Most clients I meet with are NOT financially well organised and this is not surprising, because there is no requirement to getting financially well organised. Unlike high school, where if you had poor grades in say year 8, teachers would recommend you repeat that year, it appears that once you are out there in the big bad world with your own business, it’s ok to not have your ducks aligned as most business owners don’t have a metaphorical teacher to make recommendations.

There are 9 key areas to cover if we are to diagnose how financially well organised you are. These are the sorts of questions I ask my clients to help them stay in top shape. To achieve your life goals you must get organised but remember the shovel won’t dig it’s own hole. This article will give you the framework but YOU need to take action and make it happen.

I follow this same framework regardless of whether I’m speaking to a small business owner or anywhere up to a medium sized business owner in the tens of millions of revenue. We first need to identify where are we now and shore up on the numbers then dream where we would like to be. To get from where we are now to our future destination we need to be financially well organised which involves asking the below questions:

1. Business Performance and Valuation

  • is your business meeting its revenue, profit and cashflow goals?
  • has your business value been increasing year on year?
  • are you drawing a wage and dividend that exceeds your expectations?
  • is the time you spend working in and on the business, a number you are happy with?

2. Tax Minimisation

  • are you sufficiently well prepared to minimise your likely future tax position well in advance of the financial year end?
  • how confident are you that you would come through a tax enquiry without any problems being identified?

3. Asset Protection

  • is your current legal entity (i.e. sole owner, partnership, company, trust) the most advantageous for your business?
  •  has your business entity been established in such a way to maximise your asset protection?

4. Estate Planning

  • do you have a current will in place that was prepared by a lawyer?
  • are your powers of attorney in effect in the event of an unplanned event taking place?
  • do you have legally enforceable binding death benefit nominations?
  • have you thoroughly considered how you estate will be shared with your beneficiaries and taken into account matters such as estate equalisation to reduce any challenges to your will?

5 .Retirement Planing and Superannuation

  • have you determined the income levels you will require in retirement?
  • do you have a plan in place to build sufficient retirement assets by the time you wish to retire?
  • how confident are you that you will reach your retirement goals?

6. Business Succession/Exit

  • do you have a documented succession or exit plan in place?
  • are you aware that it can take many years for a business to become investor ready and maximise your exit price?

7. Personal Finances and Investments

  • are your personal wealth creation activities generating the returns you wish?
  • is your property portfolio bringing the capital growth you need to hit your goals?

8. Personal Insurances

  • are you confident that your family will more than adequately be catered for in the unplanned event that something happen to you?

9. Personal Debts

  • do you have any excessive non-deductible debts that are draining your personal cashflow?
  • how confident are you that you are paying the lowest levels of interest on your debts?
  • when was the last time you had your debts reviewed and consolidated?

If you are unsure or don’t understand any of the above queries you should discuss them with your accountant or advisor. Some are more relevant for certain stages of your life but all play a part in your financial journey and should be road-mapped and discussed on a regular basis.