The start of a new year is the perfect time to set clear financial goals for your business and is something we do at DNA every January.
Setting goals is just the beginning – achieving them requires careful planning and the right tools. Here’s how we’re tackling 2025 with Xero as our secret weapon.
Setting Clear Financial Goals for 2025
When setting financial goals, it’s really important to use the SMART method – to have specific, measurable, achievable, relevant and timely goals.
Using some examples:
Rather than saying “I’d like to increase revenue in 2025”, set a goal of “Increasing revenue by 10% by the end of 2025 by onboarding 1 new client per month with an average annual fee of £2,000 each”.
Rather than saying “Keep more clients happy”, set a goal of “Improve client retention rate from 85% to 90% by December 2025 by implementing quarterly check-ins and feedback surveys for all clients”.
Rather than saying “Help the team grow professionally”, set a goal of “Ensure all staff complete at least 20 hours of CPD training relevant to their needs by December 2025 including courses on tax legislation and Xero certification.
Using Xero as the Backbone of Financial Management
As you probably all know by now, we love Xero and not only recommend it for our clients but also use it for our own practice bookkeeping.
We love the fact that there is:
- Real time financial visibility
- Automation for recurring tasks (eg invoicing and reminders)
- Integration with other apps for seamless operations
One of the things I love to do is to separate out our bank balance into various “pots” in our banking App to save for future liabilities. We use Starling Bank and I have 4 different pots attached to the account to save for VAT, Corporation Tax, Rent (paid quarterly) and PAYE/NIC bills.
At the end of every week, I run a VAT report in Xero and transfer money into the VAT pot to make sure the balance in that pot equals the VAT balance.
Every month I transfer over ⅓ of the Rent bill into the Rent pot to save for the next quarter’s rent.
When I process the payroll I transfer into the PAYE/NIC pot the amount due to HMRc by the 19th of the following month.
At the end of every month, I run a Profit and Loss report in Xero, calculate the estimated Corporation Tax and transfer that amount into the Corporation Tax pot.
These transfers all help me sleep at night as I know that all future liabilities are covered and also means I can’t spend that money as it has been earmarked and isn’t in the main general account.
Our Financial Review Process
This is what I do on a regular basis to make sure we are up to date in Xero which then means we can review and keep on top of our Financial Goals
Daily Review:
- Check bank feeds in Xero for accuracy and reconcile transactions
Weekly Review:
- Review aged debtors and creditors reports.
- Transfer monies into VAT pot
- Review monthly invoicing to make sure we are on track for Revenue goals.
Monthly Review:
- Prepare and analyse profit and loss (P&L) and balance sheet.
- Compare actuals to budget/forecast and adjust plans.
- Transfer PAYE/NIC liability into separate pot
- Transfer Corporation tax estimate for the month into the Tax pot
Tips for Staying Consistent and Motivated
One of the best things to stay motivated with goals is to celebrate achievements. We have a running “best month ever” celebration (which normally means a “cheers” in the evening for Ian and I).
We also like to get the Team involved so one of my January “gifts” is to allow the Team to nominate a client they would like to lose. Obviously there has to be a good reason for doing so but it shows we are listening to the Team and taking their feelings and worries into account.
Conclusion: not just setting aspirations, but creating systems
Achieving financial goals for your business isn’t just about setting aspirations; it’s about having the right processes and tools in place to make them a reality. At DNA, we’ve found that combining clear, SMART goals with Xero’s powerful features creates a winning formula for success.
By breaking down financial reviews into daily, weekly, and monthly tasks and using strategies like creating dedicated savings pots, we ensure that our practice runs smoothly and future liabilities are covered. These small, consistent habits add up to big wins, giving us the confidence to grow sustainably while maintaining a positive and motivated team environment.
As you plan for 2025, remember: success is built one small action at a time. Whether it’s reconciling bank feeds daily or celebrating milestones, every step brings you closer to achieving your goals. And with tools like Xero, you’re never tackling those goals alone.
Let’s make 2025 a year of growth, stability, and success for our businesses. How are you planning to achieve your financial goals this year? Share your thoughts—we’d love to hear them!
