Personal Planning vs. Planning Needs For Your Business: Where Should Business Owners Start?

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As a business owner, it’s far too easy to become narrowly focused on your business and your business alone.  As a business owner, you often eat, work, and sleep about all things business, and don’t spend a lot of time with your personal planning needs and wants. 

When it comes to the ultimate goal of retirement on your terms, and growing your overall balance sheet, having a successful business probably isn’t enough. 

Here at Consolidated Planning, our first hand experience with business planning and personal planning has allowed us to help business owners like yourself cultivate the symbiotic relationship that should be your business and personal planning needs. 

In this article, we’ll help you understand the aspects essential to adequately address your personal planning needs, the ways in which your personal and business planning are linked and tools available to help you better plan, all to help you better protect and optimize your business. 


Addressing Your Personal Planning First As A Business Owner 

As a business owner you’re just like anybody else…except you happen to own a business. You probably have more responsibilities than most rank and file Americans, since you have your family AND your employees to worry about.  Your business ownership also gives you access to an asset that is unique amongst all other assets. It’s a tool that you can use to: 

  • Generate income 
  • Save money creatively to fund your personal goals and objectives, and 
  • Find additional tax savings 

Business owners like you, more than almost any other section of society, control your own destiny. You generate the dollar which ultimately feeds the bottom lines of your family and those families who work for you. You are truly living the American Dream. 

It is essential that the personal side of your life and your finances are in check. 

Pinpointing your personal planning goals enables you to identify financial markers which are useful in annual business planning. There are two main facets to focus on when it comes to your personal planning needs: 

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#1 Protect Your Income 

Protect first and protect in full. If you’re putting all of your eggs into one basket, your business, then your business is very susceptible to both factors inside and outside of your control. 

You should be asking yourself, “how can I best protect the value of owning my business for myself, my family, and my key employees?” Protecting that value starts with the income your business generates. 

If something were to dramatically alter the course of your business, what would happen to your income?  What would happen to the value of the business you own(ed)? 

In some cases, such as in the event of an owner’s death, your business might see a significant and immediate reduction in value.  Legislative and market risk can have a dramatic impact on business valuation, particularly in certain industries. This matters as you get ready to address your retirement goals and post-sale income requirements


#2 Allocate Your Savings From The Business And From Your Personal Earnings 

This may sound unusual at first, but as an owner you have two sources of income generally.  You have your W2 income and your salary, just like most working Americans do. And like most Americans, you have the ability to save from those salaried earnings.  Habitual savings from your salaried income is important – in both the amount and where that savings is stored. 


Personal Savings Is A Must 

We think that business owners should be able to save 15% of their salaried income year, at least. And this savings shouldn’t be stored just anywhere.

Most employees have a 401k that is matched (by you) and they should maximize those savings.  For a business owner, that may not be the best place to store wealth. For starters, contributing to your 401k is simply ‘matching’ yourself.  Additionally, running a successful business is how you ‘win the game.’ Rank-and-file employees must use tools like 401ks to beat inflation – they simply don’t have other choices. Business owner’s have their business as an asset to beat inflation.   

That said, every business owner knows that dangers and opportunities exist around the corner.  And the best way to fend off dangers and take advantage of opportunities is to stay relatively liquid. This doesn’t mean keeping your hard earned savings in a checking account, but 401ks are relatively illiquid as a business owner until retirement.   

So saving at least 15% from salaried earnings is important and it’s also smart to have a store of wealth that is liquid enough to assist in times of need yet still beats inflation. 


Saving Straight From The Business 

The best savers we see are ones that not only save from their salaried income, but they also save straight from the business.

This may be straightforward, but we find when business savings can by-pass your personal household banking accounts, and pass straight to an investment account, savings is easier

We think that a business ought to be able to save at least 15% annually for the benefit of the owner, and this is in addition to the 15% of personal savings. 30% savings in all.  

In addition to being easier, business savings for personal use may have other benefits around taxes.   

Finding a good financial advisor to coach to maximize your savings – both personally and from the business – will educate you on your options.  Should your personal savings go to a 401k or not?  What is the impact of one business savings strategy over another?  What can you do to make your savings plan ‘auto-pilot’? 

Since your business is always top of mind, try running your household like your business. When it comes to your bottom line, that is.  


Personal Planning And Business Planning Are Intimately Linked 

Now, imagine trying to make decisions in your business without any concern for your personal life – your family, your home, your aspirations. That just doesn’t make sense, does it? 

But, oftentimes, that’s what most business owners are doing, whether they realize it or not. 

Trying to address your business planning without taking inventory of your personal planning doesn’t tell the whole story. And at Consolidated Planning, we believe in a consultative approach that includes protection, assets, liabilities, business value, and cash flow. For both your personal balance sheet and your business balance sheet. 

That’s because your business feeds your personal life and your personal life feeds your business. 


The Living Balance Sheet® Helps You Better Plan For Your Business And Personal Life 

The Living Balance Sheet® (LBS) is a tool exclusively available for those working with a Guardian advisor. When it comes to LBS and business owners, this tool addresses three distinct areas for concern: Asset Protection, Wealth Building and Exit Strategies.  

Being able to define your vision, goals and risks, when it comes to your business has a substantial impact on how you approach your finances going forward, which ultimately helps you reach your financial goals. Personally and professionally. 

LBS provides an organized and integrated view of your entire financial picture across your business and personal life. This perspective provides an advantage and opportunity for you to GROW and protect the wealth you’re building


Protect Your Personal Finances To Optimize Your Business Planning 

The beginning of the year is often the best time to start identifying and implementing your goals for the year ahead. And, frankly, it’s quite necessary (and productive) to know where you are going. Think in terms of starting with your ideal ending in mind. 

By protecting your personal finances you can do three things: 

  • Free up cash flow on the personal level 
  • Experience less pressure to earn more in your business, and 
  • Better understand what will your cash flow look like 

And cash flow is paramount in your personal and business life. 

These factors will be especially important as you start to consider your buy-sell strategy for exiting your business. No matter how far off that may seem. With alignment between your personal and business planning, you can create more opportunities to build value for your business

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2024-168297 Exp. 1/2026


Guardian, its subsidiaries, agents and employees do not provide tax, legal, or accounting advice. Consult your tax, legal, or accounting professional regarding your individual situation. The information provided is based on our general understanding of the subject matter discussed and is for informational purposes only.  

This material contains the current opinions of Mike Dare and Consolidated Planning only. These are not the opinions of Park Avenue Securities, Guardian, or its subsidiaries.

Published:  February 7, 2024