THE IMPORTANCE OF FINANCIAL PLANNING FOR MICROENTREPRENEURS

Abstract

This article examines the critical role of financial planning in the success and sustainability of microenterprises, particularly in environments characterized by financial constraints and limited access to formal credit. It argues that structured financial planning—comprising the definition of financial goals, budgeting, and risk management—is essential for informed decision-making and long-term viability. Drawing on empirical evidence from the literature, the article demonstrates that financial planning enhances the resilience of microentrepreneurs, improves financial behavior, and supports inclusive economic development. Despite its importance, many microentrepreneurs lack access to financial literacy resources, underscoring the need for targeted educational initiatives and policy support. The findings highlight the strategic function of financial planning as both a managerial practice and a development tool.