Financial planning is one of the key components should you want to have a chance in the race to the top. All business owners simply must sit down to do it, either on their own or with the help of a professional. You should devote time to it because of all the financial planning benefits, some of which we will cover in this blog.
If you’re not sure what a financial plan is, then do check out this informative video. If you, on the other hand, are familiar with what it means, but you still haven’t done it, then here’s a bit of persuasion for you.
Why is financial planning healthy?
Reason Number 1: It takes some of the stress out.
When you have your financial plan in place, you can feel more relaxed with regard to potential emergencies you might face. We can never predict them, but we should always try to be prepared for them – the best way we can. If it so happens that you become ill, or business runs a bit slow at a given period, you will be reassured that it’s not all going to crumble.
Having that sense of financial security will allow you to live more comfortably, especially if you know that you’ve got an emergency fund available as your buffer.
Reason Number 2: It turns you into an achiever.
By laying out a plan, you will basically be setting your goals. As Robert Herjavec put it: “A goal without a timeline is just a dream”. So, by creating your financial plan you will stop being only a dreamer and instead, become a doer. The financial plan is such a great motivator for you to do the work to achieve your goals.
On top of this, a study has shown that 65% of people with a written financial plan say they feel financially stable and that 54% of planners felt “very confident” they would reach their financial goals.
And when you’re keen to advance in what you do, you most certainly become very productive. By doing so, you motivate those that surround you and create a generally proactive environment.
Reason Number 3: It’s got emotional and mental health benefits.
Financial planning is very much linked to mental health and studies have shown that those who do financial planning have average or above average mental health. Because knowing your finances and having a plan for the future has nothing but a positive influence on how we feel and how we live our lives.
We all know that feeling of motivation and determination that a healthy lifestyle gives. We take care of our health and feel positive and proud to have taken good action. The same applies to the health of our business. By knowing that the financial plan is there, we, as business owners, feel more at ease and we start living without the dreaded anxiety. As you would expect, financial anxiety is detrimental to our health.
Another positive aspect of financial planning is that business owners tend to be more optimistic about the future, which is understandable. Because when the bigger goal is divided into smaller steps towards it, it always looks (and is) more achievable. And a sense of achievement nurtures a positive mindset and good mental health.
So, because there are so many advantages to financial planning, surely you wouldn’t want to stay on the road of procrastination. Make sure you take the first step by downloading our FREE cash flow guide which is a great resource so you can start taking control of your finances. Or you can sign up for a FREE trial to Numbers Know How and gain access to a Cloud planning tool, tips, techniques and resources.