The Secret to Financial Planning for Entrepreneurs

financial planning entrepreneurs

When you’re building something that you believe in, it’s not uncommon for much of your focus to go toward your company’s financial situation (keeping cash flow up, raising that next round, etc.) rather than what’s in your own wallet.

So, how should entrepreneurs approach financial planning? Matt Reiner is the CEO and co-founder of Wela, a financial planning platform that helps users develop better financial habits. As an entrepreneur himself, Reiner is well-aware of the tendency for founders to ignore their own money situation. Here, he drops some knowledge on how entrepreneurs can better manage their personal finances.

First, tell us a bit about your background and company.

Wela is a financial planning software changing the way financial advice gets delivered. We wanted to take intuition of human financial advisors and our experience of running high-net worth financial advisory firm and implement it into technology. Our ultimate goal is to make people more aware of their financial situation and develop better financial habits.

Why should entrepreneurs prioritize financial advisory?

People in the startup world are chasing their passions, often tying up the majority of their net worth into their businesses. Rather than prioritizing saving money over time, many entrepreneurs invest their financial focus and capital into their business. To achieve financial peace of mind, a shift of mindset is in order. You can be passionate about your business while prioritizing personal finance.

It’s very common for people in the startup and high growth small business world to invest or save incorrectly. That goes not only for the people running the companies, but also for the people working with them — because let’s be real, saving for retirement and budgeting your money is not sexy.

60 percent of small business owners aren’t saving the money they need for retirement, and their employees are following suit. And it’s no wonder – historically, the 401k market has mostly catered to the big guys, leaving small and medium-sized businesses to wade through expensive plans and the administrative burden. In today’s competitive environment, happy employees equals higher profits, and offering retirement options to your employees is critical for both hiring and retention.

How should entrepreneurs get started towards improving their financial health?

That depends on where you fall on the personal finance education spectrum. For some, just find some way to gain daily awareness of your financial situation. A daily spend limit can really help for beginners. Getting started might shock you and help you realize you need to create better financial habits.

Why should business owners prioritize financial wellness for their employees?

Stressed out employees cost companies money – roughly $300 billion a year as a result of absenteeism, reduced productivity levels, and employee turnover. 48 percent of employees stressed about finances also say that their finances are a distraction at work.

Wela integrates a total financial wellness program to help with retention, lower stress over financials, and allow employees to gain a holistic grasp of their financial situation. If you incentivize your employees to improve their financial health, your business will directly benefit. With the average cost to hire an employee falling at $3,976 and turnover in companies averaging 14 percent, it’s smart to invest in tools that focus on retention.

Any advice for those looking for a financial app?

Great question. I would encourage people to read up on the app’s mission and find out how their financial app is getting paid. Make sure there’s a holistic aspect of the app — it shouldn’t just tell you what your financial data is, but also provide actionable ways to help you reach your goals. Financial planning can’t be put in a silo. Your app should evolve with you as your life changes.

The way people prefer to interact with their financial advisors is changing. People are looking for an option that’s less intimidating than sitting across the table from a shirt and tie.


Matthew May is the co-founder and managing partner at Acuity.