Managing Your Investments When You Own a Business

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by Advice Chaser
by Advice Chaser

There are over 30 million small businesses in the U.S. Many of the owners think of their business as an investment—a way to grow their money and fund their retirement. But just having a business isn’t an investment strategy. To grow your personal wealth, you need to invest both in the business and outside it.

Think about it: some businesses fail, while others don’t increase in value at the rate you expected. The safest course is to diversify investments both within and without the company. A smart investment strategy will include a variety of choices, so that all your financial eggs aren’t the same basket. A financial advisor can help you build a diverse strategy.

Diversifying Your Investments

As a small business owner, investing in your company is your number one priority. Your long-term goals should be having your business thrive, not just survive. Consider investments that will pay off in business success. You can replace outdated machines, for instance, or hire a new employee.

The rest of your money should be invested outside the company in order to spread out your risk. One place to start is your retirement account. Without an employer to contribute, you’re on your own to build your nest egg. The earlier you start saving, and the larger your contributions, the better.

Stocks are another option. Though diving into the stock market without expertise can be a disaster, a well-managed investment account can grow your wealth. A broker or financial planner can help you choose a stock strategy that will pay off.

Some small business owners also invest in real estate. Is it possible to buy the building where your company operates instead of renting? If you do, you’ll be investing money every month instead of paying rent. You could even buy a building larger than you need and rent office space.

The Benefits of Working with a Professional Advisor

Why should you hire an advisor for investment management? There are a variety of reasons. Even if you’ve been running your business for a while, an outside perspective can help you identify areas where your business can excel. Here are three benefits of working with a professional.

Getting an Objective Opinion

It’s easy to get fixated on a specific investment or industry. An investment advisor can help you look at the big picture and evaluate all the pros and cons.

Should you buy that software? Is that conference a good investment or an excuse for a vacation? Is that stock a good buy, or are you just comfortable with your own industry?

Answering these questions objectively will help you make wiser decisions. A financial advisor can help you be more strategic about your investments so you can boost your long-term wealth.

Managing Your Tax Liability

Owning a business gives you a lot of tax benefits, but only if you know how to take advantage of them. When you structure your business financials and investments correctly, you protect your assets.

Making a lot of money with a business is great, but not if you have to give a large portion to the IRS. An advisor can help you protect your income and savings. Together, you and your advisor can create a tax-efficient strategy that will also save you tax troubles down the road.

Planning Your Personal Future

Sometimes business owners get so busy growing their company that they forget about their personal future. Are you ready for retirement?

If you don’t have investments set aside for your future, you could find yourself in trouble as you get older. A financial advisor can help you with investment strategies that keep you secure today and when you retire.

Are You Ready to Make Great Investment Decisions?

Making the right decisions with your money can be challenging. As a business owner, you’re juggling both your business’s finances and your own. But it is possible to keep both healthy and secure, allowing the business a profitable future and yourself a well-earned retirement.

A professional financial advisor can help you see clearly and boost your confidence. If you’re ready to get started with an excellent investment management strategy, let us help. Contact us to connect with an advisor today.

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