August Benefits News and Posts

5 Ways Small Business Owners Can Start Preparing for Retirement

FROM BUSINESS NEWS DAILY / BY KATHARINE PALJUG

Retirement doesn't have to be scary. These five tips can help any small business owner prepare for their retirement.

Small business owners have to save for their own retirement without company benefits or 401(k) matching programs.
There are many ways small business owners can and should actively prepare for their retirement.
These five actionable tips can get you started on your road to a financially sound retirement after a career as an entrepreneur.
This article is for small business owners who want to plan and save for their retirement but aren’t sure how to start.

Most large companies offer employee retirement benefits plans, such as a matched 401(k) plan, so their workers can save for retirement. But when you work for yourself, you have to take responsibility for your own retirement plan.

A Manta survey of nearly 2,000 small business owners revealed that one-third of entrepreneurs don’t have a retirement plan. As a result, many older small business owners are anxious about retirement.

“That’s a lot of entrepreneurs whose futures are filled with a great deal of uncertainty right now,” said John Swanciger, CEO of Manta, in a statement.

It’s easy for small business owners to get distracted by the day-to-day financial decisions involved in running a company, but it is important to keep retirement savings strategies in mind, according to Alissa Todd, financial advisor at The Wealth Consulting Group. “While it is important to focus on your business’s success and growth strategy, it is equally important to create a strategy for your own personal financial success.”

1. Set concrete goals.

When you plan for retirement, start by deciding where you want to end up – living a modest life in an apartment, traveling around the world in your own yacht, or somewhere in between. Knowing the result you want to achieve allows you to start planning.

“Financial goals, like any goals, work best when they are specific, measurable and time-sensitive,” Todd said. “Set … intentional and realistic retirement and financial goals so that you can work towards the retirement lifestyle that you envision.”

“Whether a business owner chooses to sell the business, hand it down to family or a colleague, close the business (which often requires selling assets like equipment), or sell out a partnership, this decision will ultimately inform how to prepare for retirement,” said Jay DesMarteau, head of commercial specialty segments at TD Bank.

For instance, he added, many small businesses are sole proprietorships. If the owner’s goal is to grow their business, they’ll need to increase the value of their business, add at least three or four employees, and increase revenue.

How to get started

Think about your long-term career goals and write them down. Consider everything you hope to accomplish (particularly any goals that have financial ramifications). Do you want to pay off your house by a particular date? Set aside a certain amount of money for kids’ college funds? Purchase a boat or a vacation house? Take a certain number of trips each year?

Whatever your goals are, write them down, and be as specific as possible with regard to amounts, dates and funds needed to accomplish them. You can worry about sorting and prioritizing them later – the important thing to do first is to write them down where you can see them.

2. Develop a succession plan.

According to the Manta survey, 34% of small business owners don’t have a succession plan in place. But preparing for how to leave your company, and knowing who will take over after you leave, is part of planning for both your future and that of your business.

“In the corporate world, there’s almost always another employee waiting in the wings to take the place of a co-worker who has retired,” Swanciger said. “That’s not usually the case for small business owners, who typically have a difficult time relinquishing control to just anyone.”

Another succession option is implementing an employee stock ownership plan (ESOP), which allows employees to become beneficial owners and provides tax advantages for the selling owner. Whichever option you choose, put everything in writing to prevent any legal problems or confusion for your employees.

“While these processes – and eventually handing over the reins to your business – may seem daunting, taking the time to plan ahead will alleviate many of your future headaches,” Swanciger said.

How to get started

First, speak with a lawyer to determine the legal requirements for creating a succession plan. Make a list of people or groups who may want to take over your business. It could be an employee, a group of employees, a partner, a vendor or a family member. Consider whether any of those people or groups are prepared to take over your business and whether they’re capable of buying it. Consider any work that may need to be done upfront to prepare your successors to take charge, as well as any controls that will need to be put in place.

3. Build your support team.

Creating a retirement plan for you and your employees requires strong knowledge of investments and tax law. Working with the right professionals can help you plan effectively for every step.

“Surround yourself with a team of professionals in all aspects of your life, especially when it comes to your financial life,” Todd said. “That is one of the habits that we consistently see among our most successful clients.”

She recommended including each of the following on your planning team.

Financial advisor: This person assists with investment and retirement planning, employee benefits, succession planning, and business valuation, as well as general financial decisions such as cash flow, debt and risk management.
Certified public accountant (CPA): Hiring a CPA minimizes your tax liability and ensures that your taxes are done properly. A CPA can also help you choose the right retirement plan based on how much you want to contribute in pre- and post-tax dollars.
Business attorney: This person ensures that your business entity and any contracts are structured and executed correctly. They also check that your current business format is the best option and advise you on any changes.

