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Business success is dependent on a solid financial foundation & success looks different to everyone & there is a lack of equity of access to resources and information for small business owners and independent contractors & there is a societal narrative making us believe “balance” is our ultimate goal & … There are so many “&”s that impact being your own boss. Let’s have some frank discussions on the basics of business with a holistic focus on everything that helps business owners define and find success.
Molly 0:08
Hello, hello. I am Molly Beyer, host of the Ambiguous &: Business Basics and Beyond, a podcast where we have frank discussions on the basics of business with a holistic focus on everything that helps business owners define and find success. There are so many ands that impact being your own boss. Join us as we explore all these ands and more. Like, subscribe, or follow wherever you get your podcasts, and let's explore these ambiguous ands.
0:38
Hello and welcome to the Ambiguous &: Business Basics and Beyond. I'm your host, Molly Beyer, and I'm here to lead you through frank and holistic conversations on the basics of business. And since again, we're getting ourselves into more of a mindset and gratitude space, I'm going to take another second to start us with an intention for the conversation today, because shifting our mindsets can push us into a space of reflection that highlights the gaps between where we are and where we want to be instead be here today, committing to reflecting with a gain mindset; seeing the positive progress you've made from where you were to where you are today. Deep breath. Here we go.
1:20
Today we're focusing on discipline as the key to financial success. Now discipline isn't about restriction, it's about creating habits and systems that lead to long term stability. And so our discussion is going to center on three major areas. We're going to talk about financial discipline and business fundamentals. We're going to look at the importance of financial routines, and we're going to start shifting from fear to control over finances. So again, remember, understanding leads to greater opportunity to grow and shift your mindset. So we're starting to start talking about financial discipline and business financials. Running a successful business requires financial discipline. End of sentence. That is an absolute requirement. You have to be financially disciplined, and you can't do that without full understanding of what it is you're doing.
2:16
So here's a few things that can mean. One of them is you need to understand the chart of accounts for your business and set up a structured system of accounting. So the chart of accounts are the categories that you put in your accounting software that you track your expenses to. So things like advertising, travel, rent, things like that- having that set up in a way that you can also use to manage your business is super, super important. If possible, get help setting that up for your business and for your personal. Because, again, I do recommend you keep your personal bookkeeping software as well, but particularly with your business, having your chart of accounts set up in a way that helps both maximize your tax preparation and maximize your ability to manage your business is incredibly important. You cannot manage or project with money if you don't know where that money is going. So setting those up very, very intentionally is key.
3:21
You also have to be regularly reviewing both your profit and loss or your income statement and your balance sheets. I recommend setting depending on your cash flows, a day a week or a day a month to be reviewing those. If you're handling your own accounting, you need to make sure that everything is reconciled and updated before you do this. If you have somebody that you're outsourcing it to find the time that they're done and your accounts are reconciled so that you can review them. It's also helpful if you go through them with that financial professional or your business partner or a business manager or somebody else that you trust with those financial items, because it's going to help you see things differently when you're looking at them through somebody else. You also want to look for places when you're going through these reports, that you can reduce expenses, but also opportunities to increase revenue. And this is a space that people miss when they're going through their financial reports. It's a lot easier to look at places to reduce expenses than it is to find ways to increase your revenues. And so be looking at those different revenue streams and where you can possibly increase those as well.
4:30
The last tip, create workflows and habits that make your financial tracking second nature. Use calendar tasks. Use to do lists, enter every expense, as it happens, be balancing and reconciling accounts regularly. A great one- just start thinking about your purchases before making them. Small habits, all those little things. But it also- discipline isn't about micromanaging every dollar though. It's not about thinking about it, I can't buy this thing because blah, blah, blah. It's just about consistency. It's starting to think about those little things you can do every day. If you're thinking about the money that you're spending, you might spend it differently. Instead of just like, I'm gonna go to Starbucks and get these things. And you're not really thinking about like, instead of, oh, instead of a $4 coffee, I could make that at home for, you know, for less, and it's going to taste good. And this and that, like you just start thinking about your money differently when you're thinking about it before you actually spend it. This is all about building habits, though. This is all about creating that space where you're doing the same little things building on them, day over day over day, until they become second nature. This can take time, though. It doesn't happen overnight.
5:49
There was a study in 2009 that found that it takes anywhere from 18 to 254 days to build a new habit. That can feel super daunting, but the average is about 66 so that's a couple of months. The key factor here, though, is that daily repetition. It's deciding those small steps you're going to take every day and then doing them every day. I'm thinking about everything I'm going to spend. As soon as I spend it, I'm immediately putting it into my check register or into my accounting software, whatever it is. I'm reconciling or balancing every month, and I'm reviewing those reports so that I know what's going on, I know what's coming in, what's going out, and I also know what my net worth or my equity is at any given time.
