Does Your Small Business Need a Financial Coach?

Financial coach

In the realm of financial advice, a financial coach is something relatively new. Financial advisors, planners, and accountants have been offering their insights for ages, but not everyone is aware of how the more modern role of a financial coach can help you reshape your approach to business, as well as your perspectives on money. Here’s why (and when) you should consider reaching out to a financial coach.

What is a financial coach?

A financial coach is someone who helps you with basic money management skills. Their assistance can be especially helpful if you have a hard time managing your finances, want to get out of debt-related overwhelm, or if you simply want to improve your financial literacy in general. The ultimate goal is to empower you to make better decisions when it comes to your money, whether in a personal or business setting. Your coach will help you develop healthier money habits through education, eventually creating a tailored financial plan based on your objectives. This typically happens in a limited time frame, over a few weeks to a year, allowing your coach to check your progress and support you as you begin implementing the strategies they’ve taught. 

What skills can you learn from a financial coach?

They can give you a wide range of useful skills. Notably, they’ll help you become more aware of your own money habits, especially when it comes to expenses, by coaching you to track your own financial movements. They can also help you set specific financial goals, whether it’s the personal goal of creating a budget or the desire to eliminate your business’s debt. 

Business leaders can also benefit from their advice on specific and complicated financial issues, such as complex taxes or the best practices in terms of finance for your industry. Best of all, a financial coach will support you and hold you accountable as you put these skills into practice, making it easier to create habits that truly stick.

Should you get a financial coach?

Whether you’re seeking financial help with a specific issue, or you’d simply like to learn better money management strategies, a coach can help empower you to create your own financial success in the long term. What’s more, financial skills are endlessly practical! You’ll be relying on the habits you create for the rest of your life—and they can truly help you learn to master your money. Fortunately, if you aren’t sure you need extra help, you can always consider a trial session or short-term coaching to see if the coach brings value to your company or personal finances.

As a business leader, you should always aim to be learning and improving your skills, and there are few skillsets more practical than financial literacy. If you’re on the fence about coaching, don’t hesitate to give it a shot to see if it’s right for you. You may be surprised to find that your financial coaching becomes a solid investment that truly pays for itself in the long term.

When to Hire a Small Business Accountant

Small business owners sometimes feel reluctant to seek out extra help for their business, especially because help tends to cost money. This is especially true when it comes to finances, which most leaders understand at least at a basic level—making it easy to convince themselves that it’s fine to do it on their own. 

But accounting for small businesses isn’t quite the same as basic bookkeeping, and it’s important to decide whether your business needs some extra support. 

Can you take care of your own small business accounting?

Some business owners swear that a good accountant can save you significant money and headaches down the road. After all, business finances can be incredibly complex at times, and it sometimes pays to have peace of mind. But the truth is that your needs depend entirely on your situation—because doing it yourself can be a perfectly viable option. 

You may not need a financial accountant if you have a simple, uncomplicated business, such as a sole proprietorship, or if you’re a freelancer with just a few clients. In cases like these, go ahead and do your own small business accounting by managing your own income, expenses, budget, and taxes, as long as it doesn’t eat up the time you need to run a successful business. Remember to always calculate the value of your time in your business when making spending decisions. Are you better off doing your own accounting, or in spending the time in your business?

In what situations should you reach out to a professional financial accountant?

While less complex business structures don’t necessarily need the help of an accountant, there are times where the extra help can pay off—literally. One study by Intuit, the maker of QuickBooks, found that 89% of small businesses say they’re more successful when they work with an accountant. Specifically, there are a few cases where larger organizations will definitely want the expertise of an industry professional, even if you do part of the work yourself:

Filing your taxes. This one is obvious, as it’s one of the most well-known parts of an accountant’s job. When it comes to your business, an accountant can help you determine the correct forms and deductions to fill out, giving you a little more peace of mind.

Forming (or reforming) a business. A financial accountant can advise you on the best legal structure in terms of taxes and liabilities, and help you do the financial analysis you’ll need to write a business plan. If you’ve started out with a simpler business structure that’s limiting your growth, an accountant can also help you reshape your business’s structure in a way that makes the most financial and legal sense.

Acquiring relevant licenses. An accountant can help you obtain the licenses and documentation you’ll need, including a business EIN, employment accounts, sales tax permits, and more. This can be especially useful if you run a business in more than one state, or in some cases multiple cities, as your needs can vary from place to place—and an accountant can help you find and fill out the documentation you actually need. 

Bookkeeping assistance. While you may not necessarily need an accountant to do your bookkeeping for you, you can still ask for their insights and expertise to help you run your business’s numbers on your own. To help you get started on the right foot, an accountant can also create a tax plan for your new business, which can help you understand which deductions to record for tax purposes. They can also work to find the right bookkeeping software for your needs, and offer advice on tracking expenses and other day-to-day financial issues that might come up.

