Mar 09 Wealth Management For Businesses
Wealth management strategies are often discussed as they relate to high-net-worth individuals or those looking to cultivate personal wealth by utilizing various investment strategies. There has been much attention paid in the media recently, for example, to the relatively small number of individuals in the United States who consistently save a significant portion of their income; many individuals have little to no savings at all, let alone a comprehensive wealth management strategy and retirement plan. While this need for financial planning on the individual level is certainly relevant, there is also a need for businesses to plan for their financial future. On a personal level, individuals who have made financial missteps may be afforded a second chance at developing a wealth management strategy. For business owners, though, especially small business owners, a lack of financial direction can often be the demise of the business. With that being said, it is relevant to note that businesses currently suffer from similarly poor rates of financial planning as individuals do. It is estimated by some that roughly half of small business owners do not use wealth management or financial advisory services, whether that means employing an in-house accountant or hiring a financial services firm. Here is a look at the business wealth management landscape; companies interested in a long-term, sustainable financial strategy should consult with a Clifton NJ wealth management expert to get started on a plan that meets the unique needs of their business.
Financial Services Businesses Need
Business owners have an entrepreneurial, industrial, do-it-yourself mindset. It is this mindset that was the source of their interest and success in business in the first place. For this reason, they may be understandably reluctant to seek financial help. It can be enlightening, though, for these business owners to become aware of how other businesses use financial advisers. Many business owners, for example, seek professional financial help with cost controls. Cash flow management is also an area that businesses may partner with an advisor to fine tune. Towards the top of the list of financial needs for businesses are capital and financing needs, especially since the financial crisis in 2008, after which banks significantly cut back on lending. The financial advisory firms that have been the most successful in working with businesses of all sizes are the firms who have been able to assist in acquiring the capital necessary to keep businesses humming during difficult times.
Trends In Business Financial Advice
Although business owners will probably always tend to be reluctant to delegate financial responsibility, there are several factors contributing to their growing utilization of financial professionals. For one, the demographics of business owners are changing. Over the last few decades, businesses have been primarily owned and operated by Baby Boomers, who as business owners were notoriously reluctant to seek outside assistance. There is some evidence that as they near retirement, they may be softening their stance on consulting with wealth management professionals. Additionally, emerging younger business owners may be more likely to listen to outside advice about the financial operations of their business. A growing number of business owners, to note another demographic change, are women, a group who many studies show is also much more inclined to work with an outside wealth management firm.