Do you have credit card debt? Do you buy lottery tickets? When was the last time you read a book or went to a seminar to educate yourself on money matters? If you answered yes, yes and never to the previous questions, that is a pretty clear indicator that you lack respect for money and the power of money. Money can’t buy happiness, and I don’t want anyone to think that acquiring money should be your number one goal in life. However, as Suze Orman, best selling author of The Courage to Be Rich professes, “Choosing wealth as a goal requires facing everything about your money bravely, honestly, with courage – which is a very hard thing for most of us to do.”
Many of the small business owners I have coached are intimidated by money management and put their head in the sand the first minute they run into trouble. Here were the 6 top things from Orman’s book that will help you build the courage to respect money and thereby respecting yourself.
1. Research your options on every purchase. Make sure that new piece of equipment will actually pay for itself in a reasonable time-frame. Why buy the top-of-the-line equipment when a lower priced one will do? Unless you shop around, check other suppliers and other options, like leasing, or you may be paying too much. Set a company policy that three bids need to be collected before a purchase is made over a certain dollar amount.
2. Educate yourself on monetary issues. I’ve heard many people admit that they don’t understand their insurance policy, telephone contracts or legal documents. Admitting you don’t understand is the first step, but be sure to take the next step and learn about what you don’t know. Be brave and remember that no question is a dumb question. If your banker, financial advisor, insurance agent or accountant makes you feel stupid, find one that has more respect for you and will teach you what you need to know.
3. Save money for slow times, for tax times, for retirement, for unexpected happenings in your life. We all know the business climate can change in a hurry. It is not a bad idea to squirrel away some money for a rainy day.
4. Plan, plan and re-plan. When something changes in your business or your personal life, rework your budget and do projections for the next year. The sooner you realize a shortfall, the longer time you have to fix the problem.
5. Energize your sales. Money won’t just come to you, you need to get assertive and lead it to you. Be proactive. Set a marketing and advertising plan and stick to it.
6. Control spending. Ask yourself if you want a new piece of equipment or if you really need it. Be honest with yourself and only buy things you really need.
Make it your summer’s goal to follow these six steps to help you save thousands of dollars.