Small Business Financial Planning 101: A Beginner’s Guide

Small Business Financial Planning 101: A Beginner’s Guide

The beginner’s guide to building a business that funds your life—not drains it

Most small business owners don’t create a financial plan when they start out.

They create a product. Offer a service. Build a website. Make a sale.
And suddenly, they’re in business—without a roadmap for how the money should actually work.

If that sounds familiar, you're not alone.

The good news? It’s never too late to take control of your numbers and build a business that creates consistent income, covers your expenses, funds your goals, and supports the life you’re working so hard to build.

This guide will walk you through:

  • Why financial planning matters (even if you’re “not a numbers person”)

  • The essential components of a business financial plan

  • How to set income and expense goals

  • Tools to create a monthly money routine

  • Simple systems to help you stay on track

Why Financial Planning Matters for Small Business Owners

Without a financial plan, most owners operate in reaction mode:

  • You spend money as it comes in

  • You don’t know if you can afford to pay yourself

  • You make pricing decisions based on emotion

  • You don’t realize you’re under-earning until you hit a tax bill

A financial plan puts you back in control. It gives you clarity, intention, and structure—so your business works for you instead of leaving you stressed and scrambling.

You don’t need to become a CFO.
You just need to know the right numbers to watch and the simple systems that make them work.

What Is a Business Financial Plan?

It’s a living document—or system—that helps you answer three core questions:

  1. How much money does your business need to bring in?

  2. How will that money be allocated (expenses, taxes, salary, savings)?

  3. What do you need to track regularly to stay on course?

Think of it as your business’s GPS—helping you set a destination and steer your way there with confidence.

Step 1: Set Your Monthly Owner Pay Goal

Your business needs to fund your life.
That starts with knowing what your life actually costs.

Add up your:

  • Rent or mortgage

  • Utilities, groceries, healthcare

  • Debt payments and savings

  • Lifestyle needs and goals

This becomes your Owner Pay Target—the take-home pay you want to consistently earn from your business.

Inside The Small Business Planner, you’ll find templates to calculate this and map it into your revenue plan.

Step 2: Reverse Engineer Your Revenue

Once you know what you want to take home, it’s time to figure out what your business needs to earn to support that.

Consider:

  • Your business expenses (tools, contractors, marketing, rent, etc.)

  • Your tax obligations (typically 20–30% of net income)

  • Your desired profit margin

Then reverse-engineer your revenue target.
This is your True Minimum Revenue Goal—the number your business must hit to create sustainable income and cover your costs.

→ Read: How to Set Revenue Goals Based on Personal Expenses

Step 3: Use a Simple Account Structure to Manage It

A financial plan is only useful if you can implement it.

We recommend using the Core 4 Business Bank Accounts to separate your funds:

  1. Income Account – All revenue lands here

  2. Owner Pay Account – Your paycheck

  3. Business Expenses Account – Subscriptions, contractors, supplies

  4. Tax Account – A holding account for your tax savings

Optional: A 5th buffer account for savings, deposits, or profit.

→ Read: The 5 Essential Business Accounts Every Owner Needs

Step 4: Create a Monthly Money Routine

A financial plan isn’t just something you set and forget.
It works best when you check in with it regularly.

Here’s what to do each month:

  • Review your income vs revenue goal

  • Transfer money into your bank accounts accordingly

  • Pay yourself consistently

  • Track expenses and spot trends

  • Set aside tax money and plan for upcoming costs

You don’t need spreadsheets or expensive software.
Just a clear dashboard, a repeatable routine, and a place to track your numbers—like the Monthly Financial Review inside The Small Business Planner.

Step 5: Adjust as You Grow

Your business will evolve. So will your income. Your expenses. Your lifestyle.
That’s why your financial plan should evolve, too.

Revisit your plan at least quarterly and ask:

  • Are my prices aligned with my goals?

  • Are my expenses creating ROI or just noise?

  • Am I paying myself consistently—and enough?

  • Am I still working toward the life I want?

Financial planning isn’t about perfection.
It’s about creating visibility and flexibility—so you can lead your business with confidence.

Want to Simplify All of This?

The Small Business Planner is the tool trusted by thousands of business owners to create clarity, consistency, and control with their money.

Inside, you’ll find:

  • Templates to calculate your owner pay + revenue goals

  • Monthly systems to review, forecast, and adjust

  • A complete financial framework that grows with your business

Click here to get The Small Business Planner →

Explore the Full Planning Series

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