Written by Tope Ganiyah Fajingbesi, author of the book What Color is Your Money? Your Personalized Roadmap to Business Success
Do you aspire to be a successful entrepreneur some day? Are you an existing business owner experiencing challenges managing your business? Will you like to sustain the boom and growth your business is currently experiencing? Or perhaps you have run a venture or two in the past that did not quite turn out fine and you are wondering what you did wrong or could do better next time around? If any of these apply to you, you may actually need one or more of the lifestyle makeover tips I will be discussing in this article.
Tip #1: Understand Your Relationship With Money
This is a very important step, which requires complete honesty and careful thought. I advise you to analyse your behaviour and unique characteristics to understand what your strengths and weaknesses are when it comes to managing money. I once read that many rich people remain rich by behaving like the poor, while many poor people remain poor by behaving like the rich, and I think there is a lot of truth in that statement. You have to realize that a business venture is like another human being, and before you can help that other person succeed, you have to understand how to maximize your own strengths and manage your weaknesses first. A really great tool that can help you understand your relationship with money is the “Money Color Quiz” at http://ourfinancialcoach.com/money-color/. Your responses to 10 short questions will help place you in one of five color categories – Green, Blue, Yellow, Grey and Red. Green folks are the big investors in every economy; The Blues are the savers; The Yellows, the spenders; The Greys are the content: While the Reds are the debtors. Once your color is identified, you will receive advice on how to improve your relationship with money.
Tip #2: Understand Your Spouse/Partner’s Relationship With Money
Whether you like to admit this or not, your personal relationship with your spouse or significant other(s) has a big impact on your personal finance success or failure. It is therefore not surprising that money is one of the biggest causes of conflicts in marriages and similar relationships. My advice is that you understand your spouse or partner’s “money color” as well as yours so that you can know how to successfully manage your relationship in such a manner that it does not adversely affect your own financial success. Take for instance, Rose who runs a flower shop from her home. Rose’s money color is green, so she likes to invest her money, but her husband, Paul’s money color is Yellow, so he is quite a spender. Understanding this difference can help Rose a great deal. She may need to set up direct transfers from business checking account to the business savings account, so that when Paul comes down to the basement office to entice her with the new smart phone, which they could afford from the week’s sales, she is able to show him the checking account and let him know there are no free funds for that.
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Tip #3: Have a Clear Destination
You probably wouldn’t get in your car on a journey to nowhere, and you would most likely not leave your house without a map or GPS when driving to an unfamiliar destination. So why navigate this rather “unfamiliar” life without a good map? Why wake up every day embarking on a journey to nowhere? Every day you set out with no clear goals to work towards is a day you are getting in your car or a plane for a ride to nowhere. The most successful people establish simple, clear and measurable goals, and hold themselves accountable to those goals. Beyond establishing goals, it is also important to have a GPS, that is, a budget that clearly states how much you hope to earn and spend during specific times. Successfully practising this in your personal life, will surely translate to success in your business life.
Tip #4: Retail Therapy is Not the Solution
When next you want to resolve a stressful situation with retail therapy or want to buy yet another toy that your kids don’t need just so that they can let you have some breathing space, think about the song -“the best things in life are free” because it is very true. Spending money to drown life’s stressful situations has the exact same effect that using junk food to drown emotional issues has, it will make you over weight. The only thing retail therapy does is increase your problems because you get poorer and consequently add to the list of problems you were trying to resolve in the first instance. This tip may be hard to implement at first simply because of the “temporary rush of joy” you experience when you are spending money, but it is very important to reduce impulsive spending. When you achieve this in your personal life, you will surely be able to implement same for your business.
Tip #5: Always Pay Yourself First
You work hard, so you should learn to reward yourself, and what better reward can you give yourself than setting aside some of today’s funds for the rainy day? Saving simply means you see yourself as the number one person you have to take care of. However, your biggest barrier to maintaining a healthy savings balance is your own self; setting the funds aside is not half as difficult as leaving the funds “alone” to grow. You have to be disciplined, learn to prioritize, delay self-gratification and, most importantly, separate your wants from your needs in order to let your savings exist when you actually plan and need them.
So go ahead and use these tips to transform your life and your business. I am sure you, your associates and even your employees will be smiling to the bank in no time.
About the Author
Tope Ganiyah Fajingbesi is an international Chartered Accountant (ACA) and Certified Public Accountant (CPA) based in Washington, DC. She has 15 years’ accounting and financial management experience working with Big Four public accounting firms, Fortune 500 corporations, and nonprofit organizations across the USA and Africa. She obtained a Bachelors degree in Accounting from the University of Lagos, Nigeria, and a Masters in Business Administration from the Goizueta Business School of Emory University in Atlanta, Georgia. Fajingbesi co-founded and serves as the Volunteer Executive Director of United for Kids Foundation, and writes a finance column for Azizah Magazine.
The author is available for speaking engagements.
What Color is Your Money? can be purchased from www.amazon.com