When I was venturing into full-time entrepreneurship there were tons of resources available that discussed business set-up and the transition to being a business owner. The one area that seemed to be glossed over was a pretty important dynamic – financial advice for the self-employed.
Of course as a business owner there are many different ways to manage your income but there are some basics we all need to know and incorporate in our daily routines. It has been almost 10 years since I started my first serious business and there are a few lessons that I have learned along the way.
Lesson 1: Have a professional on your team.
Often times entrepreneurs feel we can do it all on our own. We are used to multi-tasking and wearing many hats so it comes natural to us. There are some tasks however that require a professional. Often we think of accountants and bookkeepers at tax time, but a financial professional is on your team to help you make sound financial decisions year-round and ensure you are operating in a fiscally responsible manner. Hiring an accountant allows you to focus on creating income while they can focus on managing it in you and your business’ best interest.
Lesson 2: Your time is valuable. Charge your worth.
This is one of the biggest struggles for entrepreneurs across the board. When you realize how important and valuable your time is, you will view the investment others make into your business differently. As a coach, a priceless piece of advice I received once was to think about the amount of income someone would generate after spending time in my presence and applying the knowledge that I share with them. That was definitely a game-changer for me!
Lesson 3: Have financial goals and plan of action for attaining them.
It is no secret that I believe in the power of setting goals to set ourselves up for success. The same applies to business and finances. When I began to set specific financial goals and created a plan of action to attain them, there were major shifts within my mindset, business and business accounts.
Lesson 4: Cash flow is essential.
Business is business. At the end of the day it is important to have income consistently flowing into your business to cover your expenses (like your paycheck!) and to have to have some breathing room while building your empire. I highly suggest having a savings built up prior to stepping out into full-time entrepreneurship, but I understand that is not always feasible. Obtaining financing is another option, as well, but can be a struggle if your credit is not in tip-top shape. Some entrepreneurs that I know have found success in crowdfunding options or by taking out bad credit loans and paying them back immediately with the profit from their business. Whatever you decide, making lessons 2 and 3 will assist you with bringing in the income you need to reach your short and long-term goals.
Lesson 5: Marketing is a necessary expense.
Many entrepreneurs find their ideal clients via social media. With the rise of social media marketing, those platforms have made business decisions to ensure they are able to provide an ideal user experience for their customers. Rather than balk out the lack of engagement or reach, realize that as a business having a marketing budget that includes social media marketing and other avenues is needed and necessary to continue to reach new clients.
My entrepreneurship journey has definitely led to my growth personally and professionally. These money lessons I have learned over the years have impacted not just my business but personal life, as well. I am thankful to be able to have the work-life balance that is right for me and my family and not be anxious over my finances.
What money lessons have impacted your personal or professional life?