6:38
So some ways to build this financial discipline, again, is set up weekly or monthly financial check ins, and this is a great thing to do with an accountability partner or a group, whether that's your accountant or bookkeeper, monthly, whether it's sitting down with your partner or spouse, whether it's creating an accountability group with people that you trust. It's a way to make sure that you're going through it, that you're doing it, and they're at least checking in and saying, Hey, this is done. Again using financial software or simple spreadsheets to track income and expenses. This only works so if you keep them up, so setting that day, that time that you're going to do it, keeping track of each expense as they come through, these little things start to really build up. Automate savings or bill payments whenever possible, have money automatically transfer from your checking to your savings each month. Set up those automatic bill payments or set reminders for the days that things are due, so that you make sure that you're always going in and getting them, getting them done on time.
7:34
When you're creating these goals for yourself, too, you want to be really specific. So yeah, you can say, I'm going to do these little things for these habits, but unless you have a goal for the habit, you have an idea of who it is you want to be or what it is you want to see, it becomes a lot harder to to create those daily habits. So you want to be really specific on what those goals are, instead of saying things then, like, you know, I want to stay on top of my finances. Say I'm going to review my income statement every Monday at nine o'clock or the 10th of every month from 10 to 12 or whatever that is. Because the clearer your get on that goal, the easier it is to maintain and the easier it is to build those small habits to get to that space. Because our whole goal here is to shift from fear of money to being able to control our money. A lot of business owners, a lot of individuals, we avoid financial review out of fear. We're scared. But avoiding the numbers leads to financial chaos. So instead, we're really shifting our mindset. We want to view that financial tracking as empowerment and not stress. So again, this is where you get to grow as a business owner, to find better ways to do it, but bringing in others really helps it feel less daunting. We want to reframe setbacks as learning opportunities. Again, we're living in the game. We're not always going to make great decisions, but there is learning and growth in all of the decisions that we do make. We want to look for those patterns so we can start addressing the long term issues that are kind of holding us in this same space, and we want to build resilience by addressing financial weaknesses head on. This whole process of looking at this, this is not for the faint of heart, and it's going to be uncomfortable to start. Even our business decisions generally have some sort of emotional intention behind them. So when we stop and we look at our financials, it makes it easier for us to look at the decisions that we made. And we can then take the emotion out of it, and we can decide how we want to proceed. When we get there, they'll go that extra step of examining the emotion as well to see where that came from, so you can start working to change how you're responding to it in the future. And this isn't about judgment. Again. We're living in the game. We're living in the things that we're learning to do better, not in the things that we think we did wrong.
9:52
A practical exercise to do this is to really identify that one financial fear that's holding you back and reframe it as a growth opportunity. So if debt really scares you, shift from "I'll never get out of debt" to "I'm creating a debt payoff plan to take control". Don't live in fear. Live in control. I'm afraid of this thing, but this is what I'm going to do to overcome it. Because financial discipline is all about continuous growth. It's the mindset shifts, visualizing financial success and setting those clear goals. It's about an action shift. It's identifying habits to change and implementing daily financial routines to get to that change. And it's really creating that new you. It's the new habits that you're taking on until they become second nature.
10:39
Remember that gratitude is always a huge piece of this. And I like to look at gratitude in three pieces. So there's simple gratitude. Those are those things that you can just really easily have come to the top of your mind. You know, what things are you grateful for? I'm grateful for my business. I'm grateful for my employees. I'm grateful for the opportunity I have to even be my own boss. I'm grateful that I have enough money to pay my bills today. But beyond that simple gratitude, we have really intentional gratitude, and this is that space when we're looking at our financial records. These are our wins, these are our gains and our victories. And write them out when you're going through your financials. And take some time every day, at the end of each day, to talk about your talk to yourself about your victories for the day. That helps build those bigger habits as well, around money and around everything, all of our goals can benefit from this, and then we want that actionable gratitude as well. So that's where you are deciding what action you're going to take to create those future victories and gains and make a list of those while you're going through those financials as well.
11:45
So what we're going to do are four action steps. We're going to set a time this week to start going over our financials, and then we're going to decide where we're going to go from there. We're going to choose a financial habit to improve. We're going to write down one money belief that we want to change and we are going to practice gratitude in everything we do. We're living in the gain, not in the gap. With discipline and consistency, financial success is going to be inevitable.
12:14
Thank you so much for hanging out with us again today. We'd love to hear your feedback on this episode, as well as any requests for future content. Drop a comment or suggestion and join us next time for more frank and holistic conversations on the basics of business. Please also like, subscribe, or follow so you never miss an episode and until next time. I am Molly Beyer, and this has been the Ambiguous &: Business Basics and Beyond. Have a wonderful day.