist that can help based on your goals. 
  • Save for retirement and your personal family goals – Short term I can definitely understand putting everything into the business, long term, it really is a high risk plan and can be out of your control in some instances. Make sure all your hard work helps you achieve all your personal and family goals as well. It is easy to get caught up with tunnel vision for the business; use it to achieve your goals not to just hope that it will sell for alot in the year you want to retire. 
  • Invest in line with your goals and risk tolerance – when you do diversify, we suggest investing in quality assets over the long term. Just make sure it is appropriate to your own plan, not everyone else’s. 
  • Get professional help in areas you don’t know or have time to focus on, just like you would with your business. 

 

Easy Mistakes to make:

  • No clear separation between business and personal
  • Not having access to emergency funds – we saw the impact of that through COVID
  • Improper debt structures / plans for finance
  • Clear understanding of fixed and variable costs
  • Not having clear targets and a plan – business and personal (goals, targets and measuring lead to higher chance of success)
  • Not utilising all effective tax minimisation plans – tipping the tax man more than you should. Example – Shares of the business owned in a less tax effective entity eg personal name instead of a trust?
  • Ignore that costs rise over time without reviewing business pricing – good conversation with your accountant and business adviser

 

Why you need a financial adviser if you are a business owner:

  • You are used to hiring people to free up your time, this is no different. 
  • This person is kept accountable by you and by regulations to keep your best interest first all the time. 
  • Your financial planner is like an extra support to lean on to ensure your personal and financial affairs are taken care of … if not, be sure, they will let you know asap. 
  • Just like a great accountant works closely with you to get the most out of your business – a financial adviser will ensure you are achieving your personal financial goals.
  • Ensure you are building wealth outside of the business if that’s the goal and doing it in the most effective way. Do you want a nice house to live in? Etc.
  • A financial adviser can easily be one of your key points of contact to help manage all of your professionals (paperwork between them etc) saving you time and knowing it will be done well. 
  • A financial adviser can open up more tax effective doors for you to legally get the lowest possible tax outcome for your earnings over time. 
  • All of the above are even more important if you aren’t ‘financial’ 

We hope that you have found some value in this article, please feel free to reach out if you have any questions or would like to chat about getting started. 

Here’s some of our other content that may take some pressure off reaching out.

 – https://peakwm.com.au/initial-meeting-financial-adviser-expecation (What to expect in the first meeting with a good financial adviser?)

https://peakwm.com.au/what-to-look-for-in-a-good-financial-adviser (What to look for in a good financial adviser?)

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If you prefer to send an email question/query through the best address is info@peakwm.com.au or simply fill out your name, email address and a short message including your phone number will get back to quickly.

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