Now that we’re in 2025, and the kids have gone back to school, February offers the perfect opportunity to set financial goals for your business. With the fresh start of a new year, now is the time to reflect on your finances, establish clear objectives, and create your own roadmap to success. Setting well-defined financial goals isn’t just about making resolutions – it’s about giving your business direction and ensuring long-term sustainability.
Reflect on Last Year
Before setting new goals, take a moment to review your business figures from last year. Analyse your financial statements to understand what worked and what didn’t. Identify areas for improvement and consider any unexpected challenges you faced. This reflection will provide valuable insights for setting realistic goals. Some questions you might like to ask yourself include:
- How did my income fluctuate month to month?
- Were there any unexpected expenses that impacted your cash flow?
- If you had profit targets, did you meet them, or do adjustments need to be made?
- Which product/service made up the majority of your income?
- Which product/service made up none or hardly any of your total income?
- Do you have new products/services coming up in 2025 that may mean you need to ‘retire’ some from 2024?
By assessing these kinds of trends, you can make informed decisions for the year ahead and identify areas you’d like to see improvement.
Define Clear Objectives
Once you have a clear understanding of last year’s finances, it’s time to set goals that are SMART:
- Specific: Clearly define what you want to achieve (e.g., increase monthly revenue by 10%).
- Measurable: Track progress with numbers and benchmarks.
- Achievable: Set realistic goals based on your business’s capacity.
- Relevant: Align goals with your business’s overall vision.
- Time-bound: Set deadlines to maintain accountability.
Examples of SMART financial goals include:
- Reducing unnecessary expenses (be specific!) by 15% by mid-year.
- Saving a set amount each month for tax obligations.
- Expanding your client base by 20% by Q3.
Break Goals into Actionable Steps
Big goals can feel overwhelming, but breaking them down makes them manageable.
- Monthly Check-ins: Dedicate time at the start of each month to review your progress.
- Quarterly Reviews: Assess what’s working and adjust where necessary.
- Daily & Weekly Habits: Implement small, consistent actions, like updating your bookkeeping weekly or monthly to stay on top of financial records.
Monitor and Adjust
No plan is set in stone, and business finances can be unpredictable. That’s why flexibility is key. If a goal becomes unrealistic due to changing circumstances, reassess and adjust rather than abandon it completely. Utilise bookkeeping software, financial forecasting software or even a simple spreadsheet to monitor income and expenses regularly, thus helping you prevent cash shortages and avoid debt.
Considering utilising a cash flow statement to help you forecast cashflow in your business. These help you track the money flowing in and out of your business. You can use a cash flow statement to:
- find payment cycles and seasonal trends
- forecast your future business finances
- help predict shortages and surpluses
- plan ahead to make sure you always have money to cover payments.
You can download my free Cash Flow Statement Template HERE.
Seek Professional Advice
Consider consulting with a financial advisor or accountant. They can provide expert guidance and help you optimise your financial strategies.
Conclusion
This week, commit to setting at least one financial goal for your business. Whether it’s improving cash flow, increasing revenue, or saving for a major expense, taking that first step will set you up for success in 2025.
By setting clear financial goals at the start of the year, you can steer your business toward success. Stay committed, track your progress, and be ready to adapt as needed. Here’s to a prosperous year ahead!
Need support to stay accountable and on track? Join my monthly virtual co-working sessions – Boss of Your Books – an affordable way to work on your bookkeeping with guidance and community support. Let’s make 2025 your best financial year yet! Join here.
