THREE Things you can do When Managing Money Feels hard
Managing money can sometimes feel icky or overwhelming. You might ask yourself "What do I even do? Where do I start?" So today I want to focus on 3 actionable things you can do right now to be able to manage your money. And I'm not talking about setting up QuickBooks or Xero, and specific steps to do your bookkeeping. But more along the lines of how you view money, money mindset, and things to take into consideration when you start to prioritize understanding your business and personal finances.
I've talked with friends and our CFO clients about how we view money, and what we can do to really overcome that anxiety and those feelings that we get when we think about managing our finances, so that's what we're getting into today. When you start to feel out of control with money or wonder "how much am I making", or "is my business even profitable", here's 3 things to keep in the front of your mind.
Be honest with yourself
I often see people hide from their financial situation. It stresses them out so much, they just don't even want to know or look at it. And this can happen whether in you're a very good place financially, or maybe not so good where you have more expenses going out than what you're bringing in. So be honest with yourself and evaluate where you are at. Here are some questions to consider:
How much debt do you have in your business or in your personal life?
Do you have credit card debt?
Do you have student loans?
Do you have a line of credit in your business that you've been trying to pay off for months and years?
Do you have business credit card debt?
Are you breaking even? Or making good money but you don't have cash in your bank account?
Answering these kinds of questions helps you get the black and white information to help you grow your business. The cool thing about money and finances is it's plain and straightforward information that does not lie to you (as long as your bookkeeping is up-to-date and correct 😉). You can take that information, whether good or bad, and then decide how you're going to handle it.
Reshape your mindset around budgeting
Once you own up to where you're at, with what your expenses are and how much you're bringing in every month, then it's time to figure out how you're going to make it work. Maybe you want to pay off that credit card debt or student loans. Or maybe you don't have a ton of credit card debt and are mostly debt free aside from a mortgage or car payment. And maybe you're good with the mortgage and/or car payment but you want to invest in real estate or purchase or start a new company. Whatever it might be, it's going to cost money. So how are you going to make it happen and take the steps to get to where you want to be? That comes down to financial management and making a plan and creating a budget.
Now. I know a lot of people don't know how to budget. Or they don't want to, because budgeting makes it so you can't have any fun at all. I've even seen people in the financial world talk about budgets that way, where you cut and cut and don't spend any money or have any fun. Well. That's not how I budget. Do you have to watch your spending? Yes, of course. But YOU get to tell your money what to do. You're in control of your budget. Want to make a weekly Starbucks and Target run? Love it. You do that. And figure out how that works in with your plan to pay off your debts or with the investments you want to make.
You get to figure out how you can fit in your priorities as well as the priority of trying to hit your goal in the next year, 5 years, 10 years, 15 years, whatever it might be. So that's the cool thing about it is it's not limiting you. It is actually allowing you to do the things that are important to you. For me personally, I love to travel. I want to take my kids on trips and do at least one or two international trips a year and some road trips or weekend trips in the states. So I make sure to set aside money in my budget for that.
We've recently sat down and helped our CFO clients with their budgets and finalize everything for them. One of the first things they said after we walked them through it was "Okay, now where do we cut?" And can I just say, it was so satisfying to be able to say like, "Actually, you have about $5,000 extra dollars per month in your budget that we have to figure out what we're doing with that money."
So yes, there are times that you might need to be more reserved and intentional about how you spend. But that's because that is how you're going to get to the place of having your goals and more financial freedom in your lifestyle.
Recognize that it's going to take time
As hard as this is to do, trust the process and the time that it takes to get to where you want to go with money and managing your finances. And by time, I mean it takes years and years and years to feel like you have control of what is going on with your finances and really being comfortable with like where you're at and how you're managing it. Maybe you're not bringing in as much as you want to bring in, but you have a plan for your money.
Another thing to remember here is that you're going to continue to change and adjust the way you're doing things because your goals change. What you want to do in five years is always going to be changing. You're going to be learning new things. Like I'm continually learning new things on how I want to structure how we manage our finances and how I manage my business finances, and what I want to do with it. So you're going to change. But I want you to just stay consistent because this is really how you're going to get ahead. You don't get ahead in life by ignoring your finances. You don't get ahead in life by putting them in a closet and ignoring them and not really paying attention to them.
Quick recap: ONE, be honest with yourself and what financial position you're in. TWO, reshape your mindset around budgeting to where you believe "it is allowing me to accomplish things and get to where I want to be." And THREE, trust the process and trust the time that it's going to take for you to feel like you have control of your finances. And as always, you can find me on Instagram @loriannkuntz.co and then our business Instagram is @ProfitPriority if you ever want to chat about these things and hopefully you found it beneficial!
