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Writer's pictureTroné Fossum

How Can a Financial Advisor Help a Business Owner?

Updated: Nov 13

A financial advisor can play a crucial role in helping business owners seeking to manage and grow their business and personal wealth. 



How Can a Financial Advisor Help a Business Owner?


Running a business involves navigating a complex financial landscape, and having a knowledgeable financial advisor can make a significant difference. 


We will cover ten ways a financial advisor can support business owners focused on achieving their goals.  Remember that not all financial advisors can provide the services a business owner may need. So, look for a business financial advisor with experience helping business owners. 


You may get the best support if you’re guided by a financial advisory team with many specialists working together to provide holistic wealth management. 



7 Ways a Financial Advisor Can Help Business Owners


1. Financial Planning


A financial advisor plays a crucial role in business and personal financial planning. 


A financial advisor can develop a comprehensive plan that aligns with long-term financial goals, including growth strategies, funding plans, and exit strategies. Additionally, they ensure that personal financial goals, such as retirement and estate planning, are integrated with the business’s objectives, creating a cohesive financial strategy.



2. Tax Planning


Minimizing tax liabilities is a key concern for business owners. 


Financial advisors can implement strategies to maximize tax efficiency through careful planning and using tax-advantaged accounts and investments. They can also ensure that the business complies with all tax regulations and filings, reducing the risk of penalties and audits. This dual focus on efficiency and compliance often helps protect the business’s financial health.



A financial advisor plays a crucial role in business and personal financial planning. 


3. Investment Management


Managing investments effectively requires expertise and careful planning.


Financial advisors create and manage investment portfolios that align with the business owner's risk tolerance, time horizon, and financial goals.


They also provide advice on reinvesting profits into the business or exploring external investment opportunities. This tailored approach helps business owners make informed decisions that support their long-term financial objectives.



4. Risk Management


Protecting the business and personal assets from unforeseen events is essential. 


Financial advisors can evaluate and recommend appropriate insurance coverages, including liability, property, health, and life insurance. They can also develop contingency plans for economic downturns or natural disasters. This proactive risk management is much better than waiting for disaster to strike and reacting. 



5. Retirement Planning & Exit Strategies


Planning for retirement is a critical aspect of financial security. 


Financial advisors provide advise around establishing and managing retirement plans for both the business owner and employees, such as 401(k) plans and SEP IRAs.


They also assist in developing succession plans that aim to ensure a smooth transition of business ownership when the owner retires. 


A financial advisor can also develop exit strategies that align with the owner’s goals, whether through sale, merger, or passing the business to family members. This strategic planning helps business owners transition smoothly when the time comes.



6. Estate Planning


Efficient wealth transfer is crucial for preserving the business for future generations. 


Financial advisors work with a client’s attorney to create strategies to transfer wealth to heirs while minimizing estate taxes. They work with legal professionals to establish trusts, wills, and other legal structures to preserve and manage assets. 



7. Employee Benefits


Attracting and retaining top talent is vital for business success. 


Financial advisors can design competitive employee benefits packages, including health insurance, retirement plans, and other perks. They can also provide advice on setting up Employee Stock Ownership Plans (ESOPs) to give employees an ownership stake in the business.


These benefits help create a motivated and loyal workforce, contributing to the business’s long-term success.



Financial advisors can design competitive employee benefits packages, including health insurance, retirement plans, and other perks.


Common Questions


Should a small business have a financial advisor?


Yes, having a financial advisor can be beneficial for a small business. They help create customized financial strategies, manage cash flow, and plan for growth.



How can a business advisor help me?


A business advisor offers dedicated guidance on financial planning, tax strategies, investment management, and risk management, helping you make informed decisions as you pursue your business goals.



Can a financial advisor really help?


A financial advisor works towards optimizing your business's financial health, providing transparent advice and strategic planning. If your goal is to efficiently accumulate, preserve, and transfer wealth, working with a financial advisor may be wise. 



At what point is it worth getting a financial advisor?


It’s worth considering a financial advisor when your business is growing, facing complex financial decisions, or you need help with long-term financial planning and investment strategies. If you’re past the $1M per year mark, then it likely makes sense to have a financial advisor who can guide your financial decisions. 



Can a financial advisor really help?


Final Thoughts


A financial advisor can help a business owner with their business and personal finances.


This comprehensive approach ensures that business and personal finances are managed in harmony. For many business owners, the personal financial planning piece of the wealth puzzle is often forgotten. When you’re busy running your business, taking care of your investments and creating a strategic retirement plan can be difficult. 


Often, working with a fiduciary financial advisor or a holistic wealth management team can lift the burden and stress off your shoulders. We recommend that you schedule a call to see how a financial advisor may be able to help you and your business. 




Speak with a fiduciary advisor


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About 360 Financial


360 Financial is an independent wealth management firm with a team of specialized financial advisors and financial planners. As fiduciaries, 360 Financial’s advisors provide services to business owners, entrepreneurs, and professionals. We help investors with sudden wealth, retirement planning, tax planning, estate planning, and business financial planning. 


Headquartered in Minnesota, we serve investors across the US with online and in-person wealth management and financial planning services.






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360 Financial

360 Financial is an independent wealth management firm with a team of specialized financial advisors and financial planners.

 

Founded by Mike Rogers, AIF®, 360 helps investors with sudden wealth, retirement planning, tax planning, estate planning, and business financial planning. 

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