Are You Too Busy to Plan for Your Business?

I have many jobs. Full time mother, president of Jeanne Brutman LLC, part time office manager, home manager (someone has to monitor the refrigerator to make sure it stays full!), contact manager for significant other/friends/family.

There are only 60 minutes in an hour, 24 hours in a day, and seven days a week (168 hours or 100,080 minutes). Why the math? The reality is, except for leap years, we never get allotted more time, and thus the excuse that you do not have enough time is ridiculous and even juvenile. It reminds me of something my daughter would say in reference to her homework, chores or even brushing her teeth. Excuses are easy. Taking definitive action is hard.

There are some things in life too important to place on the “I will get to it” list. Steve Jobs just died and all would agree he was a pretty busy business owner.  He had, in 2007, over 20,000 full time employees, four children, a wife, and he also helped direct a movie or two. And yet, it seems, Steve was able to find time to do his planning. A recent Forbes article said that Steve met with attorneys and did his financial planning. The excuse that you are too busy running your business is just procrastination. 

When I make a plan, I actually spend less money, time, and effort on the task than when I just push blindly forward. Let’s take for example, the supermarket. Armed with a list, I’m a whiz in the store, go right in and out, and I don’t have to make another trip for a week.  Without the list, I end up buying things I don’t need, not buying things I need and making several trips over the course of a week. It really does work. 

And I truly believe, the more important a topic is, the more important it is to take the time out to plan for it. How many hours did you send researching your last car / truck purchase? Your last home? The last business you purchased? These are all lesser decisions.

So how should you get started?

1.      Make a list of all your assets with fair market value, debt owed on asset and net value (this takes one hour)

2.      Get a six month profit and loss statement from your accounting professional. Know where your business is right now. This takes one to three emails—if it takes more than that, time to get a new professional.)

3.      Get a copy of the last three years of your taxes, personal and business. Know what your business has done for you and the economy. Notate the following (maybe 30 minutes):

• Gross sales for each year
• Total taxes paid each year
• Total take home for each year
• Total retirement contributions for each year

4.      Make a personal and business budget. Know your cash flow by month and by year. Rough is good enough (say two hours). Use checkbooks, bank statements, bookkeeping records, etc.

5.      Go to the following professionals (approximately 12 hours):

• Forensic accountant: to review and assess the last year’s taxes for errors. (It’s better to pay for this today than pay high taxes for 20 years or face an audit for errors you did not know where there.) Do not let your present accountant/CPA talk you out of this.
• A lawyer that specializes in trust and estate planning. Do not use your real estate guy or corporate guy or any attorney other than a specialist in this area.
• A MDRT http://www.mdrt.org/about/index.asp member to review life, disability, long term care, health, cancer, dental, and vision insurance.
• A multiline broker for just property and casualty insurance for the business and personal possessions.
• A fee-only financial planner that does not hold assets to review your investment portfolios. If they hold investments, they will want your assets and may just trash your present portfolio. Avoid the conflict of interest unless they are a fiduciary.

This will get the biggest items on the right path. I would also suggest having the following financial products reviewed:

• Group benefits and employee handbook for your company.
• Business legal agreements (between partners, employees, clients and vendors). Please use the appropriate attorney. 

In total, to do everything I suggested would take a few days’ time, and you would benefit greatly in knowing where you are, where you are going and how to get there.

If you lack any of the professionals I suggested, please email me at jeanne@jeannebrutman.com.

P.S. On November 16th, 2011 I will also be starting a free 12-part teleseminar about financial planning. To register, visit www.askjeannebrutman.com to register. The only thing worse than paying for financial advice is not paying for advice because you may be “sold” something that may or may not be in your best interest.

*All investment advice given by Jeanne Brutman is just opinion. Please consult with your financial professional for a more thorough discussion of what is appropriate for you.