When talking about a financial plan, I want to be clear with what kind of plan I’m talking about. I’m not talking about saving for your retirement or your children’s education. Instead, I’m talking about the financial plan of your business. This includes your business plan, your finances, the longevity of your business, and maybe a little bit of your retirement.
I always say there are two types of people in this world: the ones who tell their money where to go and the ones who wonder where it went. For a long time, I was the latter. When it came to the end of the month, I often had no idea where my money went and was stressed about paying bills. I worked hard to unlearn my habits and create new ones. I worked hard because I knew that I wanted better for my girls and me. I knew I had to end the chaos and stress that my numbers caused me.
That’s why I have a money management plan. My money management plan is part of my financial plan because it allows me to decide where I want my money to go and holds me accountable to ensure the money is going there. An effective financial plan begins with closely examining your values, wants, and goals.
If a money management plan is part of your financial plan, make sure it’s clear and precise so you know where you should be putting your money. It can help you understand how much money you need for your expenses and how much you can allocate to reach your goals (knowing your cash flow is crucial in creating your money management plan).
I want to challenge you to sit down and explore what your values and goals are within your business. Assess those with your cash flow and then create a financial plan to determine how much money you need to reach those goals (and yes, one of your goals can be geared to your retirement). Then, with all that information, you can create a money management plan to pave the way for you to reach your end goals.
When you use these three things together – your values/goals, your financial plan, and your money management plan – it’s only a matter of time until you have sassy and sexy numbers.
