After over a year of quarantine and as countries and places start to welcome more visitors, you may be starting to plan trips. You may already have a list of where you’re going to travel. You’ll definitely want to listen to this episode of the podcast where I speak with Lee Huffman of Bald Thoughts about tips to use credit card rewards to travel for less.

Listen and subscribe: iTunes, Stitcher, Spotify

Lee Huffman, Bald Thoughts

I used to work in corporate finance for a regional bank in Los Angeles. When it was made clear that it was time to leave, I quit my $200,000 job and moved to Nashville. Now, I write travel and personal finance articles full time and host the weekly We Travel There with Lee Huffman podcast.

I also freelance write for many popular websites, including Forbes, Investopedia, FinanceBuzz, NerdWallet, SlickDeals, and more.

Bald Thoughts Instagram, Twitter

What You’ll Learn:

In this episode, we discuss:

• How to travel for cheap or low cost
• How to use credit card miles and rewards to travel
• How to prepare your credit to get the best credit card rewards
• How to pick the best reward cards
• How many credit cards you should have
• A system to manage all your cards and rewards
• How to find the best experiences and spots when traveling

Resources Mentioned:

• Cashbackmonitor.com
• annualcreditreport.com
• Debitize
• Award Wallet
• We Travel There Podcast
• Bald Thoughts
• 7 Days to Your Dream Vacation

Thanks for Listening

If you have any comments or questions about this episode, leave a comment below. If you liked what you heard subscribe on iTunes, Stitcher, or wherever you listen to podcasts and rate it. This helps the podcast show up for others.

The post POM065: Maximize Credit Card Rewards & Travel For Less with Lee Huffman appeared first on Pocket of Money, LLC.

One of the main things that prevents people from consistently budgeting is how they perceive a budget. A budget is often looked that as a way to restrict spending or spend less money. However, a budget is simply a plan for your spending. The budget is a major piece of the plan to achieve financial goals. Is the plot of where your money should go in order to make progress with financial goals.

Budgeting does take some practice to get it right and, in the beginning, as in when you start using a budget or trying to become consistent with using a budget, a lot of questions will come up. There will be different scenarios regarding life events or your savings or your debt are how to handle certain situations that will come up.

That’s what I discuss in this episode: the top budgeting mistakes and questions that may be preventing you from successfully budgeting.

Listen and subscribe: iTunes, Stitcher, Spotify

Resources Mentioned:

WISE Financial Fitness

WISE Financial Fitness is filled with personal finance and business courses, protocols, and resources to increase your financial fitness. You can be paired with a Junior or Senior Money Scientist to craft a comprehensive money strategy for your unique situation. 

WISE Budget Box

The WISE Budget Box will help you Go from “I hate budgeting” to consistently planning, successfully budgeting, and saving money every month. In the box you’ll receive everything you need to implement the 90 day budgeting system including the wise budget planner, fun financial and goals stickers you can use in the planner, and saving and debt tracking sheets.

You’ll also have continuous access to the WISE Financial Fitness online academy filled with courses, protocols, and digital resources. Just when you start to fall off, the WISE Budget Box will give you a motivational jolt and you’ll get the box in the mail filled with a new set of tools every 90 days.

How I Decreased My Food Budget by 79%

I decreased my food budget by 79% and it didn’t have much to do with couponing. Food can be one of the more expensive categories in your monthly budget. It’s not a fixed expense, the amount is dependent on you. But that’s also the problem, the amount is dependent on you.

Financial Planning Roadmap 2nd Ed

This financial planner helps you consistently budget (by month or paycheck), analyze your budget, and track and analyze side hustle earnings for profit. If you don’t like your financial situation, then change it.

Thanks for Listening

If you have any comments or questions about this episode, leave a comment below. If you liked what you heard subscribe on iTunes, Stitcher, or wherever you listen to podcasts and rate it. This helps the podcast show up for others.

The post POM064: 10 Top Budgeting Mistakes and Questions Explained appeared first on Pocket of Money, LLC.

In this episode Atiya Brown, The Savvy Accountant shares:

• the most common mistake new entrepreneurs make with finances
• what documents entrepreneurs should track for taxes
• the best tools to track items for business records
• the most important items to track to avoid problems with taxes
• personal finance tips for entrepreneurs
• money management tips to better your credit the most important tip to get business credit

Listen and subscribe: iTunes, Stitcher, Spotify

Atiya Brown, The Savvy Accountant

Atiya S. Brown aka The Savvy Accountant is a CPA, CA, and a Certified Financial Educator Instructor.

She has over 15 years’ experience in the accounting/finance world. She attended The John Molson School of Business (JMSB) in Montreal, Canada for both undergrad and graduate studies. She finished in the top 5 of her graduating class before completing the Chartered Accountancy examination to become a CPA, CA.

Atiya is the creator of The Savvy Accountant – where she specializes in helping small business owners maximize their financial position and position them for growth. She has a particular expertise within the real estate industry and is their go-to Accounting and Tax Advisor.

Resources Mentioned:

What Are The Money Rules? by Rayna Brown

This is a children’s money book written for children by a youth author.

