Owning and managing a small business in Libertyville, IL or the surrounding area during the pandemic is not exactly easy. These are perilous times for mom and pop businesses. Even some regional companies are struggling to keep their doors open during the pandemic. However, if you have a plan, you will be able to confidently move forward through this difficult chapter in human history and return your operations to at least a semblance of normal once the pandemic ends.
Embrace the Quest to Maintain Financial Stability
Plenty of small businesses will operate at a loss during the pandemic with an eye on a brighter, profitable future. Establish a plan to maintain financial stability and keep your business afloat during the pandemic. Keep a level head, continue to push forward and you will be able to navigate the uncertainty knowing that these dark days will soon be in your rearview mirror.
The choices you make during this period of time will ultimately shape your company’s future. Above all, don’t forget that true leaders maintain their confidence and motivation when times get tough. This is your opportunity to fulfill your true potential, be your best, and lead your team. Draw inspiration from the insight set forth below and you will be empowered to make prudent financial decisions that help your enterprise hold steady.
The Status of the United States Economy
Take a moment to consider the many different factors that affect economic activity in the United States as a whole as well as your region and locale. The government’s reaction on the federal, state and local levels can have a very real impact on small businesses. If governmental leaders implement prudent fiscal and monetary policies, the economy will be stimulated and small businesses will thrive. Furthermore, the shift to remote work is impacting businesses both small and large alike.
It is quite possible the transition to remote work will prove permanent as opposed to temporary. Remote work is proving mutually beneficial to both businesses and employees as it hikes productivity while liberating employees to work from the comfort of home, spend less on gas, eliminate their commute and enjoy a quiet workspace.
If you are hesitant to fully embrace the transition to remote work, consider the fact that permitting employees to work from home reduces your overhead, possibly by a considerable margin. Employees who work from home use their own computers, phones, lighting, and other utilities. In other words, your company’s overhead has the potential to significantly decrease if employees work from home rather than in a centralized office.
A Business Succession Plan
If you own your own business, there is a good chance you are a member of the baby boomer or Generation X age cohort. The baby boomers are at or near retirement age. If you are in your 50s, 60s, or 70s, this is a good time to start thinking about selling your business or passing it down to the next generation. If you’re not financially ready to sell your business, the pandemic presents an excellent excuse to begin considering a succession plan. Often, it can take several years to find and groom an appropriate successor, and then fully complete an ownership change. So, if COVID-19 has made you tired, it’s wise to start planning for an eventual transition out of your business – it could take awhile.
Retirement Coach or a Financial Planner?
You can’t do it all on your own. However, you might not know whether it is best to work with a financial planner, a retirement coach, or another professional. It might even make sense to work with a full team of advisors comprised of retirement coaches, business coaches, and other professionals. The moral of this story is, as a small business owner, you should not be afraid to ask for help in planning your retirement and ultimately enjoying your well-earned golden years.
Be Cognizant of the Dangers of Emotional Investing
It is no secret that retail investors often make emotion-driven decisions. Be objective as opposed to subjective in the context of investing. Recognize the impact of the coronavirus pandemic and current economic trough are merely temporary as opposed to permanent. The only question is how long the uncertainty will last when things will eventually begin to return to normal.
Determine the Value of Your Retirement Savings
If your investments have taken a tumble, resist the temptation to sell at a loss. The bottom line is it is a mistake to assume you can time the market. If you have cash on hand or savings in money market funds, meet with your financial advisor to go over the many different options for market re-entry.
Just be sure to keep some of your cash liquid in the form of an emergency cash reserve “just in case” and you need to draw upon your savings. Above all, look beyond the short-term drama, maintain a focus on your objectives across posterity, and hold true to your retirement plan.
Consider Your Timeline for Retirement
Your unique retirement time horizon dictates the manner in which you should position your assets. A financial advisor will help you establish the best possible combination of stocks, mutual funds, ETFs, bonds, money market accounts, and other asset classes to set you up for financial success well into your golden years.
Hold Steady Amidst Market Volatility
The stock market is bound to undulate during the pandemic and in its aftermath. In short, it is best to ignore these undulations, keeping your eye on the prize which is a comfortable retirement in the years or decades ahead. Recognize the fact that market volatility is inherent to capitalism, resist the temptation to make investment decisions based on current events and your patience and discipline will pay off down the line.
In particular, it is important to ignore the media hype pertaining to the stock market and economy. If you watch too much CNBC or listen to too much investment-related radio, your decisions will be impacted by the 24/7 analysis, possibly steering you down the wrong path.
Do not make any important decisions pertaining to your finances until you discuss those potential actions with your financial advisor. This professional will help you develop a financial plan that serves as a roadmap to the promised land.
Focus on Your Prosperous Future
The current economic uncertainty and pandemic will eventually come to an end. Keep the faith, lean on your financial advisor during this dramatic chapter in human history, and hold true to your long-term vision. Anticipate a temporary hit to your finances, keep on pushing and you will prevail in the end.
At Prism Planning Partners, we are CERTIFIED FINANCIAL PLANNER™ Professionals committed to facilitating important questions so that we can help you explore all of your opportunities. We offer a broad array of financial planning and consulting services for our clients-including estate planning.
Contact us today and let us illuminate your possibilities!