We’re a few weeks into 2018, so at this point 2017 is still fresh. What went right last year? Where do you go next? What was a series of unfortunate events?
For us, we want to interact with YOU more and provide more of what YOU want. We heard you loud and clear with your survey answers and 2018 is going to be a year of new offerings, more social media presence, and maybe even some videos coming your way.
So, we’re carving out time in January to get financially ready.
We can hear you thinking…
Why? Social media interaction, making videos, and providing new services has nothing to do with your finances.
Oh, but it does!
In fact, being financially ready — arming yourself with knowledge and getting your books in order — is the one thing you need to achieve ANY goals.
Let us explain why financial literacy is the one thing you need this year.
Whether your goal is to expand your team, test out a new social platform, or contribute more to your retirement account, all business goals have one common denominator:
- To pay new staff, you need money.
- To advertise, you need money.
- And to fund your retirement account, you need (you guessed it) money.
However, a recent study showed 28% of small businesses are in debt. If you’re in debt, how can you invest in new opportunities for growth?
Often, debt is attributed to a lack of financial literacy. In fact, the same study showed 81% of small businesses handle finances by themselves. But only 40% consider themselves to be financially literate.
That’s a hefty chunk of people who are managing their finances without the know-how.
How would you rate your financial literacy on a scale of 1 to 10?
(With 10 being a certified accountant and 1 being the Count von Count)
For an unbiased answer, you can take this financial literacy test.
In your first year of business, it probably made sense to save money and wear the financial hat. But, let’s be frank, your focus was on acquiring and retaining clients. If you had a few moments in between consultations to reconcile the books — swell.
Otherwise, your books got dusty. And anything you didn’t know how to do, like investing in retirement, got pushed to the side.
Things are different now. Instead of living paycheck to paycheck, you have a consistent income and a robust business model. There are more moving parts to your finances. But, you’re ready to grow.
To seek new opportunities, you need first to understand your business’s financial health and talk about it confidently.
Financially literacy will help you take control of every dollar in your business. You can sidestep debt, have the resources to hit all your goals, and increase your chances of success.
But, we’re not just talking about knowing the difference between gross and net profit.
You need to understand cash flow management, risk management, planning for retirement, and tax planning and reporting.
Riveting, right? Tackle one financial topic each week in February.
Start with the one you’re most interested in, like taxes or investments. And choose a learning format you enjoy, whether that be video tutorials, books (we have a few recommendations here), or podcasts (definitely listen to this one).
In short, don’t make the learning process more tedious than it has to be!
Finally, this year is also a good time to abandon the DIY approach and learn how to delegate tasks effectively. One of our clients, Kat Schmoyer, wrote about why she decided to hire a professional and eliminate some stress from her day. You can read it here.
So, tell us. How did you rate your financial literacy?