MileIQ – mileage tracker

Savvy Accountant – business website for Atiya Brown

Live Financially Savvy – personal finance website from Atiya Brown

WISE Financial Fitness

WISE Financial Fitness is filled with personal finance and business courses, protocols, and resources to increase your financial fitness. You can be paired with a Junior or Senior Money Scientist to craft a comprehensive money strategy for your unique situation.

Thanks for Listening

If you have any comments or questions about this episode, leave a comment below. If you liked what you heard subscribe on iTunes, Stitcher, or wherever you listen to podcasts and rate it. This helps the podcast show up for others.

The post POM063: 8 Tax Tips to Better Your Business and Personal Finances with Atiya Brown appeared first on Pocket of Money, LLC.

I’ve debated with others if a person who is working on mastering their money should be focused on cutting costs and decreasing expenses or increasing income. This is a question or debate have seen play out online as well. In this episode, we are going to talk about which one is the best way to increase financial fitness: cutting costs or increasing income.

Listen and subscribe: iTunes, Stitcher, Spotify

Resources Mentioned:

WISE Financial Fitness

WISE Financial Fitness is filled with personal finance and business courses, protocols, and resources to increase your financial fitness. You can be paired with a Junior or Senior Money Scientist to craft a comprehensive money strategy for your unique situation. To get the 60% discount, use the code WISE60. It expires February 15, 2021.

Financial Planning Roadmap

This financial planner helps you consistently budget (by month or paycheck), analyze your budget, and track and analyze side hustle earnings for profit. If you don’t like your financial situation, then change it.

WISE Money Challenge Tips to Save and Earn More Money

Ebook where I include over 100 side hustle resources in 10 categories. This book also contains in-detail 22 specific actionable tips to save or earn more money. It’s set up as a challenge to get you to take an action each day.

WISE Budget Box

Go from “I hate budgeting” to consistently planning, successfully budgeting, and saving money every month with the WISE Budget Box subscription. Only $75 per quarter ($25/month).

Just when you start to fall off, the WISE Budget Box will give you a motivational jolt and a box filled with a new set of tools every 90 days. You’ll also have continuous access to the WISE Financial Fitness portal filled with courses, protocols, and digital resources.

Thanks for Listening

If you have any comments or questions about this episode, leave a comment below. If you liked what you heard subscribe on iTunes, Stitcher, or wherever you listen to podcasts and rate it. This helps the podcast show up for others.

The post POM062: Cutting Costs Versus Increasing Income appeared first on Pocket of Money, LLC.

With the pandemic and quarantines, we had to transition to doing almost everything at home. We had to rethink a lot of activities and normal protocols for doing things. This also applies to how we deal with our money and business or side hustle. In this episode, we’re going to discuss how the rules or common procedures around personal finance and business have shifted or changed. Things that you will need to do for financial and business success.

Listen and subscribe: iTunes, Stitcher, Spotify

Resources Mentioned:

The Millionaire Next Door by Thomas Stanley and William Danko

The Wealth Choice by Dr. Dennis Kimbro

WISE Financial Fitness

WISE Financial Fitness is filled with personal finance and business courses, protocols, and resources to increase your financial fitness. You can be paired with a Junior or Senior Money Scientist to craft a comprehensive money strategy for your unique situation.

WISE Budget Box

Go from “I hate budgeting” to consistently planning, successfully budgeting, and saving money every month with the WISE Budget Box subscription. Only $75 per quarter ($25/month).

Just when you start to fall off, the WISE Budget Box will give you a motivational jolt and a box filled with a new set of tools every 90 days. You’ll also have continuous access to the WISE Financial Fitness portal filled with courses, protocols, and digital resources.

Thanks for Listening

If you have any comments or questions about this episode, leave a comment below. If you liked what you heard subscribe on iTunes, Stitcher, or wherever you listen to podcasts and rate it. This helps the podcast show up for others.

Episode Transcript:

This transcript is edited and not verbatim.

Hey Success Rebels, It’s Dr. Maria James The Money Scientist. With the pandemic and quarantines, we had to transition to doing almost everything at home. We had to rethink a lot of activities and normal protocols for doing things. This also applies to how we deal with our money and business or side hustle. In this episode, we’re going to discuss how the rules or common procedures around personal finance and business have shifted or changed. Things that you will need to do for financial and business success.

As a reminder we have great resources and articles on the blog at pocketofmoney.com. For those looking for a deeper dive into mastering their money and their business check out our programs WISE Financial Fitness and WISE Budget Box. Not only is WISE Financial Fitness filled with courses, protocols, and resources to increase your financial fitness, but you can be paired with a Junior or Senior Money Scientist to craft a comprehensive money strategy for your unique situation. I will have a link to WISE Financial Fitness and the WISE Budget Box on the show notes page at pocketofmoney.com.

There was a significant shift in the financial status of a lot of people. A lot of people found themselves in financial situations that was unexpected in terms of good and bad. Millions and millions of people had to file for unemployment. So many people were furloughed or let go from their positions and had difficulty finding a new position in their industry because the entire industry was negatively impacted by the pandemic. It’s one thing for a single company to be going through a tough time and have to furlough or let people go, but it’s another ballgame when the entire industry is having a tough time so numerous companies within that industry letting people go or furloughing their employees.

