For an entrepreneur to be successful in building a business you have to be skillful in different areas of business. One of these areas is managing money. Proper money management puts you in the driver seat for directing how money flows through your business. It also positions you to have a profitable business and sustainable business.
Here are 10 more things you should know about managing your money:
- Your relationship with money and what you think about money drives how you manage your money.
- Managing your money doesn’t have to be a complex process in your business. Keep it simple! The best money management process is the one you will be consistent in doing. If you make managing your money a difficult task, you won’t dedicate time for getting it done.
- Money loves attention! When you are tracking its inflow & outflow and managing it on a regular basis you’ll start to see the cash in your bank account increase.
- Personal and business finances should be kept separate. Any business related transactions should be done with a business bank account or business debit/credit card.
- Forecasting and managing cash flow should be an integral part of managing your money. A business needs positive cash flow in order to be sustainable. Without cash or money your business will not last.
- The numbers in your business tell a story. When you know the numbers you learn how the money works in your business. You are then in control of your money so that it works for you and not you for it!
- Have a financial abundance plan (budget) that is based upon your greater purpose and top goals. This is to ensure proper allocation of where to spend your money and how to earn it. You’re more apt to follow it when you know that it’s aligned with your vision.
- Any decision that you make in business will have an impact to your bottom line. Proper and consistent money management aids in helping you make efficient business decisions that will ensure your future cash flow.
- There are four key financial documents that every entrepreneur should know for managing money: the balance sheet, income statement, cash flow statement, and the financial abundance plan (budget).
- Organization is an important element of managing your money. This includes keeping accurate records of your finances, filing all necessary documentation such as receipts, mileage records, etc. and a frequent money tracking process.
One Simple Money Management Action Tip
This week choose one money management action to integrate into your business or life.
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