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  • Writer's pictureJacob Curtis

The Steps to Mastering Finances for Quilt & Craft Shop Owners

Did you know you have a conjoined twin? It’s your quilt and craft shop. And your personal financial health is in lockstep with the financial health of your business. Separating yourself from it must be done with surgical precision. And even if it is done successfully, you will always share a soul. Your behaviors with your personal finances are carried over to your business finances. If your personal finances are a disaster, your business finances will also be a disaster. This is why it is so important to have your personal finances under control.

Do not spend more than you make

A major goal of your business is to provide you, the owner, with financial freedom. To reach this goal, your business needs to pay you and generate a profit. To help you accomplish those goals, you use the Profit First cash management system. However, the cash management principles of Profit First also directly relate to your personal finances.

The bottom line of personal and business finance: Do not spend more than you make.

That seems easy enough, but most Americans struggle with this. You can go online and find statics like 7 in 10 Americans have financial concerns about the next 12 months. Their first worry is having to go into debt or more debt to cover necessities, followed by paying higher interest on their debt.

How to avoid financial disaster

The question for quilt and craft shop owners is, “How can I avoid financial ruin and piece together financial freedom knowing that I am joined at the hip with my business?” I am going to steal from Dave Ramsey, host of the Ramsey Show and author of Total Money Makeover, and Mike Michalowicz, a business expert, speaker, and author of Profit First, to answer this question.

To avoid personal and business financial disasters, you need a plan. In the Bible, it says, “Suppose one of you wants to build a tower. Won’t you first sit down and estimate the cost to see if you have enough money to complete it?” (Luke 14:28-30 (NIV)). So, before we can even start something, we need to have a plan. Here is the plan for avoiding financial ruin and piecing together financial freedom in your personal life.

Step 1 - Stop using debt

The very first step is to stop accruing debt. Stop using credit cards. You can’t borrow your way out of debt. That’s like saying 1 minus 1 is 2. No matter how much we want that to be true, it just is not the case.

My mom once told me that there are two kinds of people in the world: those who pay interest and those who earn interest. And we choose which one we will be. We must stop paying interest and start earning it to avoid financial ruin and piece together financial freedom.

Step 2 - Balance ambition and contentment

The second step is realizing that “wealth gained hastily will dwindle, but whoever gathers little by little will increase it.” (Prov. 13:11) This means that you have to be realistic and patient when working your plan. Every overnight success was years in the making. With this comes contentment. Finding that balance between ambition and contentment leads to lasting success.

Step 3 - Save $1,000

Next, save $1,000. This amount is enough to cover some small emergencies, but more importantly, it gives you an achievable target and a quick win! Managing money is 80 percent behavior and 20 percent math. If this were not true, we would not be concerned about money because we would all live on less than we make. But that is not reality.

Step 4 - Pay off your debt aggressively

Once you have saved $1,000 for an emergency, you pay off your debt aggressively. The Bible says this about getting out of debt, “Give no sleep to your eyes, nor slumber to your eyelids. Deliver yourself like a gazelle from the hand of the hunter, and like a bird from the hand of the fowler” (Proverbs 6:4–5).

In other words, do everything you can to get out of debt. To do this, you need to change your spending habits and find that extra money. Sometimes, that means delivering pizzas and selling stuff you don’t need to bring in extra cash. As Dave Ramsey likes to say, you sell so much stuff that your kids think they are next.

So, you make all the minimum payments on your debts but pay off your smallest debt first with the extra money you earn. Once that smallest debt is paid off, you take the money you were paying and add it on as extra payments on your next debit. This is called the snowball method. You keep growing your snowball of debt payments until you have paid off all your debt!

Step 5 - Build a true emergency fund

Once you have paid off all your debt, except your mortgage, you now build up that emergency fund for 3 to 6 months' worth of expenses. Again, the Bible says, “Precious treasure and oil are in a wise man's dwelling” (Prov. 21:20). This will protect you against life’s bigger surprises, like the loss of a job or your car breaking down, without slipping back into debt.

Step 6 - Regularly investing and saving for retirement

Once you have your fully funded emergency fund in place, you shift your focus off debt and what-ifs and start looking up the road. This is where you begin regularly investing and saving for retirement. Because if you're still working at 67, it should be because you want to, not because you have to. “A good man (or woman) leaves an inheritance to his children’s children” (Prov. 12:33), the Bible says.

Step 7 - Save for kids’ college education

If you still have kids at home, now you start saving for their college education. If you do not have kids at home, then you can skip this step. 

Step 8 - Pay off your mortgage early

Next, you pay off your mortgage early. Your mortgage is the only thing between you and complete freedom from debt. Can you imagine your life with no mortgage payment?

Step 9 - Give like no one else

And finally, what could you do if you had no debt payments? Anything! This is financial freedom. The last step is the most fun. You can live and give like no one else. Find out your current net worth, then keep building wealth and become outrageously generous while leaving an inheritance for your kids and their kids. Now that's a legacy!

Next Steps

Again, the way you handle your personal finances directly impacts how you handle your business finances. You are joined at the hip with your quilt and craft shop. You clean up your personal finances, and you’ll clean up your business finances.

On April 10th, I am hosting a webinar further explaining the what, why, and how of the Profit First system. I would love to see you there, so please go to to reserve your spot.


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