As we usher in a new year, business owners find themselves at a crucial juncture to evaluate their financial habits and make strategic shifts to ensure sustained success. Old habits are hard to break and unlearning certain methods or processes can be difficult.
You may have gotten used to doing things a certain way, had limited capacity to try anything new or were hesitant to wrap your head around a new process. But as your business grows so should your approach to handling your finances.
Let’s explore some financial habits that business owners should leave behind in 2023 and suggest alternative practices that can contribute to long-term financial health.
Old Habit: Ignoring Technological Advancements
Ignoring technological advancements can hinder a businesses growth. Whether its adopting cloud-based accounting systems, embracing automation tools or using applications to extract data for decision making, staying technologically current is vital. Outdated systems or using a bunch software that isn’t harmonious can result in missing opportunities for cost savings and revenue generation.
New Habit: Prioritise integrating technology into your financial processes. Look into cloud-based accounting software and automation tools that will streamline your business.
Old Habit: Neglecting Cyber Security
With an increasing frequency of cyber threats and advanced scams, ignoring cyber security is a risky financial habit. A data breach or attack can have severe financial implications. In the new year, it’s essential for businesses to take their online security seriously and safeguard their sensitive financial information.
New Habit: Invest in cyber security practices and employ and outsource the wisdom of someone that knows their way around IT. Proactive measures can reduce the risk of your data being comprimised and protect you and your business.
Old Habit: Short-Term Financial Planning
Only having a short-sighted plan can find you unprepared for unexpected challenges. And making decisions that provide you with immediate gain without considering the broader financial landscape can lead to decisions that don’t align with your long-term goals or set you back in the growth you imagined.
New Habit: Get into the routine of strategic long-term planning. Forecasting and setting clear financial goals and the steps to achieve them will ensure you are one step ahead. Also regularly reassessing your financial strategy can help you move the goal posts in light of ever changing market conditions. Book in a tax planning meeting with your accountant – they will get you on the right path!
Old Habit: Running everything solo
Business owners are used to wearing many hats and in the beginning it’s a cost-effective way to do everything on your own. However, some owners may fall into the habit of solely relying on their intuition or experience. Managing your own numbers/bookkeeping/payroll can end up being a source of anxiety and stress, especially if this isn’t your strength and as a result, bad financial decisions can be made this way.
New Habit: Find an accountant that can be your business bestie! Actively seeking the guidance of financial experts means they can bring their specialised knowledge to help you grow and manage your business and most importantly, save you money. Being financially literate can help empower you to make tough decisions.
Stepping into 2024, employing these new habits and leaving behind outdated practices can position you for financial success in the new year and beyond.