Busy? How to Leverage your Real Estate Finance Team

Are you a busy real estate investor with multiple properties and projects on the go? Does the idea of managing the finances behind all these activities overwhelm and stress you out? 

I hear you! Managing your business finances can be daunting, especially among all the other tasks a business owner has to do. 

This is why I believe having solid finance professionals as part of your power team is essential to help you navigate these busy times with ease. With the right finance team in place, they can help you understand your numbers so you know what's working for you, track key areas in your business and plan ahead to mitigate risks. 

Here is how you can leverage your finance team through busy times in your Real Estate Investing business:

Acquiring a Property

1. Create a Money Management Strategy. When your financial infrastructure is set up properly from the start you're able to get meaningful insights from your financials fast! This means, setting up dedicated property bank accounts, having a receipt storage system that works for you and being ready to track and understand your financials either in a spreadsheet or accounting software.

2. Create a Budget. This is an essential step if you're heading into a big project such as a renovation or build. Together with your finance team, you can build a budget to account for all the income streams and expenses expected during the project phase. This allows you to allocate limited funding and make plans for the trades to hire. 

3. Forecast Cash Flow. Whether you're acquiring a turn-key property or heading straight into a big renovation or build project, your finance team can help you set expectations for what's to come by forecasting out the expected cash flow. Doing this will help you identify shortages ahead of time so you can put plans in place to cover the gaps.  

Managing a Property

1. Gauge Business Health With your bookkeeping in order, a trusted finance partner can help you understand exactly what's going on in your business. This gives you the ability to do more of what works and less of what doesn't, saving you time and energy. 

2. Track Cash Flow. Once your property is stabilized it's important to continue to track your financials, especially your cash flow. This will help you identify areas that have veered off of expectation you can pivot and adjust as needed. 

3. Manage Reserves.  Your finance team can work with you to understand and plan for future obligations such as repairs, vacancy, taxes etc. That way, there is funding available for planned and unplanned expenses, reducing the risk to the property owners. 

What is a Solid Finance Team? 

A solid finance team consists of a bookkeeper, CFO and tax accountant. The bookkeeper keeps your numbers in order. The CFO manages the health of your business; providing insights through analytics, suggesting ways to improve, forecasting and budgeting for the future and ultimately helping you grow to the next level. The Accountant handles the taxes. 

If you have these 3 professionals on your team you are set up for success and will be able to scale quickly and confidently! 

As you can see, there are several areas where your finance team can take the burden off of you. In this way you can focus on other areas of your business that require your attention, where you provide more value and ultimately spend the time where you enjoy it most! If you're a scaling real estate investor looking for a hands-off approach to your finances, book a Discovery Call today and let's discuss what it's like partnering with a Real Estate CFO.