Have you ever heard anyone say that they want to wake up every single day and stare at their dwindling bank balance? Especially a business owner or start-up founder? No one ever has and no one ever will. Especially if you are hell-bent on living a financially cushioned life (who isn’t?) and leading your business into profit.
It can take a lot of discipline to keep track of the finances and make smart decisions all the time. Especially, when you know that your expenses are getting out of control and you don’t have the funds to back it up – this is a common problem with start-ups.
Most start-ups face this issue of managing their finances. Someone who is new to the entrepreneurial world and doesn’t have much knowledge of money is more likely to be broke or go through a major financial crisis than someone who knows the ins and outs of managing the cash flow. Being educated and informed about personal finances is key to keeping the asset column healthy without compromising with the success or becoming mentally frustrated.
Mental agility, determination, and financial know-how helps start-up owners keep their asset column healthy. It is never a great idea to spend your hard-earned money on things that are not going to serve you in the long term – this has to be applied when starting a business as well.
Many startup founders take unwise decisions because they read about what one of their ideals do or how they live or something they are interested in. Earlier, resources were limited and there was no internet connectivity in most parts of the world, so only a fortunate few got a glimpse in the lives of millionaires.
But now, you have all the resources and information that is required to become a millionaire; and also to follow a millionaire’s lifestyle. This can be used as motivation but most people are blinded by the shine of the diamond and forget all the hardships that made the diamond shine.
Most millionaires buy houses and expensive cars but they don’t break their savings to do so – you might want to follow their lifestyle but you also need to take the incoming cashflow into account if you are trying to impersonate the outgoing dough under the guise of a successful person’s lifestyle. They have money coming in from various investments that take care of their need to live a luxurious life and start-up owners often don’t, so, if you try to walk in their shoes, you can’t pick and choose according to your convenience.
“Our incomes are like our shoes; if too small, they gall and pinch us; but if too large, they cause us to stumble and to trip.” -John Locke
Of course, money won’t come pouring in just by knowing how to manage your finances, you will have to face the adversities and challenges that you are likely to face on the road to success. But by impersonating and walking in the footsteps of successful people, you can set up a good platform for yourself, only if you take into account the bad as well as the good.
Yes, it is difficult to manage your finances and make smart decisions all the time as a start-up. You are bound to make mistakes but those mistakes should teach you a valuable lesson. If you don’t learn anything then the difficulty can turn into impossibility real quick. Keep learning from the people who have made it but let the shine of their own car and assets blind you.