by Thandekile Moloko

Many of us have well wishes for the new decade that many have crowned 20-plenty. With the pandemic ushering us into a year that doesn’t really seem like plenty, there are a few things that we need to bear in mind. Sure, these are trying times, we are all worried about our families, mental wellbeing, job security, and the ever so important financial security. This period of our lives has somewhat placed a spanner in the works of what is meant to be a great year.

What we need to bear in mind is that every season, whether troublesome or not, comes to an end. What we need to factor in, is how we can come out the other side better people than before. Financial security to most, is the ability to weather any storm that we may face without dire financial consequences. The only way to achieve this level of financial soundness is through planning for the future and planning for unforeseen circumstance. Whilst many of us were not well prepared the current pandemic, I hope that some of the key factors below will help you to plan ahead so that you can conquer any other obstacles that may come your way:

Diversification

The highest epitome of purpose is doing what you love and still yielding an income or revenue from continuously doing “what makes you come alive”. Whilst it would be desirable for all of us to do what we love and be financially sound in the process, sometimes it’s not that easy. Diversifying your efforts, and this case your business, will allow you to generate money in various economic cycles, life events and phases of your life. This is an important factor of creating financial soundness. Diversification provides you with a fall back plan when your core business may not be flourishing financially.

Passive Income Or Retainers

Most of our businesses have a hand to mouth strategy. This basically means that we generate revenue now and most of our money is used up in operational costs and expenses that the business needs to stay alive. We can all vouch that such a model creates extreme volatility and anxiety for most of us business owners. The importance of passive or retainer income allows for a constant revenue stream. This creates flexibility to plan ahead and the ability to cover operational costs in the midst of chaos.

Working Towards A Going Concern

Small to medium businesses derive targets mostly by making sure that operational costs are taken care of and that at least breakeven is realised. By adding an emergency fund in the operational costs target, this will benefit the business by creating a going concern. Making it possible for the business to keep afloat in times where yielding revenue is far and in-between. By saving a portion of your revenue for rainy days, you are basically vouching for the success of your business in trying times. Who knows, if the business does not experience “tough times” these funds can be used for the expansion of your business.

Risk Management Planning

If we only knew what will happen, tomorrow, one year from now or even ten years from now, that would make life much better. Unfortunately, most of us are not born with a prophecy ability. Thus, it is imperative that we plan for unforeseen circumstances such as revenue loss due to natural reasons, business losing a key person, geographical disasters. Whatever it may be, insuring the business from such instances assists the business to weather the storm of such temporary events.

Build A Great Support Structure Around You

You are the entrepreneur, the creative, the person that brings a vision to life. Whilst we want to have a handle on every single element and function of the business, this may not be to our benefit. Having external experts help you in certain areas that may not be your area of expertise will save you time, money and mistakes. The key experts that you should have as a support structure are lawyers, accountants, and financial planners. These experts, especially if you have created a good relationship with them, will come in handy.

These are some of the factors that will be beneficial to the sustenance and growth of your business. I hope you find these factors beneficial to you and your business. I also hope that you take the time to reflect on your business, where the business is, where you want the business to be and the process you can put in place to get there.

Thandekile Moloko is a Wealth Coach and Wealth Manager by profession. She went to the University of Johannesburg. She studied Bcom Finance and Honours in Financial planning. Her love for people and changing people’s lives lead her into the financial planning. Thandekile was requested to be part of the ASISA (Association for Savings and Investment South Africa) program to enhance financial planning as an industry. She encompasses tenacity for finance, especially wealth management and personal financial management. With insurmountable experience gained in the industry, she has blazed the market with her expertise within the financial planning industry. With the intent of reaching a larger audience, she decided to increase the scope of her work into Wealth Coaching. In her Wealth Coaching career, she has changed many people’s lives and she changed the landscape of wealth management to be inclusive of those that need it the most. She is an avid believer in changing lives one financial situation at a time. WEBSITE / LINKEDIN / TWITTER