Most of my clients have lasting results with the money changes we make. But what makes some clients more successful than others? I don’t judge success by dollar amounts of debt paid or profit made. Some of my most successful clients had overall smaller dollar changes.  I judge success by my clients reaching their financial goals, staying protected at their income milestone, paying themselves and having great job satisfaction. If my clients can remove the stress and uncertainty that can come up around money, I call it a win.  But my most successful clients all have three qualities about them that made them “extra” successful.

1 – They have a money goal and a purpose for the money.

My most successful clients have a money goal. Saving to buy a building, leave the 9 to 5 job, open a day spa in 3 years are all examples of my client’s goals and purpose for a set amount of money. These goals aren’t fuzzy. They know how much they need, and they have a timeline to make it. If they don’t start that way, they get it when we work together. If your money goal is “as much as possible” or “as much as I need to cover overhead” you likely don’t have the same laser focus to create and make money as my most successful clients do. The truth is, if you aim at nothing, you’ll hit it every time. You need to define and write down your goals with a plan to reach them. Not that plans can’t grow, change, and evolve, but if you don’t start with one at all you aren’t going to be able to really measure your progress.

2 – They take immediate action to control their money.

They opened the holding account, they took the utilities off autopay, they started tracking income every day. Some of my clients have done those tasks the same day we have our session! Keeping their laser focus on the goal they take quick action and have wins immediately. I have seen less success with entrepreneurs who are slower to make necessary changes. The motivation to get it done quickly goes away, and often only about half of the recommendations make it into the business. They may pay their expenses intentionally, but they don’t make the time to create a monthly spending plan (budget). My most successful clients commit to making changes with their money quickly, one step at a time, and they follow through right away.

3 – They celebrate every financial win and use them to stay motivated.

Let’s face it, saving 5 years for a building can get a little boring. Every $200.00 deposit seems tiny in the face of the price for a building. But my most successful clients celebrate every single win, whether it is a deposit into a building fund, or a payday when they proudly sign both the front and the back of their paychecks. Staying motivated can be difficult sometimes, and we all have to deal with the sometime lack of motivation. Celebrating the little things brings joy into the progress, not the end state. If you aren’t celebrating and doing a little dance after every sale or payday, I challenge you to start today. Find a small money win and recognize it with gratitude.

When the Breakthrough Number (B-Number) process was developing, I used it for the easy visualization of protecting the inside of your business four walls. It was first created to support a client who knew of the Dave Ramsey “7 Baby Steps” approach to personal finance. Each of the walls I identified for business helped her make decisions on how to spend money and to put processes in place for money management. Over time I continued to use the approach over and over and finally gave the process a name…

The Breakthrough Number

I know what should happen when people figure out their unique number. They should be more in control of their income. They will know their minimum monthly amount of money the business must bring in, reducing stress and uncertainty. Finally, they will see the wisdom of including their own salary in the business spending plan (budget).

What I didn’t foresee happening were these additional, unexpected benefits that came with working through the calculation process.

 

  1. More accurate wholesale costs.

I’ve worked with several business owners who forgot something, some small or easily forgotten expense that affected their profit margin. Running through each of the walls carefully uncovered things like the cost of blank labels and ink for handmade products. That cost was easily overlooked because it was under $25.00/ month, but it needs to be included because it affects the real cost to the business and needs to be recovered.

 

2. Finding hidden money and a chance to become leaner.

The first time this happened I was actually in an airport helping a friend run through the breakthrough number process. We were discussing her critical operating expenses and remembered that she had a service she paid for every month that she was no longer using! This service was about $100.00/ year. More than once I have seen clients eliminate or change services and expenses when they take a hard look at deciding what is critical.

 

3. More confidence in making strategic business decisions.

This benefit was sort of foreseeable in that I knew people could use the process to calculate different scenarios such as hiring new people or adding a service because they would be able to forecast the new expense’s impact on the money. But the way my client uses it to make decisions is quite surprising! She literally just uses her known monthly B-number amount to help her make decisions. Her breakthrough number is about $5k a month and included her personal paycheck. Anytime she wants to do anything different she looks at how much she made over her number that month and how much she has in the bank. She can then say, “Oh, this is okay, I made an extra $2k and I can still pay myself for 3 months.” That was her quick ‘back of the envelope’ calculation for hiring her part-time VA and a business coach. Amazing!

 

If you are still without your unique number you can get it today, right now for free.

Just visit http://entremoneycoach.com to grab your free worksheets. You will have your number in under 30 minutes! Happy Entrepreneuring!  

