Tuesday, August 31, 2010

Minding Your Business

"Many people confuse their profession with their business,” says Robert Kiyosaki. “To become financially secure people need to mind their own business.” (Kiyosaki)

When we were kids we used to always say, "mind your business" or "This is an A and B conversation, you need to 'C' your way out!" All of those phrases were clever ways of telling people to leave.  I re-read the Cashflow Quadrant by Robert Kiyosaki this past week.  Towards the end of the book he retells the story of why he needed to mind his own business. He wrote about a conflict that he had at work with his supervisor.  He continued to have conflict with his superior because he felt that his superior wasn't doing what he should do to advance the company.  Kiyosaki looked at himself and realized he was projecting onto his boss what he was afraid to do on his own. 

This chapter hit me with a strong blow. I immediately related his tale of woe to my own day job.  I have a deep conflict with my superiors inability to move forward on a more aggressive marketing campaign. We just returned from a long holiday and I tried to promise myself not to get emotionally involved in the operations of my E Quadrant position.  (E Quadrant= Employee Position) However, I couldn't help it. I can see the potential and it disturbs me that as a company my E Quadrant hasn't moved forward. At the end of the day, I sat down on the train and read, "mind your business".  "To become financially secure people need to mind their own business." (Kiyosaki)

What does minding your business look like?

If you are minding your business then you are actively looking for ways to expand your net worth.  You are checking your house and making sure you plug up the leaky roof. Here are some baby steps you can take towards your goal:
1. Complete your own Financial Statement
2. Set your Financial Goals
3. Set your Personal Goals
4. Create your 5 Year Plan

What does minding your business sound like?

1. How can I pay down my outstanding debt and become financially free?
2. How can I create an additional $150-$200 a month to invest or pay down outstanding debt?
3. I will delay gratification on things that I don't need and learn to plan for those that I do.
4. I am building towards becoming financially free.

What does minding your business feel like?

1. I feel confident in knowing where I am and where I am going.
2. I am financially intelligent.
3. I am focused and assured that I will reach and surpass my goals.
4. I am at peace knowing that I am not hiding from the truth, but I am embracing it and moving forward.

I have a new mantra and it's taken on a new meaning, "Mind my business." If you see me muttering, don't worry, I'm just minding my business.

Now, here are some words from a familiar face

Sunday, August 15, 2010

Are you still taking notes on the back of an envelope?

Just like most of you, I'm looking for ways to increase my net worth and decrease expenses.  I'm always scanning for ideas online. At one point in my life, I thought these gurus of ideas were onto something.  One article suggested cutting out cable, I don't have cable. Another suggested, skipping the gym. I need the gym.  I don't want to increase my health expenses because I'm crippled with disease.  This other idea really made me laugh, 'wash with cold water'. Now really, do you think your water bill is the main thing that's keeping you from financial freedom.  Some of the lists are downright extreme !  Don't give cards or gifts for birthdays?  That would be a great idea, I guess, but its 2010. When was the last time you sent a card? 

The one tip that so many "advisors" encourage us to do is to keep track of our budget. Where are we putting our money? I guess they want to tell you to cut out that morning cup of delicious fancy hot chocolate, the one with the extra sprinkles.  The question is, where is your money really going?

We are fortunate enough to have a technology as a guide to helping us find the answer. There are loads of new apps and gadgets to track your expenses. I used to carry a notebook around with me documenting every water bottle I bought or every time I bought a bag of potato chips. Those things seemed great at the time, but at the end of the month all those little scribbles in my notebook meant nothing.  I never did anything with those numbers except look at them. 

I did a search online and found some great FREE budgeting software. Some may say, get an iPod and you can do it automatically.  In the spirit of keeping costs down, I don't have an iPod.  So now, at the end of the day when I get home I gather all of my receipts and I turn on my old laptop and document my expenditures.  I can actually see where my money is going in percentages.  I can see if I'm spending more on going to the grocery store or eating out.  I can see percentages for entertainment vs building my business.  Now, instead of writing on the back of an envelope or squeezing things in a notebook, I am able to get a visual on how much I'm spending and where my money is going. 

Throw out those napkins and tiny notebooks! Do something that's environmentally conscious and convenient!
Check out these websites on how to get started:

I started with this family budget guide. If you want something that is relatively simple to use, but basic you can try this one:
Family Budget Planning Guide

I really like Outright!  It's graphic and convenient. I documented the cashflow from my business and it immediately showed me in graphic form the profit and expenditures. This program is great! You can even add your own bookkeeper as an administrator. I believe this will take the hassle out of filing taxes to some degree. 

I'm sure there are more ways to keep track of expenses, if you have any ideas please add them in the comments!