Successful businesses manage money well. Financially savvy business executives are better at managing their money well because they have developed habits to enable them to do so. Here we share with you the seven habits of financially savvy business execs, so you can emulate their success.

 

1.    Put in place sensible budgets – it will probably come as no surprise that financially savvy business execs make sure the business has a budget that is carefully planned out and achievable. This budget will be based on research and on an understanding of actual costs and time required to achieve a goal, rather than desirable time taken and resources needed – which in many cases may be unreachable. A good budget helps to control cashflow, and it factors in more expensive costs that may be coming up.

 

2.    Keep costs under control – as well as a solid budget, financially savvy execs make sure that there is a robust process through which to manage this budget. This helps with making good financial decisions as checks are in place to avoid spending being made on items that are not budgeted or are over budget.

 

3.    Use credit effectively – even with the best laid plans and budgets in place, sometimes businesses may run into cash flow difficulties. A savvy business exec knows that in these cases sometimes credit can be used to tide the business over in the short term. Credit used irresponsibly by business can be a bad thing, but if managed in a sensible and appropriate way, credit can help businesses through times where cash flow may be challenging, helping the business to keep moving forward. Invoice loans are one example of an approach that, if used responsibly, can assist businesses through financial hardships due to unpaid invoices.

 

4.    Listen – financially savvy business executives know that they don’t know everything. They are prepared to listen to advice from others. In fact, they will even seek out advice from those that may know more, and they will listen to the answers they are given.

5.    Ask questions – listening does not mean that executives should simply accept what they are told. Along with listening, financially savvy business execs ask questions when something does not sound right, to get to the bottom of financial decisions, and make sure money is being used wisely by the business. They do not take everything at face value.

 

6.    Look for opportunities to save money – financially savvy business execs are open to finding ways to do things more efficiently. They do not stick to the way that things have always been done just for the sake of it, and instead they are open to suggestions for improvement that can save the company money.

 

7.    Seek tax breaks – there are numerous opportunities to save money on taxes in a way that is perfectly within the law, and financially savvy business executives actively seek these out. One such example that you may not be aware of is the ability to claim for tax relief or credits on research and development work undertaken. There are criteria that need to be met, and this is not suitable for all companies, but it can be very helpful for those that are doing R&D work.