Looking at it from the employer or entrepreneur side, many entrepreneurs had and continue to have a tough time. They experienced a significant negative shift in their financial status if their business was in one of the industries that were significantly constricted by the pandemic.

On the other side, there are a number of entrepreneurs who saw significant gains or reached significant revenue milestones. For some small business owners, last year during the pandemic was one of their best years in business in regard to the number of people served or revenue made. Not every single industry was negatively impacted by the pandemic. There were and are some people who thrived. You know some of the really big you household names that are thriving such as Netflix and Zoom. So many more people are at-home streaming shows and movies.

It seems so long ago when we would make plans to go to the movies. Stand like a foot apart in line and go into a movie theater with a bunch of strangers and sit like 6 inches apart not 6 feet and enjoy a good show. And if it was a really good movie, you have a whole diatribe in your head about what you would do if you were the character in the movie and then discuss that whole diatribe after the movie when you’re talking about it with your friends or whoever you went with to see the movie.

Now, in many places you can’t go out to the movies, so the next best thing is to both stream the same movie on a streaming platform and be on the phone at the same time or use a messenger app to watch it together. And of course, it seems like everyone is using zoom to meet for business or social activities.

I think it’s safe to say that both of those companies and similar companies are doing very well. The type of financial status shift really depended on what industry you are in and how quickly you or your employer was able to pivot to serving customers or clients online and moving business operations online.

However, whether it was a positive or negative impact, there are shifts in the common advice or rules regarding personal finance and business that affects us all.

1) How much you should save.

I’ve seen a lot of people state that you should save or aim to save 10 percent of your income. This is considered common financial advice. However, I’ve always advised to save or rather aim to save 20% of your income. This came from when I was first starting on increasing my personal finance knowledge and working on my skill set. I can’t quite remember which book it was, but it was either The Millionaire Next Door by Thomas Stanley and William Danko or The Wealth Choice by Dr. Dennis Kimbro. It was one of those books or maybe listed in both of them. They each discuss habits of the wealthy. They mentioned that the wealthy saved and those who successfully build wealth saved 20% or more of their income. Then of course those savings were funneled to other financial goals and investments.

A few years ago, the average American saved around 4% of their income. In 2020, the pandemic cause that number to significantly jump as people rightly started hoarding their cash and being more conservative with spending. A magnify Money study found that the savings rate jumped to over 33%. People moved from saving less than 4% to saving over one third of their income.

I hope this becomes the new normal. I believe this needs to be the new normal. Try to save as much of your income as you possibly can. This way you have more money to funneled towards financial goals. Keep that same saving energy even as things start turning around.

2) Total Emergency Fund

The next thing is the emergency fund. Last year exemplified the need for an emergency fund. Money set aside for when there is a financial disruption. That disruption can be the significant decrease in income or significant increase in expenses. But having money or rather cash set aside to be able to handle a significant drop or hike in your finances.

I had a lot of people feel that if they had three months’ worth of bills set aside that this amount was enough to act as an emergency fund. Now everyone has a different level of risk tolerance. I am more risk averse, so my risk tolerance is not as high as other people. So for me I always liked to have around a year’s worth of expenses set aside for my emergency fund. As an entrepreneur, a year to 18 months’ worth of bills set aside is much more comfortable to me. Some people thought that this was crazy that I had way too much money just sitting aside not earning interest not doing anything for me. They would argue you know old imagine how much money you be making if you invested a lot of that money. If that is the price for peace of mind, then I’ll pay that price.

Now here comes pandemic rolling through and now I bet that that doesn’t look too crazy to have in all 12 months’ worth of bills set aside. No one could foresee the length of time that there would be a financial disruption for a lot of people you know due to the pandemic. People were comfortable with a smaller emergency fund because of their financial status at the time as well as their level of risk tolerance.

You have to consider your own risk tolerance and how much will give you peace of mind. I do think people should at least aim for the traditional 6-9 months and not do 3 months’ worth of bills as a complete emergency fund. I get it if you’re pausing there to pay off some debt then resume.

I know a complete emergency fund is a large dollar amount. It can take a long while to save up that amount of money. It can take a while to re-build it if you had to exhaust it or use up a large portion of your savings. Keep working at it and you’ll get there.

3) Cutting Costs Is Not Enough

A lot of personal finance advice focuses on cutting costs. There are a lot of tips and some experts go the way of shaming people into spending less money. However, spending less money is not and should not be the only focus. I think that too much attention is spent on only trying to get people to spend less money. You can’t spend less of what you don’t have in the first place. Spending less is not the only way to live within your means.

Don’t get me wrong. Streamlining your budget is very important. You definitely should optimize your budget, your income, or cash flow to put as much money as you can towards things that are important to you and towards your financial goals.

All the tips and information on creating good financial management systems and behaviors are crucial to financial success. No arguments there. However, there should be equal emphasis on increasing income and earning more money. More disposable income plus good financial management techniques equals a faster path to financial success.

