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How Wealth Advisers Can Help Small Businesses

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Running a profitable business isn’t easy. In fact, only 50% of businesses fail in their first four years, and it only goes down from there on out. So running a thriving business is certainly an achievement.

However, if your business is already making a nice margin, one of the worst things you can do it to put it in fixed deposit or “sweep” account. These accounts usually earn an abysmal interest rate.

Sure, they’re easy and convenient. But seeing as you have worked so hard to earn the money, you should make it work a little harder for you. Remember wealth advisers? They’re not just for rich individuals. They can definitely add a lot of value to your business.

How Wealth Advisors Can Help

When one thinks about wealth advisors, the connotations are that of high net worth individuals and extremely successful companies. Many ordinary people and smaller companies, however, also use the services of wealth advisors like Sanlam Private Investments in order to manage their capital more effectively. Using experts who can create a bespoke investment package for you may mean far greater returns on your capital, helping your business and its profits work 2x as hard for you.

So, what can a wealth advisor do that you can’t? A good wealth advisor should have the expertise and knowledge of the various financial instruments that are a good fit for your business. Based on what you’ve forecasted for business expenses etc, they’ll allocate funds into short term deposits, or longer term assets like your traditional – stocks, bonds, mutual funds etc.

Building Your Portfolio

A wealth advisor will work with you to build an investment portfolio that best suits your situation and your financial goals. You will find that there are a range of financial products on offer and that each will vary in the way that it performs.

For example, you may opt to put your money into a product that offers very high returns, but comes with a certain amount of exposure to risk. Alternatively, you could consider something that offers lower returns, but without any exposure to risk or a combination of both – you don’t necessarily have to put all of the capital into one specific investment or product.

Often diversifying your investment portfolio is the most sensible path to follow and over time you can move capital around from one product to another based on how the products are performing – periodic reviews of how the portfolio is performing are part of the key to successful investing. Plus, the more experienced you become, the more likely you are to want to explore new ways to make your money work.

The Bottom Line

The bottom line is that there are many ways in which you can make surplus capital work for you and the best way to exploit this is by seeking advice. A secure future is something we all aspire to and achieving one only comes through hard work and a proactive approach to investing.