This is the third of a three-part series about working with business owner clients. Be sure to go back to part one here and part two here.

As a financial coach, your primary goal is to guide your clients to financial clarity and success, whatever that means for your client. But if you coach clients who are business owners, the line between their business and personal finances may be blurred, leaving too much room for uncertainty.

Many entrepreneurs struggle with managing their finances effectively, creating cash flow issues, difficulty in determining a proper paycheck, and inaccurate tax estimates. By helping your clients separate their business and personal finances, you lay the foundation for strategic growth and long-term success.

So let’s talk about proven strategies for coaching business clients, drawing from my experience as a financial coach who has helped numerous entrepreneurs navigate the complexities of financial management.

Start with the Basics

Before diving into more complex financial strategies, it’s crucial to ensure your business owner clients have a solid understanding of their current financial situation. I like to start by providing them with worksheets that summarize their personal expenses, non-business income, and the paycheck they need from their business.

The goal of these steps is to separate business and personal finances so that we can properly determine a paycheck amount, but we also want the client to understand how we got that number.

Narrate Your Process

When working with spreadsheets, I’ve found that narrating your thought process is essential. Let your clients hear the steps you’re taking, so they understand the reasoning behind your recommendations.

As you go through the numbers, remind them of the goal: to create separation between business and personal expenses, determine a paycheck amount, set aside money for taxes, and establish clear revenue targets.

I often say something like, “Okay, your total personal expenses per month, the amount that it costs to live and support your family, is $6,780 per month. That includes things like your housing, one of your vehicles, food and some miscellaneous expenses.”

Identify Strengths and Gaps

Once you’ve completed the basic steps, help your clients see the strengths and gaps in their business. This newfound clarity will allow you to focus your attention on areas that need improvement.

Summarize their total personal expenses, non-business income, required paycheck, estimated taxes, and total business expenses. I usually say something like, “Based on a paycheck of $2,800 we estimated your taxes on that as $700 so I’ve also added that. We will dial those in but for now, that at least gives us a really good idea of what you’re looking at. If we take your pay and add that to your other business expenses, things like your car, marketing and the tech you pay for, your total business expenses per month are $12,300.”

Encourage your clients to think critically and creatively about how to generate the revenue needed to cover these expenses consistently. I often ask, “I’m curious when you hear that number, how do you feel about that?” This sparks a conversation about their current revenue and helps them understand the importance of setting realistic financial goals.

Implement a Solid System

Identifying expenses is just the first step; managing them effectively is equally important. Help your clients understand the Plan Ahead Method for both personal and business expenses. Provide practical guidance on when to pay certain bills, when to manage their finances, and which accounts to use for specific expenses.

As I explain to my clients, we want to get strategic with their pricing model, evaluating their revenue goal and targets and analyzing their expenses, which means we can’t be putting out fires in their cash flows. We have to remove the chaos and get the day-to-day management of everything dialed in so we can focus on these other things.

Establish a Consistent Paycheck

Everyone needs a paycheck and business clients are no exception. Encourage your clients to pay themselves consistently, mimicking the schedule of any other income they receive (e.g., a spouse’s paycheck or a day job salary). This consistency will help streamline their money patterns and allow for better financial planning.

I often say, “Your paycheck is $2,800 per month. Your spouse gets paid every other Friday, so I want you to match that schedule with your pay. I want to streamline your money patterns as best as we can. So I want you to transfer $1,400 every other Friday from your business checking account to your personal checking account, like clockwork. This is your goal.”

Remind them that their paycheck is now a business expense, and they must generate enough revenue to cover it along with other business costs.

Balance Short-Term and Long-Term Strategies

As a financial coach, your job is to help clients juggle their day-to-day financial management while focusing on long-term strategies. In the beginning, there may be some real-time effort required to ensure a smooth transition. I often tell my clients, “So over the coming month, we’re going to be tackling things on two fronts – we are going to stay on top of your budget and cash flow daily and weekly – making sure you have enough in the right account to pay the proper expenses and can take your paycheck. Depending on the revenue target and where you are currently in business, we might have some juggling we have to do in the first month especially.”

However, by analyzing their business and implementing effective systems, you can help them create a sustainable and successful financial future. As I explain, “Meanwhile, we’ll also be analyzing your business in other ways so long-term you know it’s set up to be successful and it doesn’t require so much real-time juggling. But at first, it’s going to be a bit of both. That’s my job – to help you juggle what’s happening today, put a system in place that works, while focusing on the long-term strategies you need. My job as your financial coach is to facilitate both of those things at once.”

Dive Deeper with Continued Coaching

Once you’ve laid the foundation, you can delve into more advanced strategies with your clients: refine their payment methods, tax strategies, and pricing models; analyze their revenue patterns, debts, and expenses to identify areas for improvement. This is also where you help them create organizational guidelines, establish performance measures, and develop growth strategies tailored to their unique business needs.

Some of the areas you can explore with continued coaching include:

  1. Refining HOW they pay themselves (paycheck, draw, dividend, or commission based on profit)
  2. Refining their tax strategy (how much they’re saving each month vs. remitting)
  3. Identifying if they have a revenue problem or a spending problem (and if it’s in their business, personal, or both)
  4. Analyzing their pricing model and determining if it’s viable for their revenue targets
  5. Looking at revenue patterns and determining if they’re consistent or random
  6. Analyzing debts and devising a debt payoff strategy
  7. Helping them create organizational guidelines for their business to simplify tax preparation
  8. Crafting short and long-term savings strategies, including preparing for business emergencies or growth opportunities
  9. Establishing performance measures and tracking procedures
  10. Developing specific growth strategies, such as 10% drivers, assessing growth endeavors, and providing resources for the next step

These are all things you’re able to do with clients when you continue coaching because you’ve completed these foundational steps. Not every one of these concepts is discussed with every business client because not everything will be relevant. But we’ll be able to tell that by first getting really streamlined and creating clarity around their business finances.

Empowering Your Clients for Financial Success

By following these strategies, you can empower your business clients to take control of their finances and make informed decisions. Remember, your role as a financial coach is to provide practical, actionable advice that helps them navigate the complexities of managing a business. With your guidance and support, they can achieve financial clarity, set realistic goals, and grow their businesses with confidence.