5 Basic Financial Principles
These basic principles work well for your business or personal life. If you cannot balance your personal check book you will not balance your business checkbook. Be mindful of money and do good math. Your business cannot operate without cash. It is the blood line of your business.
- Spend less than you make- When I think about this I want it to mean make more than you spend, so I set out to earn more. But the more you earn the more you spend, so it doesn’t work. I still have to spend less than I make. Can you see the difference?
- Tithing- I believe in giving 10% of my earnings back to God, my community and those less fortunate than me.
- Savings plan-One way to spend less than you make is with a savings plan. I have 2, one for business and one for personal savings. I put 10% of my income in each.
- Balance your checkbook- When I spend money using my checks or bank card I try to take time right at the register to balance my checkbook. I put my bank card in my checkbook so that it is convenient for me to remember to do so. Don’t rely on your statement because it is often behind and can cause you to go into overdraft.
- Keep a daily ledger- You can use Microsoft excel, Quick books or a ledger book to maintain records of your business income and expenses.
This one is for free!
6. Plan your work and work your plan- Sometimes things that look like opportunities when they are actually distractions. Create a plan that works. If it doesn’t work keep changing it until it does, and then work it. Don’t waver, don’t doubt, just work and pray.