 

  1. Not separating Business from Personal Accounts. You must have a separate financial identity for your business, even as a solopreneur or freelancer. Keep your money separate and write yourself a paycheck from the business. No living out of the till. Use a fee free checking account for all of your business income, and pay your expenses, including your paycheck, at regular intervals from that account.

 

  1. Immediately Making Large Purchases for the Business. Often these large purchases are made on credit, putting the business immediately into the negative with debt. Do you need that new computer right now? How about that website? All of those services? Keep the business lean by purchasing only the necessities. Know your B-Number to determine the amount of money you need to make based on prioritized expenses and put large purchases on hold until you have the cash.

 

  1. Having too Much Personal Debt. Personal income is often dipped into when businesses are first starting. Until the income really gets going, it’s not unusual to pay for certain expenses from personal funds. Having a large personal debt load means less money available for business expenses if needed for perhaps a marketing funnel or to pay a large expense that comes up. On the other hand, if you are relaying on your business to pay all of your bills, personal debt means more money needed from the business, and less money staying in the business for growth or new launches.

 

  1. Not Saving for Emergencies and “Down Times.” Business is cyclical. It just is. Income will be variable, particularly in new businesses who are starting to get visibility and a steady income stream. It is always a good idea to keep an emergency fund on hand- set aside into a free checking account for those months where you don’t make enough to pay those B-Number expenses. Some advice for starting and funding an emergency fund can be found here.

 

    1. Not Having a Clear Spending Plan for Your Business. Money can easily run off and spend itself when your business doesn’t have a spending plan. Always starting from the B-Number, where is any extra money going? You may get by for a bit, but having a plan ensures you can afford to take certain steps in your business. Taking 45 minutes a month to map out upcoming expenses or expansions and what you plan to spend where. If you need accountability or help with your plan, go ahead and check out our Business Money Planning Group.10

The concept of the business pivot is not new, I learned about it several years ago when I was in the Syracuse University V-WISE program for women veteran entrepreneurs.  Traditionally a pivot is a term to describe a strategy to turn a business when the current business model isn’t working, a plan “B” if you will.  But I also see a pivot as a strategy that can aid expansion of a business. I don’t think a pivot is only a plan B, but can be a business strategy for small turns, little twists that steer the business to look in an additional direction.

 

Entrepreneurs are, by nature, change agents. Known for figuring out ways to do things better, ways to take calculated risks. We are also known for continually searching for the “next thing.” I believe that using a simple pivot analysis can help you find the next move for your business. Again, I don’t ascribe to a pivot as something to do only when things are going wrong. I believe that a little turn deserves a pivot analysis, so risks can be weighed in a structured, but simple, way. Use this three-step process to discover your next business move.

 

  1. Commit to use openminded and unfiltered brainstorming. For best results, use the recommendations by Jennifer Jackson of Lucid Chartand just get every idea down on paper, and edit later.

 

  1. Use the Entre Money Coach ADFP Formula. Ask open ended questions about your Audience, Delivery, Focus, and Processes for places to improve, serve, and expand. Get the Free ADFP Process and questions to ask by visiting> here.

 

  1. Use market research to explore ideas. Don’t just throw out unusual ideas as bunk. Do a little market research to see if there is a fit. There are all kinds of free resources online to help you. Don’t forget to look at adjacent industries and at your own industry for ideas and changes going on that can support your ideas.

 

Some of the best business moves are those that seem to be a natural twist or progression. A pivot doesn’t have to be dramatic to impact your bottom line positively. Happy Entrepreneuring!

Entrepreneurship means always having to say, “no worries,” even when we are worried. And as a group, we worry a lot. We want to be relevant, successful, financially secure. We are, in many cases, able to separate what we can control, and what we can’t control. But where money is concerned, 60% of entrepreneurs lose sleep when there’s a crunch. It’s safe to say that we struggle with the control thing when we are talking about our money. I am guilty of this too and am still working on it.

 

So why are we so crazy about the money? For many of us, it’s our metric of success. When we are responsible for every aspect of our business, from finding clients to keeping staff happy, juggling vendors and paying the bills, we gauge how we are doing by the amount of money we make. But when we use the bottom line as the only metric of our success any changes in the cash can increase the stress to unbearable levels. So, what can we do when we feel the financial stress rising up?

 

  1. Recognize the stress. Stress can zap your creativity and ability to make the best decisions you can make to get through a rough patch. If you can see stress rising in yourself when you review the financials you can take action to mitigate its effects. Don’t wait until you can’t sleep or turn off your brain to take action.

 

  1. Admit what you can’t control, and act accordingly. I have worked on this one for a long time. I can’t control if my invoice gets paid on time. I can’t control when people cancel appointments. I can’t control when packages arrive late. I can take affirmative steps to prevent these things from happening, but I cannot control these events when they happen. When I realize I cannot control the event, I give myself grace and a timeline for being upset.