“Ideally, all the professionals in your life should work together to ensure that everything each professional is doing is in … alignment with the goals of both the business and business owner,” Todd said. “Let them do the job that you hired them for so that you can focus your energy on doing the things that make you successful and happy.”

How to get started

Interview reputable professionals who may be good advisors to help you build and execute your plan. Make sure they have expertise in all the areas where you need help, whether that’s securities, corporate law or taxes. Ask about their fees and compensation structure. Once you choose your team, make them aware of your goals and schedule regular meetings with one or more of them to check in and track your progress.

Additionally, compare the best accounting software providers if you’re looking to improve how you manage your business’s finances.

4. Plan how you’ll step out of your business.

If your goal is to fund your retirement from the sale of your business, you need to plan early to ensure that it’s ready for potential buyers.

“All too often, business owners come to me when they’re at the point of being desperate to sell,” said Kevin Vandenboss, broker at Vandenboss Commercial. “They haven’t been preparing for the sale of their business, either because they don’t know how or because they always thought their kids would take over the business.”

To avoid this situation, start approaching potential successors several years before you plan to retire to find out if they are actually interested in taking over the business. If they’re not, you’ll need to obtain a valuation of your business and start planning for a sale three to five years before you want to retire.

“Obtain a valuation from an independent company so that you have a realistic expectation of what you can expect to receive from a buyer, and make sure you know whether you want to step away from the business completely or are willing to stay on for a few years in an earn-out arrangement,” Todd said. “Minimizing taxes is usually a major concern for sellers … so work with a CPA, attorney and financial advisor to ensure that you understand the potential tax implications from your business sale.”

You’ll also need to start decreasing your role in business operations, Vandenboss said. “Small business owners should work toward a goal of being less involved in the day-to-day activities of their business, because businesses that require the owner to work long hours are less attractive to buyers.”

How to get started

List all of the things your successor will need to know how to do once they take over your business, especially all of the things that only you know how to do at the moment. Map out when and how much time you’ll need to spend teaching them those things. Also consider any help they’re likely to need administering the business. If your successor is already an employee at your business, will they need to backfill for their current role?

Consider how much you reasonably expect a buyer will pay for your business. If your successor may need a business loan to finance the purchase, study different types of loans to know which one might work for them. Think about what the buyer will need to qualify for a loan.

Also examine whether you’ll be in a position to finance the purchase yourself by holding a promissory note. While this could be an option that would provide you with some interest income, it’s typically a last resort.

5. Diversify your retirement savings.

Though selling a business is one way to fund retirement, many experts warn about the dangers of relying solely on money from a sale to bankroll your golden years.

Instead, diversify your retirement planning by opening one or more retirement savings accounts as early as possible. These retirement plan options can come in the form of SEP IRAs, SIMPLE IRAs, self-employed 401(k)s or a combination of these plan types.

“Weigh your current cash flow situation with your current tax situation and long-term retirement planning goals,” Todd said. “All of the retirement plans accomplish something a little bit different, so it’s important to make an educated decision when establishing a plan. For example, in 2021 you can contribute up to $6,000 in a traditional or Roth IRA (and an additional $1,000 if you are over the age of 50). However, in a SEP IRA, you can contribute 25% of your earnings up to $58,000, which is significantly higher.”

You may also need to take any employees into account. “Certain plans, such as SEP IRA and SIMPLE IRA, require that you make contributions to your employees’ retirement plans each year that you contribute to your own account,” Todd said. “In contrast, a solo 401(k), commonly referred to as a solo K, can only be set up for business owners and solo entrepreneurs with no employees except for a spouse.”

How to get started

Make sure your retirement and savings accounts are set up and funded. If you sponsor a retirement plan for your employees, be sure you’re contributing to that as well, and invest that money to earn a return. Consider opening separate savings or investing accounts outside of retirement accounts so you can save money without locking it up or needing to pay taxes on withdrawals later. Shop around for annuities or CDs that you can ladder to provide you with regular income once you’ve quit working.

Take retirement one step at a time.

If navigating retirement savings seems overwhelming, work with your financial advisor to create a plan that puts you on track for retirement without compromising your current cash flow or lifestyle.

The best thing any small business owner can do to ensure a comfortable retirement is to start planning early.

“Don’t procrastinate,” Todd said. “Even if you feel as though you don’t have the time to sit down and think about your retirement plan, make it a priority. Your future self will thank you.”

Todd BellistriDecember 16, 2022August Benefits

Why not start off this selling season leading into the holidays on the right foot? One way to do that is to finally give some thinking to smart marketing. We don’t need to be the ones to tell you it’s very competitive out there (but we will), what with tons of start ups and side hustles all over the landscape. By developing a legit marketing program you are giving yourself a true foot up on the competition. So read on, you’ll see that its not as daunting as you think and the upside is well worth it.

