Did you know that most Americans live paycheck to paycheck? If you don’t have any savings to use in case of emergency, that’s scary, and chances are that’s how you’re living right now.
Today we’re going to talk about how to get away from living paycheck to paycheck and manage your finances.
Get Out Of Debt
Debt kills wealth, both personally and professionally. So you need to stop paying interest on things and stop using credit to fund your lifestyle. If you have to make minimum payments to somebody else, you’re making them money and not making you money. Right? So what you need to do is figure out a way to get out of debt.
You need to set up Profit First in your personal life.
Who would have thought that, right? You know about using Profit First in your business but you can also use it in your personal life. Use it to understand where you’re spending your money, both in your business and your personal life.
Now, your accounts are going to vary wildly. But you typically want to have an income account for day-to-day expenses, maybe an account for groceries, an account for gas and travel, and an account for big events like birthdays, Christmas, and that kind of thing.
You also want to set up an account where you’ll be saving money to pay off your debt. You’ll save for debt every quarter. Use the money in that special debt account to pay off your debt.
But the biggest thing you can do to help you modify and change your behavior is to reward yourself for all the hard work you do in your business and personal life to get yourself on the straight and narrow path of financial health. So take some time once a quarter to reward yourself and your family.
Make A Lifestyle Change
You may need to change how you live in order to save money and stop adding to your debt.
Sit down with your family and tell them that things are going to change and a budget will be put into place. That you are going to stick to this budget. Let your friends know you aren’t going to eat out as much anymore. And whether they like it or not, you’ve got to follow through. You’ve worked your tail off both in your business and your personal life to achieve financial freedom and the peace of mind that comes with it. When you have that peace of mind in your personal life, it will help your business.
When you have your personal finances under control, it’ll be easier to focus on your business and help it grow. As you nurture your business, those profits will continue to help you stay out of debt. So having a plan for both your business and personal finances is super important and super helpful.
I highly recommend that you set up Profit First in both your business and personal life. Using Profit First to manage your finances opens doors and brings clarity to your finances just like it does for your business finances.
I recommend reading Profit First by Mike Michalowicz. I am a Certified Profit First Professional and can assist you with implementation.
Join Money Made Simple Academy at curtisaccountingsolutions.com. Money Made Simple Academy is a series of simple on-demand courses, tools, and live coaching that wipes away financial overwhelm in your quilt shop and life!