Small Business Financial Advisors and How They Help
A small business owner should consider working with a financial advisor as soon as the business grows beyond basic operations.
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What Is Financial Planning for Business Owners?
Financial planning is the process of creating a comprehensive plan to save and budget money for your future.
It involves proactive planning for life’s major financial events including:
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putting the kids through college
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buying a home or building your dream home
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starting or selling a business
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retirement or a work-optional lifestyle
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buying a vacation property
Usually, the ultimate goal of financial planning is to ensure you have enough savings to live comfortably when you retire.
For small business owners, financial planning requires taking a long-term approach that includes evaluating your financial situation, setting long-term goals, taking steps to accumulate money through budget-setting and savings, 401ks, IRAs, and more.
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360's Financial Planning for Business Owners
Financial planning for business owners requires the expertise of specialists who understand the unique needs and challenges of business owners.
Doing what’s right for the business and balancing that with what’s best for your personal goals is an art.
At 360 Financial, we help business owners and entrepreneurs create greater synergy between their long-term business and personal financial goals.
Our Services Include:
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Business Owner Cash Flow Planning
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Retirement Savings and Tax Strategies (such as implementing retirement plans (401(k)s, SEP IRAs, and SIMPLE IRAs)
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Risk Management
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Succession Planning
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Investments
Succession Planning vs. Exit Planning
Succession planning and exit planning are two different strategies that can be utilized by business owners who are ready to leave their business or retire.
Succession planning usually involves transferring the business to new leaders within an organization. Often this can involve family members or other key employees in the company.
Exit planning involves preparing a business for sale to a new owner or management team. Both have complex legal implications that require careful planning with the help of experienced legal professionals.
The Importance of Succession Planning
Succession planning is extremely important because all business owners will eventually need to consider what happens to their company after they leave or retire.
A well-considered succession plan can create continuity that ensures a smooth transition that keeps the business stable and profitable. Ideally, succession planning is a long-term process where future leaders and owners are identified and developed years in advance of the transition.
We usually recommend a 3 to 10-year time horizon to our clients.
Whether you’re passing the business on to a family member or selling it to a new leadership team, such as a private equity firm, the best succession plan should maximize your return while setting the new owner up for continued success.
5 Important Financial Planning Tips for Small Business Owners
1. Use an Experienced Advisor. There’s a lot at stake for business owners. An advisor that doesn’t have experience with the unique financial planning challenges of business owners probably isn’t the best advisor for you.
2. Keep Personal and Business Finances Separate. Mixing your personal and business finances can create headaches and complex tax challenges. It’s best to do separate financial planning for each, even though they ultimately end up impacting one another.
3. Maintain Good Credit. Keeping a good credit score gives you access to capital loans that can be used for improvements, growing the business, or even acquiring another company.
4. Manage Your Risk. Mitigating risk is essential for business owners. Having the right types of insurance, such as life, liability, property, key person, and health insurance, can protect you and your assets from risk.
5. Do Annual Reviews. You should meet with your advisor to review your financial plan annually and make changes as needed when business or personal circumstances change.
Getting Started with Estate Planning
Being a business owner adds complexity to doing your estate planning.
Yet it is vitally important to have a solid estate plan in place that outlines your wishes for how you would like the business assets distributed if you die or become incapacitated.
In many cases, a business owner’s net worth is higher, which may mean the estate could be subject to estate taxes at the state and federal levels.
Utilizing estate and tax planning strategies in advance can save your beneficiaries the expense and headache of probate and reduce their overall tax liability upon inheritance.
Business Planning vs. Personal Financial Planning
Business planning and personal financial planning are two separate disciplines.
Business planning and personal financial planning are two separate disciplines.
The level of complexity involved in managing income, taxes and investments is much greater for businesses than for individuals.
But if you are a business owner, it’s important to understand that your personal finances impact your business finances — and vice versa.
While each should be managed and planned for separately, you should do planning for both simultaneously to have the clearest view of how one impacts the other.
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Creating a Retirement Plan as a Small Business Owner
Creating a retirement plan as a small business owner is a complex process that should consider multiple factors.
It should be built around what matters to you the most and designed to support the lifestyle you envision for yourself in retirement. Since the business is likely your largest asset, its value when you sell it will be a key part of your retirement plan.
But just like any non-business owner, there are a number of other ways you should be investing along the way to grow your personal retirement wealth.
As a business owner, you’ll likely have more money to do it with and more opportunities to benefit from tax-deferred investments that can lower your personal taxable income.
Creating an Investment Plan
The value of your business is a key piece of your retirement planning puzzle.
But you should also be growing your personal investment portfolio in the years leading up to your retirement. Investments like 401(k)s, IRAs, or SEP IRAs allow you to grow your retirement accounts tax deferred.
The more successful your business becomes, you may be able to take cash distributions that you can use to further diversify your investments to include things like real estate, tax-efficient bonds, and emergency savings.
Your 360 Financial advisor can work with you on a holistic, tax-efficient investment plan that meets your personal goals while simultaneously benefitting your business.
Diversifying Beyond Your Business
It’s wise to diversify beyond your business because relying on its value to fund your retirement is not an ideal strategy.
It’s risky because it places too many proverbial eggs in a single basket. Not all businesses are profitable, and some lose money, or even fail altogether. Building a diverse portfolio of personal investments protects you in the event that the value of your business isn’t enough to fund your retirement.
We can help you with a variety of diversification strategies for both your business and your personal finances.
Managing Risk for Yourself and Your Family
With more money comes greater risk.
Our risk management specialists can provide insurance and other risk management tools for your business, as well as yourself and family.