FROM FORBES / BY DOMINIQUE HARROCH

In today's digital landscape the right approach to small business marketing combines advanced technology, data-driven insights, and effective digital platforms. Here’s a comprehensive guide to small business marketing to companies navigate the current marketing trends and tools that can drive business success.

Key marketing tools for small businesses

Following is a summary of 11 key marketing tools that small and growing businesses should consider when leveraging owned, earned and paid media:

1. An optimized small business website

A high-performing website is crucial for marketing today. An optimized site increases your page rank on Google and other search engines, and in today's world, fewer than 1% of searches go to the second page of a search. Key elements of an effective small business site include:

Memorable domain name: Choose a name that reflects your business and is easy to recall.
User-friendly design: Ensure your site is visually appealing and intuitive. Sites should have a clear structure, intuitive navigation and information that is easy to access.
Search engine optimization (SEO): Implement SEO best practices to rank higher in search engine results.
Mobile optimization: Since over 55% of global web traffic comes from mobile devices, you’ll want to ensure your site is mobile-friendly.
Valuable content: Regularly update your site with engaging content like blogs and articles that address your audience's interests and needs.
Fast loading times: Optimize page speeds to improve user experience and SEO rankings.
Secure hosting: Use reputable hosting services to protect your site’s data and performance.

Additionally, integrating tools like Google Analytics (now called GA4) and Google Search Console (GSC) can provide valuable insights into your site's performance and user behavior.

2. Paid search engine marketing (SEM)

Paid search engine marketing, in which you pay if a keyword is clicked on that drives traffic to your website, remains a powerful tool for driving targeted traffic. Platforms like Google Ads and Bing Ads allow you to:

Bid on keywords: Use tools like Google keyword planner to select high-value keywords relevant to your business.
Control costs: Set daily and monthly budgets, and adjust bids based on performance.
Analyze performance: Track key metrics to assess and refine your campaigns.

3. Paid listings and display ads

Paid listings on platforms like Yelp, Facebook, and Pinterest can boost visibility. Use Google’s Display Network to target ads based on user interests and behavior. This approach allows you to:

Choose ad formats: Use banners, text ads, or video ads to capture attention.
Track return on investment (ROI): Monitor clicks and conversions to measure effectiveness. Track your costs, record and monitor revenue, and record all expenses. Make sure to measure lead generation numbers, customer acquisition, and sales metrics as valuable insights into your marketing effectiveness.
Testing: By experimenting with different ad copy, targeting options, and formats, businesses can identify what resonates most with their audience, refine their strategies, and ultimately improve click-through rates and conversions. This can include A/B testing, target audience variations, ad copy variations, call-to-action (CTA) testing or visual elements where you test different images or videos to determine which visual elements attract more attention and engagement.

4. Content marketing

Content marketing remains a cornerstone of effective digital strategies. Key tactics include:

Blogging: Regularly post optimized content to drive organic traffic. Nine out of ten marketers use blogs as part of their content strategy.
Guest posting: Publish articles on popular platforms such as Medium and AllBusiness.com to enhance your reach and SEO. Strive to create “evergreen” articles, which are designed to remain relevant and valuable over a long period of time, regardless of current events or trends. Unlike timely articles that focus on current news or trends, evergreen content addresses topics that have enduring interest and utility.
Video content: In 2023, individuals spent an average of 17 hours a week watching videos online. Utilize platforms like YouTube and TikTok to engage your audience.
Content platforms: Leverage content recommendation platforms like Outbrain to expand your content’s reach.

5. Social media marketing

Social media is a powerful tool for engaging with your audience. Focus on platforms such as:

Facebook: Effective for broad audience reach and targeted ads.
Instagram: Ideal for visual content and influencer partnerships.
LinkedIn: Best for B2B marketing and professional networking.
TikTok: Useful for viral video content and younger demographics.

With over 5 billion global social media users and growing, effective social media marketing can significantly enhance your brand’s visibility and engagement. To be effective, you must regularly post interesting content to obtain and keep followers.

6. Influencer marketing

Influencer marketing involves collaborating with individuals who have a significant and engaged following on social media platforms like Facebook, TikTok and Instagram to promote products or services. These influencers, who can range from celebrities to niche content creators, leverage their credibility and relationship with their audience to drive brand awareness and influence purchasing decisions.

The impact of influencer marketing on broader marketing efforts can be profound, as it allows brands to tap into authentic, targeted communities that are often more receptive to recommendations from trusted (or at least known) voices.

This form of marketing can enhance brand credibility, expand reach, and generate higher engagement rates compared to traditional advertising. As consumers increasingly seek personalized and relatable content, influencer marketing has become a powerful tool for connecting with audiences in a meaningful way.

7. Online business directories

It’s important for business owners to list their companies in prominent and reputable business directories. Often these listings are free, but even if you must pay a small fee, it can be worth it.