Don’t only focus on cutting costs. Start there because decreasing expenses is the quickest way to take control of your money. However, all when you have streamlined your budget then turn more of your focus and energy to increasing your income. Side hustles and having multiple income streams or the saving grace for many people whose main business lost a lot of revenue or were furloughed or were laid off from their employment.

4) Don’t Let Good Debt Linger

It is said that there is good debt and bad debt. Bad debt would be things that have high interest rate such as credit cards or was used to purchase things that aren’t necessarily providing a return on investment.

Good debt is considered to be loans that have a low interest rates and are used for something that brings a return on investment. For example, student loans are considered good debt because in theory you should be able to get a higher paying job you would not have been able to obtain without the degree that you used student loans to get. A mortgage loan is also usually considered good debt because again in theory as you pay down the loan you build equity in your home and the home becomes an asset.

Well good or bad debt is debt. If you run into tough financial situation or tuft times, this is still money that will be coming out of your household. This still has the potential to be a source of stress when income becomes strained and that can happen for a number of different reasons. For many it is worth the peace of mind to have their home completely paid off or simply just not have to owe anyone and be able to put more money towards wealth building.

I know there will be some people that say you know run the math. And show that if you invest while paying off a 30 year mortgage than you end up on top because of the money made in your investments over the 30 years. Well 30 years is of long period of time and a lot happens in 30 years. Why not do both and pay off the mortgage your student loans sooner and then put even more money towards investments.

5) Stop Using 401(K) Loans For Business And Large Projects

It is possible to borrow money from your 401(k) before retirement and then pay it back over a specific amount of time. A 401(k) loan is different from a withdrawal. With a withdrawal you don’t pay the money back and you get hit with a lot of fees for taking the money out before retirement. Therefore, some people will use a 401(k) loan where they’re just borrowing the money to fund starting a business or do a large project such as a home repair project or something similar.

I’ve seen some business coaches state this as a good way to pay for a coaching package to start up a business. And no one probably biased because I’m money person but I do not agree with this method. Borrowing from your 401(k) is pretty risky. You run the risk of not being able to repay the money in a timely fashion should something happen to your job. Even if you just want to get different employments or transition to the sale better paying job you would then old the balance plus interest on the amount that you borrowed from your 401(k) immediately. If you can’t pay back the balance then you’ll get hit with a penalty of 10% and have to pay taxes on the amount that you borrowed.

Also you lose out on any potential gains that you would have received because not just a simple as putting the money back you’re paying it back slowly over time. Therefore, the amount of investments that is growing is much smaller.

I would suggest bootstrapping a business to start and saving up were earning the money necessary to invest in the coaching program of your choice. Try not to borrow from the 401(k) unless it is a true emergency and you have no other option.

6) It’s okay to start just to make money.

Alright now we are shifting gears a bit to business and entrepreneurship.

It is common advice to tell aspiring entrepreneurs to start a business based on their passion. Pick an industry or topic that you are passionate about and would do even if you couldn’t make money from it. There’s nothing wrong with this advice because I truly believe that you can figure out a way to make money in the industry that you’re passionate about. That passion will help you to re-motivate yourself when the days are long, the nights are long, things have fallen through, and numerous other reasons why an entrepreneur has a tough day.

However, it’s also perfectly acceptable to start a business or side hustle purely to bring in additional income. If you are really good at something or have a strong skill set and you want to monetize that skill set or your knowledge in a field and then go for it. Perhaps is not your passion but you know you could monetize it do it well and serve your customers or clients well. There is nothing wrong with that and side hustles and businesses being built by employed entrepreneurs are the MVPs during this pandemic. A few extra hundred or thousand dollars per month makes a huge difference.

Remember that each sale is backed by a person. Remember that you are serving your client or customer. This is the case if it’s a product-based business or service-based business or hybrid of the two. If you keep the top of mind that you are helping someone in exchange for that money, then you will be able to build a successful business. Focus on the people and getting them what they need in order to be able to make the money that you want.

People like to buy things, but they don’t like to be sold.

7) Create an operations fund.

The same way we just talked about an emergency fund and extending that for your personal finances. As an entrepreneur, you should have what I call operations fund. This is like an emergency fund for your business. This is money set aside to continue operating the business should there be a significant disruption in revenue.

I’ve always recommended 18 months’ worth of expenses set aside especially if you are a recent entrepreneur as in you started your business within the last 2 to 3 years. This number comes from my own experience when I was starting my business Pocket of Money. The pandemic definitely reiterated this lesson.

You may be thinking but that’s a large amount of money. I get it and the reasons are the same as were the emergency fund for your household expenses. It may take a while to save up that dollar amount. However, having the money there offers a peace of mind and a very real resource or tool to weather any unexpected financial disruptions.

The post POM061: New Personal Finance and Business Rules Learned from the Pandemic appeared first on Pocket of Money, LLC.

