Starting a Business: Financial Advice for Entrepreneurs

Starting a new business can be stressful no matter how seasoned of an entrepreneur you are. There are many factors to consider when planning to launch and maintain a business, especially when it comes to finances. Whether you’re planning to launch a new tech start-up, restaurant, or consulting firm, there are steps you should take to ensure the long-term financial success of your business.

Create a Business Plan

Before sharing your business idea with potential partners, investors, or employees, make sure you have a business plan first. A plan will be crucial to guiding you through the first few years of your business journey. The process of writing a business plan will help you understand industry risks, start-up costs, and other key elements to sustain your idea. The U.S. Small Business Administration (SBA) has helpful resources for building a business plan.

Track and Organize Your Finances

Think of a balance sheet as the foundation of your finances. This sheet provides a snapshot of your business financials and helps you keep track of your assets, liabilities, and equity. As a business owner, it’s important to organize your financial records so it’s not a hassle to track expenses down the line. Entrepreneurs can use a balance sheet to help separate financial data into categories, thus making the information easily accessible for you and your business partners.

Spend Wisely

Does your business need a large office space and new furniture right away? Depending on the type of business, fancy decor can likely wait. First, plan on buying exactly what’s needed and then keep track of future wish-list items. The same goes for products you’re selling – no need to have hundreds of items available in stock unless you know that product is in high demand.

Now think about the services you’ll need to help get your business started. It’s important to consider the value a service adds to your business and if it saves you time. For example, entrepreneurs may want to outsource their logo design to a professional. If the business owner has design skills, they could save money by creating a logo in-house. However, if hiring a designer saves you hours, then the extra investment might be worth it.

Plan for Tax Season

Tax season will look very different for new entrepreneurs. New business owners will need to plan ahead for taxes both in financial preparation and budgeting to avoid overlooking any tax obligations. Everything from choosing between an LLC and an S-corporation to the timing of hiring employees and purchasing equipment – will impact your taxes. It’s also recommended you save money each year to use toward tax payments. Overall, it’s a good idea to consider hiring a CPA to assist with filing business tax returns.

Work with a Professional

It’s always recommended new business owners work with professionals to help map out financial considerations. At First Financial, we can not only provide loans and accounts to eligible businesses, but we also offer business services to help entrepreneurs kick start their professional dreams.

Ready to get started? Call our Business Development Department at 732-312-1500 or email business@firstffcu.com with any questions.

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