The benefits include

Exposure to potential clients and customers.
Boosted SEO through backlinks.
Improved online presence and brand awareness.
Increased credibility for your business.
Low-cost or free marketing.

The following is a list of top business directories to consider listing your business:

AllBusiness.com
Better Business Bureau
Facebook Page
Google Business Profile
LinkedIn
Superpages
Bing Places for Business

8. Radio marketing

While less prominent today, radio can still be effective. Many people are in their cars during peak commute hours. To maximize radio advertising:

Targeted placement: Choose stations and time slots that align with your target audience.
Engaging content: Create memorable and concise ads.
Consider your market: Are you a B2C company (business to consumer) or B2B company (business to business)? Is your market local (like a neighborhood restaurant), national (such as selling payroll services), or international (such as selling unique clothing to multiple markets)?

The cost-effectiveness of radio compared to TV makes it a viable option for more localized campaigns.

9. Press releases

Press releases are valuable for announcing significant business updates. Ensure your release is:

Newsworthy: Focus on unique and timely information.
Well-structured: Include a strong headline, key details, and contact information.
Multimedia: Incorporate multimedia elements like images and videos to increase engagement.

10. Email marketing

Email marketing remains effective when executed correctly. Best practices include:

Segmenting: Personalize content based on customer preferences and behavior. Use data to segment your lists and target markets.
Offering engaging content: Provide valuable information, special offers, and updates.
Optimization: Use A/B testing to refine subject lines and content.
Using AI-driven tools: These can help automate and personalize email campaigns, improving engagement rates.

11. Direct mail marketing

Despite the digital age, direct mail still works for certain audiences. To optimize direct mail:

Use targeted lists: Use well-researched mailing lists to improve ROI.
Implement creative designs: Ensure your mail piece stands out and is easy to read.
Track mailings: Monitor responses and effectiveness.

More tips to enhance your marketing campaigns

Here are some additional tips to optimize your marketing campaigns:

Segment: Segment your target market to a specific audience. Segmentation can be done with respect to age, gender, income level, education, geography, purchase stage or brand loyalty, and more.
Business lists: Consider using high quality business lists such as Dun and Bradstreet, Experian Business, ZoomInfo or InfoUSA. These lists can be used in multiple channels as well, maximizing the value of the lists.
Track real time: Track your marketing campaigns in real-time to get immediate insights, make quick adjustments, and understand what is working or not.
Key metrics: Track the key metrics in your campaigns, such as click-through rate, engagement rate, conversion rate, sales, revenue, customer acquisition cost, market share, and churn rate.
Software and AI: Use software and artificial intelligence (AI) tools for social media management, content creation and testing of alternative ads.
Budget: Allocate your budget wisely. Assess the performance of different marketing channels and allocate your budget to the ones that deliver the highest ROI. Continuously review and adjust your spending to focus on the most effective strategies.
Keep current: Stay updated with trends. Keep up with the latest marketing trends and technologies. Experiment with new platforms, tools, or strategies to stay ahead of the competition and reach your audience in innovative ways. Keep up to date with experts by seeking articles from reputable business sources such as AllBusiness.com.
Promote across channels: Share earned media coverage on your website, social media platforms, and email newsletters. For instance, if a major publication writes about your product, feature this article prominently on your homepage or social media profiles.
Showcase social proof: Use earned media as a form of social proof by highlighting positive reviews, testimonials, or features from reputable sources. This can build credibility and trust with potential customers.
Strengthen relationships with media: Build and maintain good relationships with journalists and influencers. This can lead to more favorable coverage in the future and expand your media network.
Repurpose content: Convert mentions and reviews into additional content, such as blog posts, case studies, and infographics. For example, if your company was featured in a popular tech blog, you could create a detailed blog post about the experience and its impact.

Ready to enhance your small business marketing strategy?

Developing a comprehensive and modern small business marketing strategy requires leveraging a mix of traditional and digital techniques. By integrating artificial intelligence tools, optimizing SEO, utilizing effective SEM strategies, and harnessing the power of social media, you can create a dynamic and effective marketing approach. Start by experimenting with different strategies, tracking your results, and refining your approach based on performance data.

August Benefits News and Posts

5 Ways Small Business Owners Can Start Preparing for Retirement

FROM BUSINESS NEWS DAILY / BY KATHARINE PALJUG

FROM FORBES / BY DOMINIQUE HARROCH

Key marketing tools for small businesses

1. An optimized small business website

2. Paid search engine marketing (SEM)

3. Paid listings and display ads

4. Content marketing

5. Social media marketing

6. Influencer marketing

7. Online business directories

8. Radio marketing

9. Press releases

10. Email marketing

11. Direct mail marketing

More tips to enhance your marketing campaigns

Ready to enhance your small business marketing strategy?

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