Listen and subscribe: iTunes, Stitcher, Spotify

Bevin Morgan is a financial wellness coach providing community and accountability to Black women who are ready to step into financial confidence and abundance.   She has paid off over $200,000 of debt to become debt free. She currently owns two duplexes and is planning to buy six additional units over the next two years. She has made several job and career changes and is currently building a successful business as she works full-time. Her relationship with money has helped her live a life of purpose and ease despite the fact that she’s never stopped working hard (it just doesn’t feel like hard work).

In this episode, Bevin discusses how she dug her way out of taking granola bars from work to survive to paying off $200,000 of debt without only being extremely frugal. You’ll learn

• steps to create a mindset shift
• an action plan to pay off debt
• key tools or tips to get out of debt and stay motivated
• how to work as a couple towards financial goals

Resources Mentioned:

Bevin Morgan’s Website – get additional information and resources

Bevin’s Instagram profile

WISE Budget Box

Go from “I hate budgeting” to consistently planning, successfully budgeting, and saving money every month with the WISE Budget Box subscription. Only $75 per quarter ($25/month).

Just when you start to fall off, the WISE Budget Box will give you a motivational jolt and a box filled with a new set of tools every 90 days. You’ll also have continuous access to the WISE Financial Fitness portal filled with courses, protocols, and digital resources.

Thanks for Listening

If you have any comments or questions about this episode, leave a comment below. If you liked what you heard subscribe on iTunes, Stitcher, or wherever you listen to podcasts and rate it. This helps the podcast show up for others.

The post POM060: How to Pay Off Six Figures of Debt as a Couple with Bevin Morgan appeared first on Pocket of Money, LLC.

Listen and subscribe: iTunes, Stitcher, Spotify

The entrepreneur roller coaster may have been crazier than normal for the past 12 months. No one really foresaw such craziness was going to happen. However, it’s a matter of time before a recession hits. You can take steps to make it through the current downturn and to make sure you’ll weather a recession successfully. In this episode, you’ll learn eleven strategic tips and actions to recession-proof your business. These tips apply whether you’re a service or product-based business.

Resources Mentioned:

WISE Budget Box

Go from “I hate budgeting” to consistently planning, successfully budgeting, and saving money every month with the WISE Budget Box subscription. Only $75 per quarter ($25/month).

Just when you start to fall off, the WISE Budget Box will give you a motivational jolt and a box filled with a new set of tools every 90 days. You’ll also have continuous access to the WISE Financial Fitness portal filled with courses, protocols, and digital resources.

Business Goals Planner

Get organized, make progress, remove overwhelm, and increase your revenue. You’ll design clear goals and a powerful strategy to achieve them. Don’t just make a long to-do list that leaves you in overwhelm.

Focus on tasks not just your schedule. Clearly write tasks each day that will help you move your projects along. Organize tasks each day by project to help with project management. Stay ultra-focused each quarter. You’ll power through your tasks with this 90 day progress system.

Financial Planning Roadmap

This financial planner helps you consistently budget (by month or paycheck), analyze your budget, and track and analyze side hustle earnings for profit. If you don’t like your financial situation, then change it.

The Brave Entrepreneur’s Desk

I reveal major lessons l learned during my journey, and powerful affirmations and epiphanies that will keep you motivated and progressing as an entrepreneur.

Thanks for Listening

If you have any comments or questions about this episode, leave a comment below. If you liked what you heard subscribe on iTunes, Stitcher, or wherever you listen to podcasts and rate it. This helps the podcast show up for others.

Episode Transcript:

Hi Success Rebels. This is Dr. Maria James, The Money Scientist. For many of us, it’s been a tough time to be an entrepreneur or small business owner. While for some of us, the last 12 months or so have been the most lucrative time period in quite a while.

I’ve spoken with colleagues who hit revenue milestones and have spoken with some whose revenue came to a halt.

I guess like any major event or situation, the pandemic made some industries and side hustles become popular. For example, accounting became really hot as people try to make sure their finances were on point. Of course, everything virtual went through the roof. I saw things like virtual babysitting and virtual storytime become very popular.

Everyone felt like they had to become a expert on zoom overnight. Of course, this resulted in zoom stock going through the roof.

No matter your business or side hustle you had to do some sort of pivoting as a new normal was established. Even if your business provided and online service or product, you still had to pivot because you were audience had a mindset shift.

I made some pivots as well to accommodate the new normal. For example, people were complaining about computer or screen fatigue. Since so many words teleworking and schooling when online as well, after the work or school the people did not want to stay looking at their screens.

I launched a brand-new product called the WISE Budget Box: Success Rebel Budgeting Kit. It’s a physical box with a budgeting planner, planner stickers, tracking sheets, and other goodies to get people to consistently plan, successfully budget, and save money.

It moves away from the online budgeting spreadsheet and gives people a break from the screen and a fun way to budget using a 90 day system.

This isn’t the only shift that I needed to make in order to recession-proof my business.

Let’s get into the tips to really hammer home the business aspects or changes necessary.

We will start off with general proven actions to take. Then we will move into more specific actions and talk about examples so you can see a real-life application of the concept.

1) Worst-Case Scenario

First, you need to know what could be the worst-case scenario in order to properly prepare for it. You’re going to do a very simplified version of budget projections and financial modeling. Think about and determine the potential business challenges and obstacles.

