Why Financial Planning Is Important For Women Entrepreneurs
I’ve grown up with my parents always echoing the words – Save Money, Don’t Waste It! And as a child, I would always wonder if we have enough to pay for everything we need then why should we even worry about putting an amount aside each month? Now I’m all grown up and run my own venture and this good old habit of savings has been of utmost importance in my entrepreneurial journey.
Here are some reasons why saving is a great practice:
If you regularly save and invest, it helps you in the long run, no matter who you are – a student, an entrepreneur, a homemaker or a salaried professional. But there’s more to it for the entrepreneur.
- Getting to know your money – the debits and the credits, understanding cash flows, having a better understanding of yields and returns on investment, understanding the implication of tax planning and optimisation of returns, will all reflect upon your business decisions, too.
- As you get accustomed to knowing these concepts, your business language changes, and you will be more focused into looking at returns on investment – the mainstay of any successful venture.
A Pragmatic Indication
Your saving and investment habits make a positive impact on stakeholders and investors. They realise that you, as an entrepreneur, are frugal and want to make every penny go a long way. While studying your venture, they not only judge based upon the rate of return that the business would generate but will also closely look at your processes and your mindset. Savings and investments are indications of good intent and better financial security.
Savings and investments are indications of good intent and better financial security.
Peace of mind
You’ll get busier with your entrepreneurial journey but alongside you would have created a pool for yourself, in spite of starting small. In a few years, you will have cash at hand and won’t need to go hunting for it. Also, once you make saving a habit, you will not overspend money when you get loans or get funded. This mindset helps a start-up in optimising resources.
Saving For A Rainy Day
Savings and investments mean you have something to fall back on when you are down and need it the most. This holds true for everyone. For an entrepreneur, it is even more important because she understands equity is more expensive and comes with a rider to take away profits. With smart saving and investment decisions, you can buy out those equities and expand quickly. You are also free to start another line of business.
A positive take on savings sets the tone for a savings culture in the organisation.
Setting The Right Tone
A positive take on savings sets the tone for a savings culture in the organisation. When you talk about investments with your team, and advise them about it, it has a positive effect on others as well. Not just does it help them plan better for the future, this mindset also passes on to their business decisions within the venture as well.
An active role in managing finances, savings and looking at ways to maximize income will ensure a brighter financial future and success story for your company.