As young people, we all have ambitions we’d love to see through: to get married, start a business, have a family, or travel the world, among other common goals.

But as we age, it becomes increasingly clear that these achievements don’t simply find their way to us – everyone has to strive to reach milestones that mean a lot to them.

If you’re an entrepreneur or an executive, you may be fully immersed in your working life. Reaching a successful point in your career feels incredible, but if you’re living and breathing your work day-to-day, your other important aspirations may have fallen out of focus.

Indeed, it is likely that you still have your personal goals in the back of your mind; you’d like to retire “when the time is right”, or support your children financially “at some point”. While well-intentioned, these vague goals could be difficult to achieve.

Read on to discover why these vague aspirations could be harmful to your long-term plans, and how being more intentional could revolutionise the way you set goals.

3 reasons for business owners to set clear personal goals

You’re likely to be well-accustomed to setting measurable targets where your company is concerned. Fiscal goals are key to a company’s success, as all entrepreneurs know – yet this same theory is rarely applied to personal finances.

Here are three reasons all business owners and executives could benefit from setting clear personal wealth targets.

1. You are less likely to rely solely on your business to support your retirement

As you may have read about in our previous insights, business owners can often make the mistake of relying entirely on a business sale, or continued income from the company, to fund their retirement.

In doing so, you may:

• Pass up on tax-efficient pension saving opportunities
• Ignore the need for a “plan B” in case the business cannot fund your retirement
• Put your family’s financial stability at unnecessary risk.

Setting measurable wealth goals could help you to avoid this. With the help of a professional, you can find out how much you need to retire comfortably and begin working towards “your number” in the years between now and when you retire.

Then, if funds from your business are not sufficient to support you throughout retirement, you can rely on your pot of personal wealth later in life.

2. You may be able to retire at an age that suits you and your business

Many business owners that we meet often say the same thing about retirement: “I’ll step down when the time is right.”

While there is some wisdom to this sentiment, it is rather vague. There will never be a perfect time to step down, and without a clear plan, you could continue to work past your ideal retirement age simply due to the worry that things won’t run smoothly without you.

Once again, clear-cut goal setting may help here. Preparing up to a decade in advance for your retirement with a specific year in mind could:

• Allow your team to adjust to the transition over time
• Give you the opportunity to prepare your business financially
• Explore market options that are right for you if you plan to sell the company
• Find an appropriate successor and ensure they are ready to replace you in the role.

For these steps to take place, you need to take charge of your own retirement date, rather than leaving it up to circumstance.

So, it may be constructive to begin looking at your future with a clear focus. Think about:

• How you’ll feel about running your business full-time in 5, 10, or 15 years
• Your vision for your business’s future after you are no longer at the helm
• Whether your personal wealth could sustain you in retirement
• When could be a suitable time to retire, not just for yourself but for your family, too.

Precision is key here. If you are unsure where to begin when thinking about the above, working with a financial planner could be hugely beneficial.

3. You could offer helpful financial gifts to your loved ones

It is likely that you have already thought about how you would like to help your spouse, children, and grandchildren thrive in life.

From boosting the next generation onto the property ladder to leaving a generous inheritance when you pass away, there are so many ways to financially assist your loved ones.

However, being vague about these goals could have serious pitfalls.

Firstly, when promising funds to others, it’s important to be intentional and stick to your word – wishy-washy financial commitments could lead to problems down the line.

Similarly, if you know you would like to offer money to your loved ones for a specific purpose, it may help to start laying funds aside sooner rather than later. If you are unable to provide the money at the moment, consider working out a time frame over which you can save the money and communicate this to your family members as soon as you can.

Being clear about how much you are able to give away now, or leave as an inheritance later, may help to avoid family conflict and could help your loved ones make the most of what you give.

Setting personal finance goals can be challenging. Our financial planners are here to assist

Making plans for decades in the future can be difficult without professional tools on your side – especially if you are a busy entrepreneur without much time to spare.

At iQ Financial, we specialise in helping “time-poor” business owners to set clear-cut personal goals aided by a bespoke financial plan.

To find out more about how we can help you turn your vague ideas into a robust action plan, email us at clients@iqf.ie, or call 353 71 915 5560.

Please note

This article is for information only. It does not constitute advice.

It describes financial planning services that iQ Financial can offer to you. Financial planning services are not regulated by the Central Bank of Ireland.

iQ Financial is not a tax adviser and tax advisory services are not regulated by the Central Bank of Ireland.