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How Much Should You Invest in Your Business?
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How Much Should You Invest in Your Business?

Small Business, solopreneurs

How Much Should You Invest in Your Business?

When you’re feeling ready to invest in yourself or your business, the next decision to make is, “How much do I spend?” This is different for everyone, but the key is to think about how the investment will pay off. How soon can you expect a return on purchasing equipment, or more education?

Below, I have mapped out some questions for you to think through when getting ready to make an investment in a couple different categories. Having clear answers to these questions can help you make a decision on what amount will be a sound investment for your future and the future of your business.

Buying equipment or supplies – With this one, ask yourself, how much extra are you going to make or save by buying that piece of equipment? Or, are there other ways this equipment or supplies will reduce costs or increase profits? Really sit down and do the math – quantify what your situation is now without the thing you want to purchase, and estimate what things would be like once you’ve made the investment.

Hiring an employee – Whether you’re considering hiring a VA or another type of employee, figure out how much of your time a task you’re going to turn over to them is absorbing for you. Try calculating your hourly wage, and considering what other things you could be doing with that time that may bring your business more profit. Weigh this against what it will cost to hire them, get them trained, get them on payroll and provide them their legal benefits. Plus include the cost of bonuses or whatever else you might want to factor in so you can be a kind and generous employer.

Coaching or further education – This may be the least cut-and-dry category when it comes to calculating possible payoff. However, as someone who has personally benefitted tremendously from investing in business coaching and further education from people like Karen McCall and Kadijdja Yansane, I highly recommend making this type of investment after careful consideration. Vet the training or coaching out. What kind of results have people who’ve gone through the program achieved? Also, check in with yourself about what your goals are for this new education or coaching engagement. Working through mindset blocks or knowledge gaps can be huge for your business. This can enable you to grow quickly and make the moves you want to make. However, make sure you have some clear goals you can name, and that you aren’t attracted to these programs purely because of impostor syndrome.

I hope these questions help you think through your potential investment. If you would like some assistance, I’m happy to join you for a free Financial Self Care Consultation, where we can discuss what you’re seeking and find out if working together might be a good fit.

Angela

Image: Iris Wang

By Angela Keller|2021-07-13T12:11:50-07:00July 13th, 2021|Categories: Small Business, solopreneurs|Tags: how much to invest in a business, invest in your business, invest in yourself, investing in your business|0 Comments

When Is the Right Time to Invest In Your Dreams?

Whether you’re wanting to quit your day job and go full time in your business, invest in some equipment to level up your production, or get a higher level of education in your field, all of us face choices about when to invest in our dreams. Let’s talk about how to make these decisions from a financial perspective.

Consider Your Timing

First, establish a timeline for yourself on making this investment. By when would you like to start your training, hire an employee, etc? Now, think realistically about other events and expenses that may come up around that time. For example, making a large equipment purchase around the holiday season may prove to be financially stressful. By analyzing your timeline and any upcoming expenses, you can plan to have the funds and energy on hand to take this new leap.

Establish a Savings Cushion

Especially because these decisions are typically financially loaded, it’s important to already have, or begin to cultivate, a multi-layered savings cushion. Ideally, you have a savings cushion to cover periodic expenses, and another to cover income-loss emergencies, typically an amount to cover 3-12 months of your expenses saved up. You can read more about establishing a savings cushion in my article “How to Plan for Surprise Expenses“. Take a look at these ideas and then make a plan to establish a savings cushion before taking your big step.

Tune Up Your Money System

This is a good idea whenever you’re making any financial decision. Take a look at your income and expenses and see how things are going with your savings. Making a regular habit of doing this is immensely helpful and can simplify financial decisions like this one. My e-Book 9 Secrets to Financial Self Care has a lot of great insights on how to establish a habit of checking in with your money.

If you have yet to set up a money system, you might like to check out my articles on money-mapping. “The 4 Components of a Restorative Money System” is a great place to start.

I hope these suggestions are helpful and that your decisions making process is a peaceful one!

Angela

By Angela Keller|2021-07-08T11:08:48-07:00July 8th, 2021|Categories: Financial Clarity, Small Business, solopreneurs|Tags: consider timing, financial decisions making, financial timing, investing in your business, investing in yourself, money system, savings cushion|0 Comments

All About Oversaving, And Why Overcoming It Can Strengthen Your Business

Often issues with money stem from not having enough – so when you hear the word “oversaving,” it might not sound bad. However, oversaving can be a serious issue that may be blocking the potential of your business. It may also point to anxieties that need to be resolved. Let’s take a look at what oversaving is and what you can do to overcome it.

What Is It?

If you experience anxiety or guilt over spending money, even on basic necessities, you may have oversaving tendencies. You might struggle to spend money on your business or operating expenses. Alternatively, it might be hard for you to spend on something other than reinvesting in your business. Or, you might have a hard time parting with any money know you could save it for retirement or business emergencies.

Oversaving both stems from and enhances anxiety, stress, and burnout. It often comes from a fear of scarcity. While saving money is an important skill, if it’s taken to an extreme, it can keep you from spending money to solve urgent problems in your business and your personal life.

What Can You Do About It?

Saving money is a great habit, but the key to overcoming the oversaving habit is to get strategic about your saving. Rather than living in this panicked feeling of “I have to save every dime I possibly can,” create some money systems! Coming up with savings goals, establishing a spending plan, and automating your money are all great ways to introduce strategy and systems.

Savings goals can be especially helpful, because they can lend purpose to all that saving, but they also create an end point you’ll eventually meet. Limiting and directing your savings in this way can help curb the habit and assuage your anxieties. When you use the Profit First system, you put aside money to pay yourself first, but you also save for taxes, put aside money for operating expenses, and also distribute profits every quarter, which are meant to be spent by YOU so you can reward yourself for your hard work. If you’re interested in learning more about the Profit First System, check out the first 5 chapters of the book here.

Doing some emotional work around money can also really help you clear up your oversaving. I recommend reading Bari Tessler’s The Art of Money for more ideas about this. She helps you unpack your feelings around money and combining the practical with the emotional. If you’re interested, check out my book review.

Oversaving can be a sneaky habit, difficult to catch and overcome, but I believe in you – you can do it! And anyway, saving is so much more effective when it’s done in order to meet a goal. If you enjoyed this article, I suggest looking into Profit First. If you want to chat more about these ideas and take a look at your money, you can take a look at my service packages and book a call. Doing a year-end review could help you identify a couple goals to save for!

Angela

Photo by Sharon McCutcheon

By Angela Keller|2022-01-12T10:57:45-08:00December 19th, 2019|Categories: Personal Savings, Personal Spending, Profit First|Tags: anxiety, automation, business spending, emotions, finances and emotions, investing in your business, long term savings, money and emotions, money work, psychology of money, saving, savings goals, spending plan, stress levels, when to take the leap|0 Comments