MONEY. That little word can have such s BIG impact on our daily lives as coaches with a small business.
Bookkeeping. Budgeting. Recurring Revenue. Financial Stability.
If you’re anything like me, you’ve spent too many restless nights wondering how your business can make more money, and maybe even shedding tears of financial frustration here and there. But, what if the solution to stop stressing about finances wasn’t to make more money but to see it through a new lens?
In this first video of a two-part mini-series, I share two strategies you can use to stop stressing about money and instead celebrate your hard work and profits. Click the image below to watch the video… or keep reading for a transcript.
Can we talk about money? Money is the single, biggest stressor of a self-employed person…or at least it was for me.
Can we talk about money? Money is the single, biggest stressor of a self-employed person…or at least it was for me.
It was the thing I tried hardest to be responsible about and to do right by at the earliest stages of my business, but it was the thing that was hardest. No matter how hard I tried to put a bookkeeping system into place or be responsible financially, I felt like financial security was eluding me. It was always beyond reach, right? Come to me!
I spent, gosh, I can’t tell you how many times I’ve sobbed in the arms of my friends because it felt so stressful. And I’m pleased to say that I have not cried in, maybe, about five years about money at least. I still don’t feel like I have enough of it, and I’m still working to get my business to a place where I could pay for everything my business needs and pay for everything that my life needs, but I’m not crying and I do feel profitable.
So I am so excited to share two different videos with you. There’s this one where we’re going to talk about what are the two pieces of technology that I put into place that made me feel profitable regardless of how much money I made; and then check out the next video where I will look at things that I do with my time that make me feel profitable.
But for now, let’s look at the two things that were a total game changer for me. The first one was when I discovered this process called Profit First. (Google it if you don’t know–there’s a book. You can buy the book–I highly recommend it!)
The old way of thinking about money–and it’s a stressful way–is that you take your income, right, everything you make, you subtract your expenses, and then anything left over–if there’s anything left over–is your profit>
The Profit First way is that you take your income, you figure out a percentage–like, how profitable can I afford to be this year? and it started off as three percent; now I’m up to five percent–but you put five percent of your total income into a special account. That’s your Profit Account and then everything else gets budgeted. Now, there are rules in Profit First for how you budget everything else–I’m not going to be talking about that in this video because I’m really interested in telling you what I did with this profit money.
In the past, I never would have felt like I even had any profit. But now–because I was taking it off the top and putting it away and then accessing it only every quarter and forcing myself to buy things that made me feel profitable with that money–it was a game changer! At the end of this video, I’m going to share some of the things that I actually bought with that money…but I still want to tell you now about the second piece of software that I put into place that made a difference for me. That was YNAB: You Need a Budget (that’s what y n a b stands for).
Now you don’t necessarily have to use YNAB–any kind of budgeting software will do–but I’ll tell you why YNAB worked for me. I was constantly afraid because, as an academic coach, our income goes with the school year, right? So in September, that’s when I made the most money because I charge in packages and families often paid me in full. So I was taking in a lot of money, which you would think would be, “Yay!”
Funny, but instead, it was like, “Oh crap, that’s stressful! How do I make sure that this money lasts me through the lean times of the semester?” And then, in January, I take in more money at the new semester, right? But then it drops and almost goes to zero during the summer. I mean, it is sobering to notice you’re only taking in a hundred or two hundred dollars or sometimes none in the summertime as an educator. How do you plan in advance for that?
That’s where many of my tears came from. So with YNAB, I am able to save as I go, and it does bring me clarity and peace. So let me just give you an example. I need to spend about $600 a year on my business taxes for the city of Oakland. I just paid them today, so that’s why I’m thinking about it, and it actually turned out when I went in and did all the math that I owed $555 dollars. So I went into YNAB, and I was like, “Oh every month, I have been putting away–let’s see if I can do quick math; I didn’t do this before the video–so 600 um, oh gosh, I can’t do quick math, so can’t do it while I’m talking. Why can’t I do 600 divided by 12? Oh my God…this is ridiculous. This is ridiculous. Oh! I said 50 a month because YNAB has a little calculator that enables me to do the math, and I just do that every month towards my business taxes and, voila, there it was, and I felt so profitable, right?
It’s like, “Oh my God, I have more than enough. I don’t have to stress about it because I’ve been planning.” They don’t quite gamify it, but anyway, I’m just such a supporter of how YNAB works. It’s great for my brain, and my brain’s particular anxieties. And, I mean, it feels satisfying. At the end of the month there, it color codes things. So it’s like, “Oh, everything’s green! I’ve put aside all the money that I need each month to make sure that I’m paying my annual payments. It feels so good!”
So these are the two things. I highly recommend you look into them: Profit First and YNAB…but, now, what did I do with my profit money?
It was so fun every month–every quarter is when you’re supposed to go in and see how much money you have. And I would be thinking, like, “What’s something I crave that feels special?” And I would think about it, and think about it, and then, when the quarter came, the very first thing I bought was a Vitamix–you know, a top of the line blender (which I’m so grateful for right now because I’m recording this prior to my jaw surgery, but by the time you’re watching this, it might be after my jaw surgery, and I will be using this Vitamix like crazy to make myself all the soft food that I need while my jaw is healing!).
The second thing I bought was a trampoline, which, at the time, felt so luxurious and so ridiculous. It’s just something I desired. It was a top of the line exercise trampoline with bungees–I’m forgetting the brand name right now. If you know the brand name, if you know what I’m talking about, put it below, but it I think it costs $400 or something. I couldn’t believe I was spending that kind of money on a trampoline, but it brought me so much joy! Gosh! The feeling of jumping pain-free–because the bungees made my knees feel better–and then the air in my hair as I was jumping and feeling weightless…!
Sometimes, I would jump between each client, just as a way to shift the energy so it felt silly–but that’s exactly what made me feel profitable…because it felt luxurious. It wasn’t something I needed, but it brought joy to my life, and I was prioritizing spending my money on things that were joyful…whereas in the old way of bookkeeping, I wouldn’t even think that I had any money left over for joy.
Then the last thing is this couch, which I’m so excited for! My first grown-up couch ever: bought new, not used, or not free. It’s modular. It can go and transform to new houses as I move, if I move to new places. It’s comfortable. It’s smaller, lower to the ground, fit for my body. I’m so grateful for this couch, and I’m so grateful for the profit money that I set aside that enabled me to be able to buy this couch.
So I’m curious: what are you doing that makes you feel profitable? Why don’t you tell us below? Let’s have a little conversation: what are the things that you buy. or think you would buy, if you had some profit money set aside that would have you feel great about what you’re making–even if you’re still not making as much as you ultimately want to make? I’d love to hear it!
I’m sending you so much love into your business-building or into your dreaming about business-building if you are an educator thinking about transitioning into coaching or tutoring or something like that. Oh, and if you feel like you need more support–more behind the scenes views into what it takes to build a business–you can head on over here, where I actually have a lot more information about what it takes to build yourself a student coaching business, so feel free to check that out if you want.
Ah…I’m sending you so much love and wishing you much less stress with money as you set up the systems that you need.
Take care!
Bye, Everyone!
P.S.
Are you a parent–or a coach or educator–who’d like to offer your student with more executive function support?? If so, you’ll want to join me at The Executive Function Online Summit this summer!
I’ll be sharing The Power of Note-Taking to Improve Executive Functionon Day 2 — don’t miss it!
It’s all happening AUGUST 11-13, 2023, but sign up NOW to secure your spot! We all know how busy summer gets, and I’d hate for you to miss this. It truly is one of my favorite events of the year, and I love that I get to share it with you. Sign up here!