 

  1. Don’t lie in bed and worry about money. Worry at the desk. Fine. The dinner table, fine. Not in bed. That’s not fine. If it’s not in the bank when the bank closes, it’s not in the bank. Your being up at 2am worrying about the money in the bank won’t affect your balance one bit. It will affect your ability to show up the next day. It will affect your health. Train yourself to keep financial stress outside the bedroom. If you wake up in the middle of the night and have financial worry- get up. Take it outside your sanctuary.

 

  1. Find non-monetary measures of progress and success. In today’s business world there are metrics everywhere. Websites and social media platforms can show you how you are reaching out and impacting the world. You don’t only need to measure by the money. What are a few ways you can look at your progress now without the bank book?

 

  1. Give yourself CEO space. No people. No projects. No progress reports. Schedule an hour or two a week to close yourself off to think, reflect, and to be by yourself. Use this time to brainstorm, meditate, listen to music. To Just BE. I’m still working on this. Entrepreneurs by nature are human doings much more than we are human beings.

 

Money stress when you are not in control does nothing to impact your bottom line and everything to affect your health and creativity. These skills are a work in progress for most of us. But managing to keep money stress at bay by focusing on other measures of success, ensuring a good night’s sleep, and reminding ourselves where we aren’t in control will make running your business less stressful. Happy Entrepreneuring!

NOTE: I am not an insurance agent, I don’t sell any policies, I don’t recommend products and that is best left to the professionals in the field. This is just mine and my husband Mike’s story. A story about what we wish we knew to protect our family as small business owners. I am sharing primarily because I work with entrepreneurs and these are the things we wish we would have known back in 2013. 

As the Entre Money Coach I get asked frequently, “What made you become a financial coach?” So, I am just going to share our raw story, and our mistakes that closed our previous company.  That closure threw us into severe financial difficulty, and took nearly  three and a half years to dig out. Also, this post is not about life insurance, the most obvious, or even insurance for our physical business. I want to share the types of insurance that we didn’t know about but can perhaps prevent financial ruin for another family.

When Mike wanted to start a consulting business in 2011, I was so excited. And it was great. It really was. Mike and I followed the state guide, took all the legal steps, got our business license and set up our office space in our home. Then we took courses through the Small Business Administration and met with awesome advisors through SCORE. In short, we followed the “rules.”

We had a business plan, a (now defunct) website, worked hard, read everything, learned a lot, made a ton of rookie mistakes, embraced them, kept going. After about a year or so, we thought we had it figured out. And for the business, we sorta did. But today we talk about UNEQ Consulting (pronounced unique), LLC, in the past tense. It’s been gone since March of 2014. Because on November 1st 2013, Mike was working at a site in Eufaula, Alabama and fell head first 18 feet off of a ladder. Onto concrete. Yup. In three seconds, our life was changed forever.Mike survived the accident. Thank God. Had he passed? This would be a different conversation. But Mike survived, with a severe head injury and years of rehabilitation ahead. But this post isn’t about the accident.dandelion seeds blown into the air

Here’s why our story is important. It’s about what we didn’t do, and really never thought about. It’s our mistakes in not protecting our family and livelihood first as self-employed small business owners. I am sharing so that you can make different decisions.

So, here’s a short list of what we wish we had done:
Had a management reserve, or emergency fund with three months of our B-number saved in it, so we could take regular paychecks for a while. 
  • Had some sort of disability insurance on Mike, or “business continuity” or Key Man insurance.
  • Understood that unemployment insurance is for the employed- just not the self-employed
  • And that Social Security has an “exclusionary” period for around five months, where even if you are approved, there is no back pay
  • Not incur unnecessary debt.  For example, credit cards “we paid off every month.” We paid them every month until the income ran out, the deductibles started needing to be paid, and I had to choose. I have a course module on when it is the “right” time to leverage for growth. But we weren’t doing that. Sometimes our b-number went on the plastic and that was a big mistake

November 1st, 2019 just marked six years since our life changing event. Mike has made an amazing recovery, and it took years of digging in and working hard to recover financially. We paid it all in full, including the IRS lien on the house (for back self-employment taxes), and have sworn off personal debt. Over those six years we have been busy. I finished law school and became a consumer attorney and financial coach. Mike went through three grueling years of rehabilitation and walks without a cane.

This is why I coach entrepreneurs to avoid the financial mistakes we made. I want your business to serve your customers for many years to come. Long after the scary 5 year statistic. We hope that this post reaches just one person who needs to read it, and that they take action now to protect their livelihood and family. Please share our story with every self-employed person and small business owner you know.