Financial Advisor Business Plan – Revenue Streams

Showing evidence of multiple revenue streams in your financial advisor business plan presents a more sound investment to potential investors and a safer risk to potential lenders. Any business which depends entirely on the work of the founder is, by its very nature, high-risk. If that founder should become sick or unable to work, there is generally no succession plan in such a company.

Advisor Revenue Streams

Advisors can charge fees in a number of ways. The manner that most clients would prefer is for fees to be performance-based, paying the financial advisor only when their investments and holdings increase in value. Of course, few financial advisors would agree to such a fee structure, as holdings will almost inevitably decrease in value during a market downturn. A second best model for clients, and better model for advisors, is to charge a fee that is a percentage of assets under management. If assets increase in value the advisor is rewarded with a higher fee. If the value would drop, the revenue to the advisor would decrease, but not become zero. This represents that, even in bad market times, an advisor can potentially be doing better for a client than he would be doing without the help.

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Business Plans – Stop Wasting Your Time!

“Failing to plan is planning to fail!” was a phrase commonly heard as far back as high school when speaking with my career counselor.  As cliche? is the statement is, most business leaders will suggest that there is a great deal of merit to it, to the extent that most business leaders either a) have started thinking about writing a business plan, b) have started writing one or c) have one tucked away on a shelf that they haven’t looked at, ever.

Business plans take too long to write, they are more of an academic process, they are impractical, they are only used to raise money when starting a business and most good business leaders don’t need one, anyway, right?  While there have been many the albatross thrown around the neck of the business plan, we hope to give you new perspective on creating a business plan and hope that you will engage in one for your business.

In this issue of “Had an Aepiphanni, Lately?” we are going to discuss the justification of the business plan, or why the heck we need one, anyway, and how you might implement one into your daily business without it becoming a burdensome exercise.  Topics we will cover include:

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5 Tips to Proper Business Planning

Look at your business. Now look at your business planning. Do you have concrete plans in place to ensure continued success? What sets mediocre businesses apart from great businesses is the ability to properly plan their business. Business planning exceeds what you are going to do that particular day. What are your goals are for the entire year and beyond?

Business planning involves an exemplary attention to setting goals. Your goals need to be specific to your business or your organization. Use the following formula to be successful when you’re setting goals during your business planning. Your plans should consist of goals which are specific, measurable, realized, true, and timely.

Now is not a time to use generalities. You must state the purpose behind your goals. Instead of a goal being, “my business will make money this year for the company”, try “my business will make $10 million this year by aligning profitability with corporate sales metrics.” You notice the specific purpose of the goal versus the vagueness of the goal? Once specifics are out of the way, move to the next step.

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