Are you financially fit with Tracey Bissett - Christine Means Business (2024)

For a long time, money was a really weird topic for me. I’ve never talked about it, never considered it, everything was on autopilot. Before becoming an entrepreneur, I had a paycheck, and never (luckily) worried about it. I always lived in a perception that I'm not good with money because whenever I had it I would spend it, which to me meant “I can't handle a lot of it, because I would just waste it.” That changed when I became an entrepreneur.

Working with a financial coach

One of the most important changes I made is that I worked with a financial coach. She sat me down and we went through all my expenses that are needed to make a living – personal, as well as professional, throughout the year. Once I started to control that, it changed everything. I'm really excited to have had the chance to sit down and talk about money with Tracey Bissett.

As a Chief Financial Fitness Trainer, Tracey educates and empowers individuals, notably young adults, and entrepreneurs to take control of and live their financial lives with confidence.

From a very young age, Tracey learned that money was something that we should respect, learn how to use and put some practices around it. When it comes to entrepreneurs and business owners, one of the main struggles that can be avoided is not taking accountability for the financial side of the business. This shows up in one of two ways:

1. You hire the accountant or the bookkeeper, you let them go crazy and you don't even monitor anything that they're doing;
2. You bury your head in the sand and as long as you are making money, you have no worries.

In the first case you have to step up and take responsibility. If you don't have any knowledge about that area, which is absolutely normal, take the time to learn – you're the CEO, you've got to learn it.

In the second case, you can do this anytime but especially at the beginning, validate your idea. You have to make sure that what you're offering, and the people you want to offer to, will pay the amount of money that you need. If you don't do any research, if you don't actually run the numbers to make sure you can make money off of the price you want to charge, you're going to end up wasting a lot of time and money.

Sometimes, a good outcome of a business plan is doing the work, and figuring out that this is not a viable business. So, before you put your life savings into it, before you quit your job, before you do all that kind of stuff make sure it has a good chance of working.

The Business Plan

Creating a business plan might sound overwhelming and Tracey’s advice is to think of it as a story that highlights how you're going to cover every area in your business and how you plan to do it. In Canada, there is a Business Development Bank of Canada, which is the bank for entrepreneurs and they have a free business plan template that you can download and fill in. It's a step-by-step plan that walks you through what you need to do and it prompts you with questions. A good business plan is definitely worth your time because it will save you a lot of time and a lot of money.

Setting the right price

The next big struggle for entrepreneurs is pricing. In working with entrepreneurs, the one consistent thing Tracey hears is “I'm not getting a steady paycheck.”

85% of the time, the culprit is pricing. When you don't look at your numbers, and you just kind of do it in your head, and you set your sales price thinking that all the expenses will be covered, you inevitably miss some and you're actually losing money on every single thing you do.

An easy way to look into it, if you're not sure if you're making enough money, is to ask yourself “If you had to pay somebody else to do what you do, would you make money after that?”. Most people aren't factoring in their own time.

You can try out this very simple one-week course called “The Money Mindset Journaling Journey”, which will help you get rid of those mindset saboteurs around pricing.

Profit and Cashflow

Another extremely important thing for any entrepreneur or a business owner is to know the difference between profit and cash flow.

Our income statement that shows us all our sales and our expenses, is based on accounting rules. So, if we are booking a client, we're going to charge them and that will show in our sales, but they might pay us over 12 months. So, we're only going to get the cash-in every single month, so we're recording the sales, but we're not going to see that cash coming in.

There is this big disconnect. You recorded the sales on your income statement, you look really profitable, but the fuel and the lifeblood of your business is the cash. If no cash comes in and you don't have access to credit or you don't have cash reserves, your businesses will go under.

When you think about cash flow, think about the journey of your customer:

• they're gonna come and work with you
• sign the agreement

You do your service. When is it that the money is going to come? When do they pay you? Follow that cycle all the way through. If it's not for 30-60-90 days, what's your plan to cover those expenses during that time?

Look out six months in the future. This strategy highlights all of the potential problems you might face where there's not going to be enough cash, and then by having lead time, you're able to come up with so many different solutions. The frequency of it is going to depend on how tight your cash flow is.

Normally you do it on a monthly basis. If you've got tighter cash flow you do it weekly, and if it's really tight you do it daily for a while, and that's just how you become successful. Once you've got that running and you're always keeping it up to date, within minutes, you can actually use numbers to help you make decisions, which is the ultimate empowerment and how you get the confidence to make those calls in your business.

If you are ready to face this beast and make peace with money, reach out to Tracey Bissett. She will provide you with honest feedback, call you out if you've got some beliefs that are not really accurate, and get straight to the facts. You can get started today, with a free Money Meeting Agenda.If you have any questions or comments, feel free to reach out to Tracey on LinkedIn.