• For example, think about during a recession what challenges could your business face.
• Then think about how those challenges will affect the revenue and expenses.
  1. Would revenue drop across all revenue streams? Which revenue streams would be most impacted? What is the expected decrease?
  2. What will be the effect on expenses?

Create a budget projection based on the changes you believe may occur. This will help you to prepare for shifting and scaling up revenue streams to make up for the decrease in other revenue streams. Even if you have only one revenue stream it will help you prepare to survive those numbers.

Create rules and policies as to when these solutions should be implemented and how. Have the plan strategy completely flushed out so when it’s go time you’re ready.

For each new year, each quarter, and a new launch, I do financial modeling to assess worst-case, expected, and best scenarios. I look at the numbers and make sure that I am able to handle the good or the bad.

2) List of vendor alternatives

From the current disruption caused by COVID19, you can see that having alternatives for suppliers and any vendors that you use is key. A lot of businesses that depended on suppliers based in China had severe delays in receiving products. They were left scrambling to find quality vendors to replace their current vendors.

You may have merchandise, a book, or other products you sell during your presentation or in the back of the room.

Create a list of backup vendors. Research and qualify them so if you need to use an alternate for any reason you already know you will receive quality items and be familiar with their process. Do this for every vendor in your business, as much as you can. Try to vary their characteristics, like geographic location, account for things like production capacity.

Think about alternative distribution channels for physical or online/digital products as well. Not only do you need to have backup vendors and suppliers to receive items you also want to think about distribution. If your current distribution channels are affected, who will your backup be?

I have two planners, a financial planner called the financial planning roadmap and a business planner called the business goals planner. These are printed physical books so I make sure to research several different printers and have a list as to who I can and want to work with to print my planners. I have two alternates that will keep the pricing and quality about the same. I did the same for my book The Brave Entrepreneur’s Desk.

You want to do your best to maintain your profit margin.

3) Alternative Business Model and Audience

You’ll need to do the same thing for your business model and target audience. I want you to think about what shifts you will need to make in your business in order to continue reaching clients and customers as well as offering products or services.

Many speakers have had to revise in-person workshops and presentations to be suitable and impactful online. Their pitches had to shift. The benefits presented had to be adjusted to show how they will still be experienced when presented online. Of course, budgets have to be adjusted as well.

For example, if you’re retail that could mean figuring out how to scale up the online store or how to offer a service that is completely online or digital. How are you going to continue closing the sale?

Think about who your target audience is and how you can shift the packages or offers to suit the new environment. The major question you will need to ask is which of your offers is a necessity for your customer or client? That’s where you focus your efforts. Necessities will continue to sell in good and bad times. The marketing is just different.

4) Diversify Your Revenue

It’s common for small businesses to have only one or a few clients that make up the majority of the revenue. This client or clients keep the lights on and the business operating. If they decide to take business elsewhere, then the business is immediately in severe trouble. Don’t put yourself in that position.

Not only do you want to make sure you have multiple revenue streams, you also want to have diversity in your customer base. For example, let’s say your industry was dog walking. In order to diversify, you could also include dog grooming, dog sitting, housesitting, a dog toy subscription box. See what I’m saying. Then diversify even more by diversifying to whom you offer the services: working professionals, stay at home parents, seniors, animal therapy organizations.

5) Have a Business Emergency Fund

You may have seen people online criticizing the corporations for not being able to survive decrease revenue for a couple of months. People were asking how or why are they expected to have money set aside to survive for several months but these huge businesses do not.

I always advise small business owners to have a business emergency fund. To start out, create a six-month fund of six months’ worth of operations costs saved. Then move to 12 months and if and when you can 18 months’ worth of operations expenses set aside. I base this recommendation on my experiences when I first became an entrepreneur. I had no idea what I was doing, those lessons are for another time, but I was able to survive taking care of my household and running the business for 12 months. If I would’ve had a little bit more saved up I would’ve been golden.

As we can see with COVID19, things happen where your revenue can be severely impacted for a long period of time. Things that are not under your control. It’s good to have a stash of cash or easily liquidated assets that can keep you operating during that time.

You need enough money set aside to pay all of the business expenses and implement the worst-case scenario strategy.

If you haven’t been severely impacted by the pandemic, start working on setting aside that operations fund. Talk to your accountant to determine the best way and place to set it aside.

6) Create A Necessity Service or Product

Spending decreases during a recession, obviously right. If you offer items or service that is considered a luxury then your revenue could significantly decrease or dry up. However, things that are deemed a necessity sell whether times are good or bad. For some industries, the purchase of these items will increase when times are bad.

How can you change what you offer into a necessity or change the perception so that people will want to purchase this item even when times are bad? Think about how the consumer mindset has shifted or changed? How can you shift with them? People and businesses are more focused on survival than luxuries. Not everyone, but the majority will have shifted this way.

For example, one industry that gets really busy is accounting. Accountants are still necessary to manage the money, especially for taxes. People and businesses are more likely to go to an accountant to make sure they’re getting the most tax breaks as possible. They want to know how can I lower my tax burden?

