Don’t Let Impostor Syndrome Fuel Overspending In Your Business

Here are three tips to help you curb overspending or impostor-syndrome-based emotional spending in your business:

Create Financial Clarity

Oftentimes, an unclear financial situation in your business can contribute to your feelings of impostor syndrome. Whether you’re unclear on whether your business is actually profitable or accidentally underpaying yourself, financial murkiness can lead to several issues that leave you feeling “not good enough.”

The antidote to this is to build a restorative money system for your business and make a habit of checking in with your finances regularly. The more you know about your business’s finances and take action to influence them positively, the more confident you’ll feel about your business overall. This tip also has the added bonus of bringing you more awareness around what types of spending decisions you can or can’t currently afford to make, thus curbing the potential for overspending even further.

Take Stock of Your Goals Before Making a Spending Decision

If you want to make spending decisions from a calm and confident place, it’s important to give yourself a chance to step out of the emotions that impostor syndrome might bring up. This means checking in with your goals for your business and your values for your life. Ask yourself, “Will this investment bring more of what I want for my life and my business?”.

Sometimes your main interest in making an investment can be traced back to simply feeling “not good enough.” Reconnecting with your goals and vision for your business can help you release this mindset and instead consider whether a particular spending decision fits well into your overall business plan.

Weigh the Costs and Benefits

I encourage my clients to consider the question, “Will this investment help me make more money?” This is a question that can often easily be answered with some math. I highly recommend reading my article “How Much Should You Invest in Your Business?” which goes into detail on how to weigh the costs and benefits of purchasing equipment or supplies, hiring an employee, and getting coaching or further training.

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By |2023-07-28T15:53:37-07:00July 28th, 2023|Categories: Money Mindset, Profit First, Small Business|Tags: , , , , , , |0 Comments
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Why You Don’t Need to “Spend Money to Make Money”

A big myth that many small business owners fall victim to is the idea that you need to “spend money to make money.” This couldn’t be further from the truth – there are many ways to be creative when starting a business that don’t demand a huge amount of startup capital. Let’s take a look at a few different ways this myth can show up in small business spending, and why you don’t need to repeat the same mistakes in your own business.

You Don’t Need a Huge Amount of Startup Capital

Starting a business can be much more financially accessible than many of us might believe. Depending on what type of business you’re starting, you can begin to pilot your business idea and make a profit with only a little bit of startup cost.

Many service-based businesses require very little upfront investment. Product-based business will require expenses for inventory, but these can still be managed and kept low.

Evaluate what your goals and values are for your business, and be thoughtful about how you can achieve your goals while keeping your expenses low.

You Don’t Need to “Keep Up with the Joneses”

Teddy Roosevelt said, “Comparison is the thief of joy,” and he was certainly right when it comes to small businesses! Comparing your branding, your website, or any other aspect of your business’s appearance can lead to emotional spending decisions and a desire for perfection.

The irony of comparing your business to another is that you usually have no way of knowing how other businesses are doing financially. For all you know, they could be close to bankruptcy, no matter how slick their branding or packaging is.

Instead of trying to “keep up” with other businesses and striving to achieve a perfect image of what you deem is professional, evaluate what’s truly important to your business. With each spending decision, ask yourself a couple questions: “Will this help me make more money?” and “Is this aligned with my goals and values for my business?” If your spending decisions are being influenced by comparisons to other businesses, take some time to ask yourself why you feel the need to do that, and how you can take that pressure off. Your business is yours, do it your way!

You Don’t Need to Take Every Training

Being experienced and well-trained is important. However, there is a strong tendency, especially among women who run service-based businesses, to over-invest in trainings, masterclasses, and certifications in their field. This typically stems from impostor syndrome, or some other version of the feeling that they are “not good enough.” This can prevent a variety of issues for the small business owner, but one of them is definitely overspending.

Reconnecting with your values can help you see past this impostor syndrome pitfall. Take some time to take stock of what you already know, and any certifications or experience you already have, before spending money on another. It might be helpful to keep a compliment file of positive feedback you’ve received on your services for when you need a reminder of the value of your abilities. Any or all of these ideas can help you re-evaluate overspending on education.

I hope that breaking down these 3 myths helped you see that spending money to make money is not necessary. If you enjoyed this post, you’ll also probably like my eBook, Reach Your Life Goals: A Business Owner’s Guide. Click here or below to download your free copy.

