Five-Year Planning: Forecasting Revenue, Costs, and Personal Income
Most makers don't plan beyond next month. That's why they're reactive. A simple 5-year plan gives you direction and lets you see how today's decisions compound. This guide teaches you to create a realistic forecast.
Building Your 5-Year Forecast
Start with realistic assumptions about growth:
Year 1 (This Year)
Current trajectory. What you'll actually do based on existing customer base and marketing.
Example: $100K revenue, $35K profit, $32K personal income
Years 2-3 (Steady Growth)
Growth comes from marketing, word-of-mouth, new products, and team scaling. Plan 15–30% annual growth if you execute well.
Year 2: $125K revenue, $45K profit, $40K personal income
Year 3: $155K revenue, $58K profit, $50K personal income
Years 4-5 (Scaling Or Plateauing)
Either you've built systems to scale (higher growth), or you've hit a natural ceiling (slower growth). Plan accordingly.
Year 4: $190K revenue, $70K profit, $60K personal income (if scaling)
Year 5: $230K revenue, $85K profit, $72K personal income
Reality check: These numbers assume you execute. No execution = flat growth.
Mileposts (Years When Things Change)
Don't just forecast numbers. Forecast what happens in each year:
Year 1: Stabilize core product. Build email list to 1,000. Launch second product.
Year 2: Hire part-time help. 50% growth in revenue. Launch seasonal campaigns.
Year 3: Hire full-time assistant. Test new product line. 40% growth.
Year 4: Evaluate: keep specializing or expand to new market?
Year 5: Build to next level (sell, employ more, or sustain at current size).
These milestones drive the financial forecast. Revenue doesn't magically grow—you do things that cause growth.
Making It Real
Write your 5-year plan down:
✓ Create a simple spreadsheet with revenue, expenses, profit, personal income by year
✓ List the actions/milestones that drive each year's growth
✓ Review it quarterly—update as reality changes
✓ Use it to make hiring/investment decisions
This isn't about predictions being "right." It's about having a direction and adjusting as you go.
Plan Your Five Years. Build Your Future.
TrueCraft tracks your actual results against your 5-year plan so you stay on track.
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