Instead of buying brand-new clothes, some will start visiting more thrift shops. If you sell clothes opening up a thrift shop section in your store or on your website similar to services provided by companies like thred up and poshmark will help you retain business. Think outside the box and get creative and shift with them. Figure out how you can make it a necessity.

Also pre-selling upcoming offers will help you bring in money and the person be able to secure something for later on when they are more likely to use it. Whether you allow them to put a down payment or start a payment plan or different things like that. If they have all the money up front that works as well. This can allow them to secure your service or product well in advance and bring in revenue for you. This is not anything new or fancy think of a ski resort pre-selling season tickets.

Think about how you can apply such things in your business.

7) DIY Options

More people are going to be staying in the house and are going to be tightening the purse strings. Think of how you can have more do-it-yourself options available for people. Those are going to sell a lot more and a lot faster than the done for you services and offers right now.

Really simple example, everyone has to eat. You are going to buy food and groceries. Grocery store revenue is increasing dramatically because more people are going to be cooking at home. They are and will be buying the ingredients in order to cook at home versus paying more to go out to a restaurant.

Food is the necessity and the grocery store is the DIY option. They are going to go pick up the ingredients and then go home and cook to maximize their dollars. DIY options that you can have and implement in your business where you’re still able to get those sales, you are still able to help your customer.

You’re still providing value and information and services to your customers and your audience but now it’s more of a DIY. It’s a little bit more passive. Figure out how can you implement that in your business.

8) Anticipate Next

Don’t only concentrate on what is happening and going on right now. Think about what they need right now and think about what your client or customer is going to need next. This is going to help increase the lifecycle of your customer or client.

This is also going to help you to keep the money coming. If you can’t provide it then figure out who you can partner with that’s going to be able to provide what they need next. JV partnerships and affiliate marketing can be quite lucrative for you and extremely helpful to your audience.

9) Lifestyle shift

As I said, more people are going to be staying inside so also consider that lifestyle shift. Think about what is going on with your client or customer, getting into their minds and how that’s affecting behavior in the new environment.

It will definitely help you create things in order to keep the money coming in and still serve them. That’s how you continue to get the money coming in, continue to serve. As you think about that lifestyle shift and their experience, what is something that they can do in their homes right.

For example, a business that had their sales absolutely skyrocket during the last recession was Snuggie. You know, you seen the commercial for the blanket with sleeves. I will admit. I do not like the cold and I have a Snuggie.

Their sales skyrocketed because people were at home. People were staying in for like movie night, or just sitting in the house doing something. Now the Snuggie is something that even though is more of a luxury item and not a necessity, let’s face it we could all use a blanket to ward off the cold, it was priced and positioned in a way that it was okay to purchase that luxury in people’s minds.

Another company that absolutely thrived was Netflix. Netflix shifted with the technology and the new environment during the last recession. That’s when they added streaming. Remember before Netflix actually had DVD delivery. You let them know what DVDs you wanted and they would actually physically send the DVDs in the mail to your house. During the last recession they added streaming. This kept people around because now it is unlimited. I can watch unlimited number of movies at a similar price point. I don’t have to leave my house. I don’t even have to go to the mailbox.

Shifting to adjust to the new environment. Their sales skyrocketed. They were in the mindset of the customer and shifted to give them what they needed so they can keep their revenue going and actually increase their profit and sales during a recession.

10) New Audience

Think about expanding to a new audience. Have it planned out where you can expand so even if you’re offering the product for the same service; if you offer to a new audience that opens up a whole new ballgame.

For example, the toy industry has been in trouble for quite a while. During the recession, toys are luxuries so those sales usually go down. The only company who really increased their profits and did it by 63% was Lego.

During the last recession even as the entire toy industry was tanking Lego increase their profits by 63% and why was that? Because they expanded beyond the US to Asia and Europe. The United States was their base and they expanded going to Asia and Europe.

They added a new audience, marketed to new people and was able to thrive during the recession. Who else needs what your offering? You can have more than one target audience, likely very similar but just enough of a tweak that opens up a whole new arena. Although before were talking about shifting your products and services, you that’s not the only way. Really think about who else needs what you have to offer.

11) Redesign Offers

Shift your business model, redesign your products and services. Let’s say you’re not too keen on expanding into new audience or you’ve already done that and your you still need to shift. Redesign a product or service and let your consumers or customers know that you’re doing it.

Let them know about all the new great things that are coming up, all the new things that you’re doing in order to serve them better.

Dominoes did that during the last recession, in 2009 they said during re-branding and marketing that the people said that their pizza taste like cardboard. They put it all out there and said hey we’re changing a recipe, we’re changing this retaining that, changing this and that. By shifting and redesigning and listening to their customers they were able to actually thrive during the last recession by changing things up.

Make sure that you are getting feedback from your customers or clients and think about how you can redesign or shift things so that during the recession you will still be able to bring in revenue and thrive. The key is to have the marketing around it. Don’t quietly behind the scenes simply change things.  Be straight up to let them know with full transparency. Hey we’re listening to you, we value you, we are implementing these changes to serve you better.