Compliance. In certain states, compliance issues can be difficult to navigate, and the problem is worse if you do business in more than one location. A professional accountant can help you ensure compliance with everything from sales tax to payroll complications.

When should you hire a financial accountant on an ongoing basis?

While it’s true that doing your own bookkeeping is a great way to cut costs in the early stages of your business, you may eventually want to have an accountant manage your books in order to free up your time, or the time of key leaders in your growing organization. But even if you keep all of your bookkeeping work in-house, it may still be a good idea to reach out for financial help on an ongoing basis. While some small businesses choose to only get in touch with their accountant during tax season, it can be helpful to meet more regularly. Depending on your needs, once a quarter or once a month might be as often as you need, but even this can make a world of difference to your organization’s finances. 

Having an ongoing relationship with an accountant can help keep you on top of potential financial issues before they grow more complicated. For example, an accountant can help you navigate any compliance issues as they crop up. They’ll ensure that your quarterly tax payments are correct, especially if your business is currently growing, as the numbers will change over time. 

Best of all, as an outsider approaching your organization with fresh eyes, a good accountant can help give you big-picture financial feedback to help you manage your organization. This can mean things like offering overviews of your cash flow patterns, insights into your inventory management or pricing structure, and advice on your property leases. Breaking these complicated patterns into charts, graphs, and financial forecasts, an accountant can help you find any potential areas for growth and better understand the ins and outs of your business. Essentially, as you work toward specific business goals, an accountant can help provide the financial expertise and support you need to get there.

Ultimately, the amount of contact you have with your accountant is your decision, but seeing one regularly can help you stay on top of financial concerns as they arise—and eventually start bringing in more profits in the long term.

How To Guide Your Employees to Empowered Decision-Making

How to guide your employees to empowered decision-making

We live in a time of the open-door policy. In the last thirty to forty years, the average leader has become much more accessible to their people—which isn’t a bad thing. I’ve always believed wholeheartedly that leaders should be on the ground with their team, as it’s one of the things that separates a leader from a boss.

But at the same time, there is such a thing as too much accessibility … and you might recognize it when you see a long line waiting by your door for help making important decisions. You’ve hired a group of leaders to lighten your load, ensuring that you don’t need to be involved in every detail of the company’s processes. So why are you making their choices for them? If you’re ready to help your senior leaders to step up and start making decisions of their own, here are the steps you’ll need to take.

1. Adjust your mindset.

You must be ready for this. You have to get yourself to a place where you trust the people you’ve hired. It can be a difficult mental shift, especially if you’re used to making decisions and haven’t really let go since you moved up the career ladder. But what’s the worst that can happen—they’ll fail?

Let’s talk about that for a second. You need to be open to the possibility of failure. It’s the best way for your employees to learn. Failure is part of reality, and as a leader, you have to be ready to let your employees fail (and to let them learn from it).

2. Ease into it.

To help your people get into the decision-making mindset, you’ll need to take things slow. The temptation is to just proclaim that you aren’t making decisions for your employees anymore. But this isn’t going to work: you aren’t there yet, and neither are they.

Here’s a better way. Start reviewing their decisions. When they ask you what to do, rather than simply offering up an answer, encourage them to tell you what they think is best and why. Once they’ve explained, you can tell them why you agree or disagree, bring up any points they missed, and share your strategy for making this type of decision. 

This does a number of things. First, you teach them your thought process, allowing them to start making similar decisions in the future. Second, it gets them in the habit of thinking things through, encouraging them to prepare a solution and rationale before they even walk through your door. Third, it empowers them. When you hand the decision-making process back to them, they feel important, understanding that this is something they can do on their own. Lastly, it creates accountability. When you’re the one making the decisions, the responsibility is on you. When you share in the process with your employee, that accountability flips back to them, ensuring that they can’t pass the buck upstream.

Over time, you’ll grow more comfortable allowing your people to make critical decisions, and they’ll be more comfortable making them. Eventually, you’ll find that the line outside your door has grown smaller, allowing you to consider the big-picture issues a leader should focus on—and you’ll have empowered your employees to bring more value to the table.

Do You Actually Need a Financial Manager for Your Business Taxes?

Do You Actually Need a Financial Manager for Your Business Taxes?

As an organizational leader or business owner, it can sometimes feel like you’ve signed up for a crash course in every aspect of corporate strategy. As a result, you’ll likely consult with many experts over the lifespan of your company, allowing you to get expert advice on major decisions, and it’s no different when it comes to complex issues like business taxes. A financial consultant or in-house finance director can help oversee your organizational costs and strategy, help you evaluate your company’s strengths and weaknesses, and—most importantly for today’s blog—assist you with complicated corporate tax matters.

