When I work with creative business owners, they tell me that freedom and flexibility are the top reasons they’ve decided to go into business for themselves. But they’re living in such a feast and famine cycle that they aren’t able to enjoy a flexible schedule or prioritize the things that are most important to them.
The thing that’s keeping them stuck in that cycle and preventing them from having what they truly desire is money.
I’m guessing you can relate. Maybe you’ve found:
- That your money fluctuates and you’re always living in feast or famine,
- You make good money, but you don’t have anything to show for it,
- Your expenses have gotten over your head,
- Or, your relationship with money overwhelms you as you try to figure out how to pay yourself consistently, save for taxes, and create the financial security you desire and deserve.
In order to start creating the freedom and flexibility you desire follow these three steps.
3 STEPS TO FREEDOM AND FLEXIBILITY
First, get clear on your personal expenses.
Let’s be honest, your business should serve you because you make good money. But right now, you pay your personal bills here and there and you’re not really sure if you can even afford to pay yourself. Or even how much you need to pay yourself. So, let’s figure out exactly what you need to live on!
Clarity comes in knowing exactly how much you need for bills and other expenses you need to pay from month to month.
Take Action: Download this free template or grab a pen and paper.
To help you gain some quick insight, look at your bank account statement from last month. Write down your non-negotiable expenses first. This means things like saving for personal emergencies (you can debate this but I believe part of staying out of the overwhelm is including a line item for savings even if it’s $25 a month), mortgage payments, utilities, gas, car payments, and any of the other bills that are essential for you to live.
Now, add in your negotiable expenses such as groceries, dining out, manicures, and travel. Then, calculate the total.
This is the amount of money you need to pay yourself each month to live comfortably.
Second, get clear on your business expenses.
You might be thinking that all of your money goes to expenses and that might be the case right now. Similar to your personal expenses, I want you to take a moment to write down all of your business expenses so you know exactly how much you spend on your business. This means that you have to go beyond a simple answer like ‘a lot’ because using a figure like ‘a lot’ will not help you gain clarity on how much you’re spending or where you could reduce your expenses.
As business owners we have a tendency to invest in all of the things regardless of whether they currently serve our personal or business goals. Getting clear on why your expenses have gotten over your head or intentionally looking for opportunities to reduce or cut out expenses altogether will create more freedom. When you leverage how you’re spending your money within your business, you’ll be able to use that money to focus on other priorities like saving for a business investment or freeing up money to pay down debt.
Take Action: Similar to your personal finances I want you to capture all of your expenses, but this time it is for the intention of deciding if your expenses align with creating the freedom and flexibility you desire.
Sure, we could dig deeper but I want this simple exercise to focus on whether this expense is serving you or if you want to cut this expense so you can use that money towards paying yourself, saving for an investment, or freeing up money to pay down debt.
Use this template or grab a pen and paper. Start by capturing your annual expenses.
Find your old bank account statements or check your accounting software and write down the expenses you’ve only paid for once in the last year and which you’ll most likely pay for again a year from now. A few of the most common expenses are websites, CRMs, Google Suites, branding photography, and professional memberships or license renewals.
Now, do the same with your monthly expenses. These expenses may be expenses like client gifts, marketing, subscriptions and contract work. Once all of your expenses are in one place go through and audit your expenses. Put each expense into one of three categories (1) continue using, (2) check back in a month, (3) cancel and put towards another goal.
Third, schedule weekly money dates with yourself.
A money date is just like it sounds: setting aside the time to date or manage your money.
The goal with a money date is for you to start and continue to build confidence and clarity with your money. Money dates can help you create consistency in your finances even amongst varying expenses, shift your mindset about money, help you save for taxes, be proactive in how you spend your money day to day, pay down debt, save more consistently and help you monitor your progress towards your goals.
Take Action: This week, I invite you to start having a weekly money date.
Carve out 30 minutes to have a money date with yourself and start gaining clarity on one small piece of your financial journey. Don’t feel the need to take on an overwhelming task. Start small.
Starting small may look like writing all the due dates for your bills on a calendar, asking your accountant how to prepare for tax season, or going through your business expenses and canceling the things that are no longer serving you. These small steps will lead to increased clarity and confidence when you continue to show up for your money dates each week.
The Real Reason You’re Not Experiencing More Freedom and Flexibility Right Now
If what you really crave is freedom and flexibility in your business, take a moment to take action with just one of these steps.
You do not have to tackle it all right now. Whether it’s getting clear on your personal expenses so you’re able to make better decisions about where you spend your money in your business or getting clear on your business expenses so your spending aligns with the things that help you serve your clients and invest in yourself.
The freedom and flexibility you desire will come from having a clear understanding of how your money is serving you and helping you build the life you desire.
Ready to reframe your thoughts on money? Get our Money Mindset Guide.