5 New Year Financial Planning Tips for Your Small Business

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Cheers to the new year! As another year comes to a close, there’s hope on the horizon for what the new year has to bring. Regardless of your small business’s industry, services, or processes, it’s essential to create a plan for your business’s financial success.

At the beginning of the new year, we recommend these five financial planning tips to help your small business grow!

Five financial planning tips to help your small business grow.

Financial Planning Tips

1. Conduct a year-end review.

To get started with the financial planning process you should first conduct a year-end review. Investigate your small business’s finances from the previous year to determine whether or not your financial goals were achieved. Assess what enabled your business to achieve its financial goals and make note of any areas for improvement. Be sure to also assess the overall business goals of the previous year. What goals did you achieve? Where did your small business fall short?

2. Create a budget for the new year.

Following your year-end review, it’s time to create a budget for the new year. This process doesn’t have to be difficult. It isn’t much different from creating a personal budget. At the end of the day, you want to make sure that you’re not spending more than you’re making. You want to build wealth, not debt!

Here are a few simple steps to create a budget for your small business:

Determine what you have coming in.
List your expenses.
Assess your savings goals.
Implement a safety net for emergencies

3. Set short-term and long-term goals.

Your overall business goals are directly related to your business’s financial success. To ensure that your small business is headed toward a lucrative future, you should create short-term and long-term goals for the new year.

Creating goals can be surprisingly difficult as it’s far too simple to come up with goals that are too broad, too narrow, or even unrealistic. The Corporate Financial Institute recommends using the SMART goals framework. SMART is an acronym that stands for Specific, Measurable, Achievable, Realistic, and Timely. This framework ensures that the goals you create for your business will contribute to its success.

4. Determine implementation strategies.

Once you’ve determined the short-term and long-term goals for your small business, you’re ready to create the roadmap to achieve those goals. Review the departments in your organization and decide the roles they play in your business’s success. Create a plan to engage your team in your short-term and long-term goals. Their engagement is essential!

A piece of paper with financial planning charts with a calculator, notebook and a pencil resting on top.

“Failure is success if we learn from it.” -Malcolm Forbes

5. Establish checks and balances.

As Malcolm Forbes once said, “Failure is success if we learn from it.” To ensure that your business is following its budget and effectively achieving its short-term and long-term goals, you will need to establish checks and balances. Whether you choose to review your business’s budget weekly, monthly, or quarterly, it is essential to schedule check-ins. Use this time to assess what enabled your business to achieve its financial goals and make note of any areas for improvement (as with the year-end review process). Make the most of the time you’ve already spent planning your business’s financial success!

Don’t let another year go by without setting up your company for financial success! It’s as simple as these five steps: conduct a year-end review, create a budget for the new year, set short-term and long-term goals, determine implementation strategies, and establish checks and balances.