What does a financial manager or consultant do?

The answer to this question can vary a little depending on your organization’s size, industry, and location. However, in general, financial managers are responsible for ensuring your organization’s financial health. They’ll make sure your organization complies with critical business regulations, and they’ll offer advice and strategies based on their knowledge of business law and the overall market.

When it comes to your business taxes specifically, a financial manager will help ensure that you adhere to all relevant tax laws. They’ll also help prepare and manage your yearly tax documents and offer advice on any related issues that come up during the process. 

What are the advantages of having a financial manager?

For most leaders, especially those without a background in finance or in corporate taxes, making crucial financial decisions can be both difficult and time-consuming. Most can’t spare the extra effort it takes to research and document the information they need, especially for complicated matters like corporate taxes. Fortunately, financial managers can help you weigh these crucial financial choices, or they can even take the bulk of the decision-making work off your plate entirely, allowing it to remain in the hands of an expert. Using their background and experience, they’ll help you move forward using the strategies best suited for organizations of your size or type in the current market. 

In terms of business taxes more specifically, there are a few ways a financial manager can help. On top of tracking and organizing your year-end tax reporting process, these consultants keep abreast of the latest industry trends and updates as well as any tax law changes related to your specific niche. This allows them to propose strategies (and to work with the latest software and technology) to help you lower your tax risks and even save you money in the long term. For particularly complicated matters, they can also consult with their network of professional financial advisors for niche solutions.

The key takeaway is that seeking professional financial advice is a sound strategy for any organization, and it can help free up time for you to tackle the big-picture strategic choices a leader needs to manage. Decide how much support and hands-on assistance your organization requires in order to choose between an in-house hire or a consultant, and stop letting your corporate taxes be more complicated than they should be.

Top 5 Myths About Executive Coaching

Myths About Executive Coaching

Executive coaching is a great resource for organizations. It helps people clarify their goals, gain self-awareness, develop key habits, and unlock their full potential faster than if they did it all alone. But throughout my career as both an HR executive and my career as an executive coach, I’ve found that there are a number of misperceptions about this kind of coaching that keep people from seeking it out. Let’s focus on 5 big myths about leadership coaching.

1. Professional coaching is only for executives.

There’s an old perception that a lot of money is funneled away into coaching, and so the only way to get a good ROI is to focus only on the executive team. Today’s reality is that 85% of coaching goes to executives—but the number one piece of feedback I’ve gotten from these executives is that they wish they’d had coaching earlier in their careers. Plus, the fact is that coaching is actually more successful when started early. This comes down to neuroscience: studies show that when the brain learns something, it physically molds itself to that learning. This means that the earlier you develop the plasticity of your brain to think with a growth mindset the better, as this can literally rewire your habits and reactions. I’ve seen this in action when working with my mid-level manager clients: they grow through the organization much faster than if they’d waited to be an executive to get coaching.

2. Training is sufficient to develop people.

Training—whether it’s a seminar, a book, or a class—is the go-to way for most people to further their careers. But the reality is that it isn’t sufficient. At a seminar, you’re learning what they want you to learn, and not everything will apply to your situation. Worse, studies show that 90% of what you learn in training will be forgotten in just two weeks. Executive coaching, on the other hand, is much more effective  because it’s tailored to you, it’s ongoing, and it happens in the context of your job. You get coaching on exactly what you need when you need it through on-demand learning, and you can put the tailored strategies into practice right away. 

3. Executive coaching is for underperformers.

I see this a lot: someone hears they’re getting a coach, and they think, “Oh my God, I’m getting fired!” That’s not the reality: executive development is effective when an organization invests in someone they believe in. Think about high-performance athletes. They have personal coaches, sometimes a lot of them, in addition to team coaches. This army of people helps them move from good to excellent, and it’s the same for organizations: anyone who is growing can benefit from coaching to reach excellence.

4. I don’t have the time for leadership coaching.

We hear that for everything: we never have enough time. But do you have the time not to have a coach? The reality of coaching is that it happens within the context of your job. In other words, you aren’t heading out to attend a seminar that might not apply; you’re working with a coach during your job and learning as you go, freeing up time and learning to be more successful at the same time.

5. Professional coaching is too expensive.

It’s true, coaching is one of the most expensive kinds of leadership development you can get, but is it really too expensive? Again, ask yourself if you can afford not to get coaching? From a results standpoint, there can be a big cost in not coaching, especially if problems and inefficiencies are constantly draining away your time, effort, and money. The investment may be costly, but coaching has a high ROI, paying off ten times over. 

There are many more myths out there when it comes to professional coaching, but these are the top 5 misconceptions I’ve found most common. When you consider the value of leadership coaching, it’s really a no-brainer—and hopefully, these myths have helped you see that.