One of the biggest risks to the value of a business if an owner suddenly passes away or becomes incapacitated. The abrupt loss of a key leader could be devasting to the company’s ability to function.
Important risk planning initiatives like key person insurance and drafting key legal documents that govern how a deceased owner’s shares of a company are distributed, such as buy/sell agreements, are musts for any business owner.
On the personal side, having life insurance for yourself can provide for your family if you die and give them funds to cover funeral expenses and any tax they may owe after they inherit your assets.
Additionally, having insurance for larger personal assets like your home, boats and vehicles as well umbrella policies for liability, are all smart ways to manage risk and protect your wealth.
The Importance of Financial Planning for Entrepreneurs and Business Owners
Financial planning for business owners and entrepreneurs is highly important because business owners tend to have more at stake.
As a business owner, you may have more money to gain or lose, and a higher exposure to risk and tax liability. A financial advisor and financial planner who specializes in working with business owners can help create and execute a holistic financial plan that includes budgeting, investing, and retirement planning.
A financial advisor can also provide guidance on business strategies for:
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lowering taxes
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managing debt
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finding capital
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tracking cash flow to ensure that the business remains financially healthy
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Work with a Wealth Management Team
The more wealth you have, the more you can benefit can from working with an experienced wealth management team.
The 360 Financial team’s 25-person team includes seven financial advisors with more than 200 years of combined experience as wealth managers, financial advisors, and planners with CFP®’s (Certified Financial Planner™), MBA, CLTC, and fiduciary investment credentials.
The 360 Financial team specializes in the following:
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investment and asset management
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cash and debt flow planning
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college planning
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risk management
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insurance planning
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estate planning
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retirement and income planning
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business planning
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tax strategies
How to Choose a Financial Advisor or Financial Planner
If you own a business, it’s important to choose a financial advisor who has extensive experience working with business owners and understands business tax planning and risk management.
At 360 Financial, helping business owners do financial planning for both their personal finances and their business is one of our specialties. Our advisors and financial planners understand the unique needs and challenges business owners face.
We can help you navigate impactful financial events to grow both your business and your personal wealth.
When to Start Working with a Business Financial Advisor
Different advisors have different thresholds for when they take on clients. At 360, our ideal client has $1M or more in investable assets or the ability to get there.
We’re not right for everyone, but we make a significant impact for the clients we work with.
The team at 360 Financial is not only knowledgeable and experienced but also incredibly responsive and accessible.
Whether it's planning for retirement, saving for our children's education, or building a robust investment portfolio, 360 Financial has been by our side every step of the way, offering guidance that is both strategic and forward-thinking.
In an industry where trust is paramount, 360 Financial has consistently demonstrated integrity, transparency, and a genuine commitment to their clients' success.
We wholeheartedly recommend them to anyone seeking not just a financial advisor, but a trusted partner on their journey towards financial prosperity.
Tom and Brenda Laska
Owners at Interior Care & Construction, Minnesota
My husband and I have been a client of 360 Financial for an impressive 20+ years.
Throughout this time, they have consistently exceeded our expectations in every aspect of financial planning and advisory services.
From the moment we first engaged with their team, we were struck by their professionalism, expertise, and unwavering commitment to our financial well-being.
They took the time to thoroughly understand our goals, concerns, and aspirations, crafting a personalized financial strategy that aligned perfectly with our needs.
What truly sets 360 Financial apart is their dedication to providing comprehensive and proactive guidance.
Client Testimonial
This statement is a testimonial by a client of the financial professional as of 04/03/2024. The client has not been paid or received any other compensation for making these statements. As a result, the client does not receive any material incentives or benefits for providing the testimonial.
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We specialize in helping business owners and entrepreneurs diversify and plan for succession.
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We ensure your money is working hard and invested in line with your business and personal goals.
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Keep everything under one roof when you work with our CPA partner, Rapacki.
Financial Advisory Services
360's Big Picture Planning
360's Advisory Team
Mike Rogers, AIF®
President and Founder
Mike Rogers is the President and founder of 360 Financial. As a fiduciary, he utilizes his 30+ years of experience to orchestrate and implement customized strategies.
Brian Bohnsack, AIF®
Senior Vice President
Brian Bohnsack is a financial advisor and the Managing Principal of 360's Elk River Office. Brian has a wide range of experience in financial services, accounting, insurance, and management.
Danielle Cain, CFP®
Associate Wealth Manager
Danielle Cain is a CFP® and holds a bachelor’s degree in finance from the University of Minnesota Carlson School of Business. She has her FINRA Series 6, 7, and 63 securities registrations held with LPL Financial.
Michael Urch, CFP®
Senior Wealth Manager
With over 10 years of experience, Michael advises his clients on all areas of wealth management. He graduated magna cum laude from Bethel University with a BA in economics and finance and a minor in mathematics.
Will Grant, CFP® CPWA®
Wealth Manager
As a Certified Financial Planner™ and Certified Private Wealth Advisor®, Will helps clients create their ideal life through values-based financial planning. His process is designed to pursue each client’s objective.
Dan Mahoney, CFP®
Senior Vice President
Dan has been a financial advisor for over twenty-five years, specializing in financial planning. He draws on many years of experience at Paine Webber/UBS Wealth Management.
Mitch Zweber
Senior Wealth Manager
Mitch is a financial professional focusing on portfolio and investment management, retirement planning, estate planning, and goal funding.
Tom Whitnah
Senior Vice President
Tom has been providing financial and advisory services to clients for 32 years. Prior to joining 360, Tom was at Morgan Stanley Smith Barney. He takes pride in crafting an investment plan to fit in with his clients’ goals.
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