Let’s dive into the very important topic of money, money, money!! Please don’t run away from your computer or whatever device you are reading this on. I know that money can be a scary and intimidating topic. BUT, as women, entrepreneurs and household leads, it’s important that we discuss it. And, not only talk about it, but really understand money, celebrate it and become savvy with it.
You have already made such a brave leap into entrepreneurship. Some of you have uprooted your entire life and sense of normalcy and stability to really go after what you want in life. You are the CEO of your very own business and that is AMAZING. In order to feel completely confident in your new position, you need to understand the finances.
Alright, yes. Math can suck. But, just because you are not a “numbers person” doesn’t mean that you can’t be aware and in charge of your money.
“WE ARE ALL CHAMPIONED TO BE THE CEO OF OUR BUSINESS AND OUR LIFE, BUT NOBODY IS TELLING US THAT WE NEED TO BE THE CFO.” – AINE ROCK BASED ON TEACHINGS FROM JAMIE TRULL
You are the CEO and your creativity comes naturally. You have such a big, beautiful vision for your business and the future is bright. However, our mindset needs more than just the big vision; you need the understanding of data. As the CFO, you understand where the ship is heading. You’re aware of your profits and losses, and can therefore change course.
If we are being honest, a lot of us are just “winging it”. We have an amazing, creative idea to earn a living and it’s working. It could be working even better and profiting us even more if we understand the numbers. The numbers can serve as checkpoints for the growth of our small businesses. Shifting from the “winging it” mindset, we can actually learn and grow our businesses on the foundation of financial literacy.
“IF YOU ARE NOT REALLY SITTING DOWN TO LOOK AT THE NUMBERS, YOU REALLY DON’T EVEN KNOW THAT THERE IS A PROBLEM THERE” – AINE ROCK
As women entrepreneurs, let’s strive to gain financial literacy around accounting, finances, and taxes. It can be so beneficial to have even a general understanding of a PNO. Look at a PNO and consider what type of data you could be tracking; not only for taxes, but to make decisions as management.
AN EXPERIMENT: QUARTERLY MEETINGS WITH YOURSELF
On a quarterly basis, have a conversation with yourself – between the CEO and CFO.
Put on your CEO hat. Talk about all of the big dreams and visions.
Put on your CFO hat. Consider which parts of the dream are currently feasible. Discuss what is actually achievable by the numbers.
YOUR TOOLBOX: BECOME FINANCIALLY LITERATE
Finances are usually just viewed as compliance. We do our taxes because we don’t want to go to jail and that’s as far as we take our finances. But, not anymore! Finances are so much more than that. An understanding of finances can answer the following…
- When should you bring on a new product/service?
- How much should you charge for that product/service?
- How much should you pay your employees?
- How much should you pay yourself?
- How much should you reinvest into your business and on what?
I know that you are busy running a business, but let’s look to shift away from outsourcing the financial responsibilities. At the end of the day, you are the best person to make these decisions. No one will ever know your business as well as you do, especially once you grasp the financial side. You can still have the support of a team around you.
Ask yourself, “What information would be helpful from a numbers perspective in making decisions in my business?” Then work with a bookkeeper or someone similar to make a system. Figure out what it is you and your business need.
Listen and learn more as I chat with Jamie Trull on the Rock Your Joy Podcast. Jamie is a CEO/CFO of her own business and is committed to helping women entrepreneurs go from surviving to thriving.