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Small Business

How to take control of your finances in a post-COVID world

Financial strategies for small business owners

There is absolutely no doubting it, 2020 has been an incredibly tough year for small business owners in Newcastle NSW.

A client I caught up with recently, likened 2020 to the 1978 thriller ‘Jaws 2’. Recalling the famous line from the movie “just when you thought it was safe to go back in the water…” as the best way to sum up his experiences of 2020, having been impacted by the bushfires and now the pandemic.

As a nation we’re certainly hopeful the worst is behind us. But it can be difficult to know how to navigate these murky waters, and harder still to do so with confidence.

One thing that has been inevitably linked with this pandemic is change. Every single one of us, especially small business owners, has experienced significant change throughout 2020.

Changes to how we socialise, changes to our working life, and in many cases substantial changes to our income.

According to the Australian Bureau of Statistics, the impacts to businesses have been significant:

  • 66% reported a revenue decrease compared to same time last year
  • 3 in 4 businesses are now/were trading under modified arrangements compared to those they had in place as of the beginning of 20201

Running a small business during a crisis requires a serious and planned approach to managing the impact these changes can have on cash flow, profitability and sustainability – and the potential flow through impacts to your personal finances.

Furthermore, with the economic effects of COVID-19 expected to be prolonged, how can you make the years beyond the pandemic ones of greater certainty and financial security?

Here is 7 financial strategies small business owners can use to have greater control over their finances post COVID-19:

1. The first step is to get a firm handle on your complete financial situation – this includes business and personal finances.

To make sound decisions for your future, you need to know where you stand. If you have previously had steady cash flow, this may not have been high on the priority list in previous years. But uncertain times call for new measures.

As they say knowledge is power. A better understanding of your finances will go a long way to securing your future.

Consider completely separating your personal and business finances if you haven’t already.

Using your personal funds to keep your business afloat tends to be a recipe for disaster, as does using business cash flow to pay for personal expenses.

With appropriate separation in place you will have a clearer picture of your true financial situation without a false sense of security.

2. Don’t underestimate your worth

So many small business owners and self-employed Australians work extraordinarily hard to get to where they are, and this year I wouldn’t be surprised if that hard work had tripled!

But what is always shocking is how often small business owners underestimate their worth, how small their pay-cheques are, and how little (if at all) they put into super.

According to a report by The Association of Superannuation Funds of Australia:

“Self-employed people have lower superannuation balances than employees. Around 20 per cent of the self-employed have no superannuation.”

If you’re self-employed, you don’t have to pay yourself super, but it can be a valuable way to prepare you for retirement and ensure you will be comfortable in your golden years.

3. Stick to your long-term strategy

In chaotic times, it can be tempting to ditch your financial plan when more immediate issues require your attention. This can be especially common if you’re not receiving the usual returns from your investments.

But take a moment to think about your long-term goals and the benefits of your current plan. If it is viable to stick with it, you may reap more of the rewards in the long-term.

4. Find out if you can receive government support

Over the year, the government has launched a number of grants, loan opportunities and payments to support small business through the pandemic. JobKeeper payments were extended until March 2021 and while the payment amount has decreased, every little bit can help you to weather the storm.

You can check if your business is eligible for any support here.2

5. Focus on clearing unnecessary debts and loans

Clearing unnecessary debts that don’t contribute to generation of income can make all the difference for you and your business. Your previous strategies and loan conditions may no longer be well suited to your current situation and that’s okay.

Now is also a great time to negotiate lower interest rates and new loan terms to help ease the burden.

Where reasonable, you could perhaps focus on repaying your debts as quickly as possible to ensure that when the next unknown crisis hits, you will be well prepared and ahead of the competition.

Check out these moneysmart.gov.au tips about managing debt.3

6. Consider your investment options

You may be considering changes to your investment options to increase your security and income for the coming years.

Today, a diversified portfolio invested in line with your risk profile (i.e. how much risk you are prepared to be exposed to vs possible growth and returns) is more important than ever. With an unstable economic environment, investing in a number of different asset classes can help to protect your downside.

Not sure how to start planning for a successful investment? Check out some tips from Central Coast Financial Planning Group here.

7. Seek help from a financial adviser

Navigating your way through uncertain economic times is extremely stressful and time-consuming.

What I find common with a lot of small business owners is that they spend so much time working-on and working-in their business that they forget to think about themselves; and this year, self-employed Australians are even more time-poor than usual!

An experienced financial adviser from Newcastle Financial Planning Group can ensure that your strategies not only look after the future of your business but also your own future and that of your family.


If you’re ready to take control of your future, take the first and most important step. Secure your complimentary initial appointment with one of our experienced financial advisers today.

Our team can help even the most time-poor business owner manage their money in a way that delivers greater security and peace of mind.

For your convenience we have offices located at Newcastle – The Junction (NFPG), Central Coast – Erina (CCFPG), and Sydney CBD (SWA).

1 Australian Bureau of Statistics. Business Indicators, Business Impacts of COVID-19. https://www.abs.gov.au/statistics/economy/business-indicators/business-indicators-business-impacts-covid-19/jun-2020
2 Superannuation.asn.au, Superannuation balances of the self-employed
3 MoneySmart, Managing Debt

DISCLAIMER: The views expressed in this publication are solely those of the author; they are not reflective or indicative of RI Advice Group’s position and are not to be attributed to RI Advice Group. They cannot be reproduced in any form without the express written consent of the author. This information (including taxation) is general in nature and does not consider your individual circumstances or needs. Do not act until you seek professional advice. Newcastle Financial Planning Group, Central Coast Financial Planning Group, Sydney Wealth Advisers, Coastal Advice Port Macquarie and Coastal Advice Ballina Byron are subsidiaries of Coastal Advice Group Pty Ltd which is a Corporate Authorised Representative of RI Advice Group Pty Ltd, ABN 23 001 774 125 AFSL 238429.
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