One in five businesses fail within the first year, and 82% of small businesses fail because of cash flow issues. If you own a small business, your financial future is tied to every decision you make, good or bad. If you’re managing your business, delivering services, and everything in between, who’s looking at your finances?
A small business financial advisor helps you manage cash flow, optimize taxes, protect your assets, and even prepare for an eventual sale or succession. If you haven’t considered hiring a business financial advisor, this guide will help you understand what they do, when you need one, and how they can support your business through every stage.
What is a Small Business Financial Advisor?
A small business financial advisor helps you make smart money decisions so your business can grow, stay protected, and stay profitable. They don’t just help with investments. They also help you run a financially sound business from top to bottom.
Depending on their background, some financial advisors specialize in tax planning, others in long-term financial strategy. The best advisors for small businesses offer a mix of both and a strong understanding of how small businesses operate day-to-day.
Here are some services financial advisors for small businesses can offer:
- Cash flow management
- Tax planning
- Retirement planning
- Risk management
- Business valuation
- Exit & succession planning
- Investment guidance
Benefits of Small Business Financial Advisors
Create a financial plan.
According to a study by Clutch, only 54% of small businesses had a formal business plan. Even fewer had a full financial plan that included budgeting, forecasting, and long-term goal setting. That means nearly half of small business owners (SBOs) are operating without a strategic financial plan, relying instead on gut instinct, spreadsheets, or whatever their accountant sends over at tax time.
A financial advisor for SBOs helps you create a clear plan for your money. They’ll help you budget smarter, prepare for slow months, and plan for big moves like hiring or expansion.
Lower your tax bill.
No small business owner wants to pay more in taxes than they have to, and yet, many do. Why? Because they don’t have a year-round strategy in place. That’s where a financial advisor comes in. Small business owners who work with tax advisors can save anywhere from 10% to 30% on their total tax liability each year, sometimes even more, depending on the business structure and income level.
Protect your assets.
A financial advisor for business owners helps you protect what you’ve worked so hard to build. They make sure your business is set up the right way (like forming an LLC or S-Corp) so your personal savings and property aren’t on the line.
They also help you choose the right insurance without overpaying for things you don’t need. They’ll also guide you in building an emergency fund so you’re not scrambling when unexpected costs hit. It’s about being prepared, staying protected, and making sure one issue doesn’t turn into a financial disaster.
Manage your investments and retirement plans.
If you’re sitting on extra cash, they’ll help you put it to work through investments that align with your goals. They’ll also help you set up the right retirement plan, like a SEP IRA or Solo 401(k), so you can lower your taxable income while building long-term wealth.
If you have employees, they can guide you in offering retirement benefits that are attractive and affordable. They help you grow your money, protect your future, and make sure your financial life is working as hard as you are.
Value your business.
Most small business owners have no idea what their business is worth, and that’s a problem if you ever want to sell, bring on investors, or plan for retirement. A business valuation advisor can help you get a clear, accurate valuation based on your revenue, assets, liabilities, and market conditions.
They’ll also show you what’s driving your value and where you can improve it, whether that’s increasing profitability, reducing debt, or tightening operations. Knowing your value isn’t just about selling; it’s about making smarter decisions today that boost your business’s long-term potential.
Create a succession plan.
Goldman Sachs found that only about 15% of small business owners have a formal, documented succession plan. Most are either handling it themselves or leaning on legal counsel without a full financial strategy.
A financial advisor helps turn your succession plan into more than just a legal formality; they make sure it actually works. While many business owners rely only on a lawyer, an advisor looks at the full financial picture: valuing your business, reducing taxes, preparing your retirement income, and making sure your exit doesn’t hurt the company’s future.
Need a Business Financial Advisor?
Griffiths, Dreher & Evans, PS, CPAs specializes in ‘Main Street’ businesses, supporting small businesses through business valuations, business sales, tax preparation services, and investment advisory services. All our shareholders are Certified Public Accountants (CPAs) with the Personal Financial Specialist (PFS) credential, a designation issued by the American Institute of Certified Public Accountants (AICPA).
We’ve been named one of the Top 150 CPA firms U.S. by Accounting Today* for the past five years. All business valuations conducted by our CPAs are Certified in Business Valuation by the NAVA or AICPA. Our Valuations also meet SBA, IRS, and USPAP requirements whenever needed.
With us, you get expert guidance and personalized financial solutions for your business. Call us to schedule a NO-COST, NO-OBLIGATION discovery call today.
Frequently Asked Questions
What is an investment advisor representative?
An investment advisor representative (IAR) is a licensed professional who provides investment advice and financial planning services on behalf of a registered investment advisor (RIA). They help clients manage assets, develop financial strategies, and are legally required to act in their clients’ best interest.
How to choose investment advisors for my business?
Look for advisors with experience working with small businesses, a fiduciary duty to act in your best interest, transparent fee structures, and a clear understanding of your industry. Ask about their credentials, how they build strategies, and whether they offer both personal and business financial guidance.
What questions to ask an investment advisors before working with them?
Ask how they get paid, if they’re a fiduciary, and what experience they have with small businesses. Find out how they’ll tailor advice to your goals, how often you’ll meet, and what services are included in their fee.
What’s the difference between broker dealer vs investment advisor?
A broker-dealer earns commissions by selling financial products, while an investment advisor provides ongoing advice for a fee and is legally required to act in your best interest. If you want unbiased, long-term guidance, an investment advisor is usually the better choice.
*Tax savings vary by business structure and individual circumstances; this example is illustrative and not a guarantee.
*Annual ranking of CPA firms by assets under management by AccountingToday.com in 2020, 2021, 2022, 2023, 2024. Data is provided by AuditAnalytics.com This ranking is not an indication or guarantee of the future performance of GDE; and a client’s actual experience with GDE may not be the same as the Accountingtoday.com ranking of GDE.