Ask and you shall receive! I consider myself to be incredibly fortunate to know several entrepreneurs. When they asked me to write a blog around the specific financial struggles they face as business owners there was no way I could refuse.
I must say, I struggled with where to start regarding this topic because there is an added layer to finances that non-entrepreneurs don’t face, variable income. You have to financial plan for your business in addition to your personal life…and we all know how much fun personal budgeting is. Also I struggled with the question of how do I make it impactful for you when there is SO MUCH to be said?
I realize as an entrepreneur you don’t have a lot of time to sit around and read an incredibly lengthy article that drones on…or so a little bird told me. So I am going to break this into a three part series for ya… (Not an entrepreneur? I promise there is still value to continue reading or maybe just pictures of puppies)
Here is how I envision what this series will look like
Part One: Defining Wealth, in your own terms
Part Two: Entrepreneurial Budgeting - it's not for the faint of heart
Part Three: Future planning..... *Author's note: I am still working on this title*
I can feel how excited you are about this...so let's get to it.
Part One: Defining Wealth, in your own terms
The foundation of any financial plan is a solid budget. As a business owner you are going to need one for both your business and personal spending. However, before we can build that budget we must know what our objectives and goals are. When clients come in the first thing they ask is what is the magic amount of money I need to be successful and happy? My answer is always the same…Tell me what your idea of wealthy, successful and happy is, then we’ll design a plan around that!
We associate success and wealth with the amount of money in our bank account. When we use this as our only assessment of wealth we create intensely negative emotions when we don’t succeed; shame, blame and judgement just to name a few. These emotions are fed as we allow ourselves to live in constant comparison with friends, family, colleagues and in the picture perfect life of Instagram and Facebook.
Constantly believing that everyone else has it better than us; is more successful than us and we will never achieve that level of success. Conscious Beyond Wealth was created to give everyone the tools to overcome these obstacles, take a realistic look at their individual situations and have a support system to understand they are not alone.
Everyone does this but I would venture that entrepreneurs fall victim to this harder than the rest of us. Not only are they comparing their personal life with everyone else but they are comparing their businesses as well. When we equate success with a purely monetary value it becomes a necessary evil.
It begins to rule our thoughts….
I just need to make $10,000.00 more a year and then I will be happy.
I am almost 40 and don’t have $100,000.00 in my retirement savings yet…I am never going to retire.
My line of credit has a balance of $60,000.00…I am never going to pay this off.
When will it get better?
The first step is we need to define wealth in our own terms and explore why we have these negative emotions surfacing around money.
We need to ask ourselves some hard questions…
How do you know $10,000.00 more a year will make you happy if you have no plan for what problems it will actually solve?
Are the problems you are facing solvable with money alone?
How do you know how much money you need in your RRSP if you have never thought about what you want retirement to look like?
Have you considered that value of your business as part of your retirement savings?
Lastly how do you know you will never pay off that line of credit if you don’t come to terms with why you are avoiding dealing with it.
How did you accumulate that debt?
Was it due to buying the entire city boxes of wine or were you expanding your business?
*Author's note: I have not in fact bought that much wine.....for the city*
You can see where I am going with this, and it needs to go deeper yet. We need to delve into your past…I know its scary, but you can do this.
Growing up what was your idea of success and wealth?
Who did you get it from?
Do you still have the same perception today?
Why did you want to become an entrepreneur?
Was it because you wanted to be your own boss?
Have more flexibility so that you could spend time with your family?
What does your ideal life look like right now?
How about in 10 years?
How often do you compare your situation to others?
Who are you comparing it to: friends, family or Facebook?
How does this comparison make you feel?
How does their life actually compete with your ideal life?
These, my friends, aren’t easy questions to answer but you need to explore, process and come to a understanding with them, especially if you are caught in the trap of comparison. Most often our feelings of shame and guilt come from comparing our situations to everyone else’s. However their situation is not your situation and their situation might not be realistic. Don’t worry, every one suffers from reality, that’s why Conscious Beyond Wealth is here…to be your support system...and offer you a glass of wine
*Author's note: not a real glass of wine, my husband tells me I can't*
When we were little our dreams didn’t have a monetary value. We wanted to be a marine biologist and live on a boat and scuba dive every day. We didn’t care what the salary was, we cared about the feeling we would have doing what we had always dreamt of doing.
You can have the life you want without a six figure salary but it takes discipline, hard work and planning. Anyone can take a trip to Hawaii if you plan for it, the issue is no one wants to wait and do the work to make it happen, it’s conditioned into us by the future we live in.
This is true for your business as well. It takes time, work and patience to build a successful business. You also have to stop comparing your business to everyone else’s.
At the end of the day if you are fulfilling the reasons that you became an entrepreneur aren’t you successful already? The only person who can tell you whether you are successful is you.
As an Entrepreneur where do you find yourself struggling with comparison? What is your idea of success?
Tell us in the comments section!