A financial plan is a financial tool you can utilize both for business and personal use. It helps set priorities towards financial freedom and growing a business. Companies which want to achieve specific financial goals utilize financial plan before making business decisions.

Preparing a financial plan serves as a guide for the company's management and employees. It makes the company's financial objective more tangible and encourages employees to achieve those goals.

5 Major Aspects of a Financial Plan Template

1.Sales Forecast

Forecasting sales targets company earnings and work hard to achieve those targets. It helps align the company's action toward achieving the set goals. To project sales, you need to identify your market demand, capacity to produce and sell prices. Setting short-term and long-term sales forecasts will help you reach the target faster.

2.Estimating Expenses

Preparing proper estimates of your expenses to help measure your capacity to finance the business. It can also aid you in finding backup funding sources in times of significant cash outflows. Projecting expenses can get you out of trouble when unusual expenses happen.

3.Personnel Plan

When you are starting, there might not be a need to hire workers. However, as the company grows, you need more people to attend to your business and additional customers or clients. To ensure that you can hire the best-fitting personnel, you need to provide competitive salaries and benefits to your employees.

4.Financial Statements

Financial statements are composed of the income statement, balance sheet, and cash statement. The income statement projects revenues and expenses and shows accounting profitability. The balance sheet constitutes assets, liabilities, and owner's equity. The cash flow statement presents all the cash transactions and assesses the company's capacity to meet day-to-day financial transactions.

5.Financial Analysis

Financial analysis is a helpful tool to understand better the figure in financial statements. Financial ratios such as profitability ratios, liquidity ratios, growth ratios, and leverage ratios utilize different aspects of the income statement, cash flow, and balance sheet to make an in-depth analysis of financial transactions and projections.

Preparing a financial plan provides a significant impact on your company's goal setting and achieving those goals. It makes your plans more concrete and achievable. There are available financial plan templates online fitted to your business that you can utilize. These financial plan templates help you save time and resources compared to preparing from scratch.