 

By |2023-07-26T12:29:07-07:00July 26th, 2023|Categories: Financial Clarity, Small Business, solopreneurs|Tags: , , , , , |0 Comments
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How Overspending Can Affect Your Small Business

We tend to think of overspending as a personal issue. A scene from Confessions of a Shopaholic might come to mind when you read the word – we think of this behavior as relegated to emotionally-motivated shopping sprees. But the truth is, emotional spending, and the resulting overspending, can easily happen in our business finances too.

What Does Overspending Look Like in Business Finances?

Overspending in business can show up in a variety of different ways, but there are two keys to recognizing it:

1)The spending behavior is emotionally motivated.

The emotional landscape underlying overspending is often one of insufficiency – we feel like there’s something about our business (or ourselves) that is lacking, so we rush to spend to make up for it. This can manifest as easily-labeled emotional issues like impostor syndrome, or perfectionism, or the myth that you need to “spend money to make money.”

As a general rule, it can be helpful to do some emotional inquiry around your finances. When making spending decisions, try asking yourself, “What emotions are coming up around these decisions?”

2) The spending on one area of the business is detracting from others that may also need some monetary resource.

This can be hard to spot. Especially for small business owners, there are often not clear industry standards for how much a business “should” spend on a particular category, and even if these do exist for your niche, they may not be helpful or accurate. However, if there is a clear difference between the amount you’re spending in one area and others, and there is an emotional component to that spending, then it may be overspending.

How Can Overspending Affect Your Small Business?

This is the interesting paradox of overspending – it creates deprivation. Karen McCall summarizes this idea beautifully in her book Financial Recovery when she explains how overspenders are likely to spend it all on “pretties” while neglecting the “necessaries.” This can show up in a business in situations where certain pieces, like aesthetic branding or top-of-the-line equipment, are easily prioritized, but there isn’t enough cash on hand to pay for a business license or save for tax expenses.

The result is not a financially functional business. While there are some elements covered, without a money system that prioritizes important logistics and gets you paid, the business will soon become draining to run and simply eat cash.

You Know Best

It’s important to remember that when it comes to your business, you are the best expert. Nobody can decide that you’re overspending on a certain category except you. A good bookkeeper or a money buddy can help observe financial patterns in your business and give you some advice, and this can be an extremely helpful resource! But ultimately, you call the shots around spending in your business – it’s important to remember that and to stay confident in your choices.

If you liked this article, you’ll probably enjoy my free EBook, Reach Your Life Goals: A Business Owner’s Guide. Download a free copy here.

By |2023-07-26T11:01:49-07:00July 14th, 2023|Categories: Financial Clarity, Small Business|Tags: , , , |0 Comments
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Why Your Finances are the Key to Self Care

We know that self care is important. We know it’s important to do things like unplug from electronic devices, get exercise, and treat ourselves. But oftentimes the conversation about self care can leave out one important aspect: financial self care.

Financial self care is the foundation of all other self care in your life, so it’s a shame that it gets forgotten! By financial self care, I mean doing the routine maintenance and occasional projects to keep your finances in good order. Things like reviewing your spending plan on a weekly basis and planning for irregular expenses are key to other aspects of your life. When your money is in order, it is so much easier to care for yourself. Your physical, spiritual, and mental health benefit when you are confident in your financial situation.

What are some areas of your life that need more care? Take a moment to really think about this. Perhaps you want to be able to purchase organic food or pay for a medical treatment. Maybe you want the ability to work less and turn down certain engagements. Or maybe you would benefit from seeing a therapist or spiritual worker.

Underlying all of these self care actions is a financial decision. When you engage in a regular financial self care routine, these decisions get easier. When you know whether you’ve met your spending limit for a category, deciding whether or not to spend the money to get that massage is much more simple. Regular financial self care takes that guesswork away and helps you get clear.

Financial self care involves engaging in a process of setting financial goals and working out what you actually want to spend your money on. When you’ve got this worked out, it makes it much easier to decide what to spend money on in order to take care of yourself. This process can illuminate what you really need and want. Therefore, it can deeply assist your overall journey of self care.

9 Secrets to Financial Self Care Book Cover

I created a full e-Book on the concept of financial self care, which you can download by clicking here. This e-Book goes into depth on many different strategies to infuse your days with financial self care and build a solid routine for yourself. If you are interested in exploring how financial self care can support your life, I recommend giving it a read!

☮

Angela

By |2021-04-08T14:27:43-07:00December 8th, 2020|Categories: Financial Clarity, Money Mindset|Tags: , , , , , , , , , , |0 Comments
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