How to Setup the Business Financial Goals that Align with your Personal Goals and You Can Achieve It
As a business owner, setting financial goals is crucial for the success and growth of your company. However, many people often fall into the trap of following other people’s goals and dreams. To avoid this pitfall, it’s essential to create a vision for your personal life that aligns with your business objectives. Here are some steps to help you set achievable financial goals:
1. Determine the Value of Your Goals
Before pursuing any goals, assess whether they are worth pursuing. Consider how they align with your personal values and aspirations. Dopamine, a neurotransmitter, helps us assess our progress toward particular things, so setting goals that excite and motivate you is crucial.
When drafting your personal vision, consider the following:
- How many hours do you want to work per week?
- What makes you excited to work on?
- How flexible does your schedule need to be? (e.g., dropping off kids at school or sports activities)
- How many vacations do you need to take per year?
- How much do you need to take home to cover your financial responsibilities?
- Do you enjoy managing a team? What is the perfect number of people you want on your team?
- Where do you want to work? (e.g., home office, outside office, or while traveling)
- How many clients or customers do you want to serve?
Remember, everyone’s personal preferences and circumstances are different, so your vision will be unique to you.
2. Set Challenging but Attainable Goals
Your goals should be challenging but not extremely out of reach. Long-term goals, such as those spanning 5 or 10 years, can be more ambitious, but short-term goals (under 1 year) should be more realistic.
Based on your vision, determine:
- The amount you need to take home
- The amount to contribute to your retirement account
- The amount your business needs to make
For example, if you currently take home $15,000 per month and your vision requires $25,000 per month, it may feel both exciting and scary.
3. Break Down Long-Term Goals into Short-Term Objectives
Avoid setting long-term goals, such as those spanning 5 or 10 years, without breaking them down into shorter-term objectives.
Our brains find goals less rewarding if they exist too far in the future, leading to the “middle problem.”
When starting a new goal, you may be excited, but by the second month, challenges and chaos can cause you to lose momentum and abandon your goal.
4. Implement the 12 Week Year Concept
The “12 Week Year” concept involves setting goals for 12 weeks instead of 12 months. This approach, rooted in neuroscience, can help you achieve your goals more effectively. Here’s how to implement it:
- Break your annual goal into 12-week chunks
- Focus on 1-2 goals at a time to avoid stretching yourself too thin
- For example, aim to increase revenue by 25% and profit by 10%
5. Create Weekly and Daily Action Plans
To achieve your 12-week goals, break them down into weekly and daily activities:
- Determine how many calls you need to make
- Identify key products or offerings to launch or promote
- Review your progress every week and adapt your strategies as needed
To make your financial goals a reality, utilize the following tools:
- Key Performance Indicators (KPIs) to assess your progress
- Budgeting to establish a framework for spending, investment, and tracking finances
- Financial reports, such as profit and loss statements, balance sheets, and cash flow statements
- Forecasting to predict whether your strategies and actions are moving you in the desired direction financially
By following these steps and utilizing the appropriate tools, you can set achievable financial goals that align with your personal vision and help your business thrive.
Managing Cash Flow and Business Growth: A Startup’s Struggle
Managing Cash Flow and Business Growth: A Startup’s Struggle In this episode of the Become Sensible podcast, we explore a real-life case that highlights the challenges many entrepreneurs face when balancing cash flow, seeking funding, and ensuring personal income. If you’re struggling to manage your business expenses and personal needs, this episode is for you.…
Continue Reading Managing Cash Flow and Business Growth: A Startup’s Struggle
Navigating the Multiple Member LLC Dilemma: Should You Switch to an S-Corp?
Navigating the LLC Dilemma: Should You Switch to an S-Corp? In this episode of the Become Sensible podcast, we dive into a common dilemma faced by many business owners—whether to remain with the LLC structure or switch to an S-Corp to optimize their business tax strategy. If you’re unsure how your choice of business structure…
Continue Reading Navigating the Multiple Member LLC Dilemma: Should You Switch to an S-Corp?
Helping Small Businesses Save Big with S Corporations: A Guide to Tax Efficiency
Helping Small Businesses Save Big with S Corporations: A Guide to Tax Efficiency In this episode of the Become Sensible podcast, we explore the S Corporation tax structure—a popular choice for small business owners aiming to optimize their tax strategy. If you’re curious about how an S Corporation can save you money, this episode will…
Continue Reading Helping Small Businesses Save Big with S Corporations: A Guide to Tax Efficiency
Managing Sales Tax and Finances for Creative Professionals
Managing Sales Tax and Finances for Creative Professionals In this episode of the Become Sensible podcast, we discuss essential financial strategies for creative professionals who sell products. If you feel overwhelmed by sales tax or struggle with balancing finances, this episode is packed with solutions. Why You Need to Listen Are you: Confused about when…
Continue Reading Managing Sales Tax and Finances for Creative Professionals
Proudly powered by WordPress
