Apr 5, 2019
According to the Small Business Association, 80% of businesses in the USA are 1 paycheck away from going under.
Also from the Small Business Association, 80% of businesses won't make it to the 10-year mark!
It's time to bulletproof your finances and bulletproof your business! Make your business the 20% that makes it past 10 years! Here's How:
1. Freezer vs. Table Mentality. Don't eat everything that you kill. Always keep some in the freezer! Here's what I mean..
Your business is making money and paying the bills, but what if a catastrophe happens that hurts your revenue and you don't have enough put away to deal with it? Don't let yourself be in that position. Have at least 3 months of your business' income put away and never touch it! This way if something happens, you're prepared for it and you'll have at least 3 months to get some more revenue flowing into the business.
2. Be averse to having debt!
Don't let yourself get into debt. If you don't have the cash, don't buy it! And if you're in debt, work towards paying it off. Don't let debtors be in control of your finances!
3. The 30-30-30 Rule
After you've paid the bills and all the expenses in your business and you have at least 3 months of expenses put away, what do you do with the profitability? Here is a rule that will ensure that you never get behind.
- Take home 30%
- 30% goes to any other debt you have
- The rest gets held in the account
These are 3 steps to bulletproofing your finances! When your business is running smoothly and you're not worried about not having enough to pay the expenses you'll have HAPPIER CLIENTS, BETTER RESULTS, MAKE MORE MONEY, AND ENJOY THE RIDE!