Applying some or all of these tips to your business or side hustle will help you to recession-proof your business and/or be ready to easily pivot when the next event occurs that necessitates change.

I’ll include links to all the resources mentioned on the show notes page at pocketofmoney.com. Alright, until next time.

The post POM059: 11 Business Tips to Survive a Recession or Economic Downturn appeared first on Pocket of Money, LLC.

Listen and subscribe: iTunes, Stitcher, Spotify

In this episode, I discuss important financial status indicators you should review before drafting your financial goals. Get clear on your real status and determine which financial goals should be top priority to increase financial fitness.

Resources Mentioned:

WISE Money Challenge Tips to Save and Earn More Money

Ebook where I include over 100 side hustle resources in 10 categories. This book also contains in-detail 22 specific actionable tips to save or earn more money. It’s set up as a challenge to get you to take an action each day. As a Success Rebel and listener of the podcast, you can get it for free. Use the discount code relief.

WISE Financial Fitness Score

Take the assessment to get your financial fitness score. This score is based on an algorithm I created to take into account not just the typical financial status indicators but behavior and mindset as well.

Episode Transcript:

Hey Success Rebel, it’s Dr. Maria James, The Money Scientist. We are officially in 2021. At the start of a new year is usually when a lot of us are focused on goals and changes that we want to see in our lives and our businesses.

Many people make New Year’s resolutions and either save them, write them down or create vision boards and collages. There’s something about the start of the new year that makes you think of a fresh start in general. It usually feels like everything is full of potential and opportunity, like you can make changes and progress.

Many New Year’s resolutions and new goals involve finances, and positive that this year is no different, probably even more so than usual.

You’re likely looking to increase your income this year, save more money, knockout some debt, or probably beef up your assets. And maybe all of the above.

This pandemic exemplifies why financial stability and financial security are so important. Financial stability is when your current financial situation is stable. Your income can take care of short-term liabilities aka your bills. You can purchase everything you need to survive. You also are able to handle most unexpected expenses.

Financial security means you can go beyond the basics. You have money and vehicles in place to handle future long-term financial goals and expenses. You’ve also taken steps to protect your money and wealth. You are secure in your ability to take care of things now and in the future.

These two things were rocked and completely stripped from a lot of people and most quite unexpectedly. It really brings home the importance of having money set aside that can accommodate several months’ worth of bills a.k.a. an emergency fund. Another major take-away is the importance of multiple income streams.

We’ve all heard about the importance of multiple income streams before, but the pandemic really reiterated that lesson.

Side hustles became significant lifelines to keep some level of income for many people and a way to focus on shoring up financial goals for others. An extra few hundred dollars per month can make a big difference. An extra few thousand dollars per month definitely makes a difference.

I really advocate for everyone to have a side hustle, multiple streams of income. Also, to diversify those streams. So, what do I mean by that, diversify? Well, have the streams be in different things. For example, I know a lot of people pick up a second job and some a third job in order to increase income or add income streams. This is a tried-and-true method.

However, jobs are streams that you cannot control. As we’ve seen if there is a major disruption to the economy this can result in a lot of furloughs or layoffs in many different job sectors or industries. I suggest also having an income stream that is completely within your control. This is where the side hustle comes in and there are so many options.

In my e-book WISE Money Challenge: Tips to Save and Earn More Money, I include over 100 side hustle resources in 10 categories. This book also contains in-detail 22 specific actionable tips to save or earn more money. It’s set up as a challenge to get you to take an action each day. As a Success Rebel and listener of the podcast, you can get it for free. Use the discount code relief. I’ll include a link in the show notes page.

Financial Status

Alright so taking it back to your resolutions and goals. As you are making goals about increasing your financial fitness whether that is saving money, making more money, eliminating debt and/or building wealth, first get clear on your foundation. Get clear on your current financial status or baseline financial fitness.

No matter what may have occurred this year, remember where you are now is not where you’ll always be. However, in order to craft a successful plan or strategy to get to where you want to be, you first need to be crystal clear on where you currently are.

Let’s go over three not so common or talk about financial status indicators. Most people rely on their amount of money in the bank and their credit score to assess their financial fitness. These are two great financial status indicators, but they don’t tell the entire story. You should look at some other numbers as well to get the full picture of your financial fitness.

When you determine these as well, you can begin designing a strategy to get to where you desire to be on your financial journey.

Financial Status Indicators

1) Savings – cash available

Look at the amount of money you have saved. Readily available cash definitely handy during an emergency or financial disruption. This is why saving money or establishing an emergency fund is one of the first steps in increasing financial fitness.

You have to have cash set aside for when that unexpected expense or hard time pops up. Without it, you end up borrowing money and going into debt. Debt erodes your financial stability and financial security.

If your current income covers all your household bills, but you don’t have money saved then creating an emergency fund should be a top priority goal.

If you have 6 to 9 months’ worth of bills saved, then you have a complete emergency fund. If you are an entrepreneur, I suggest extending that to 12 to 18 months’ worth of bills saved.

2) DTI – debt to income ratio

The next financial status indicator is DTI, your debt to income ratio. This is how much of your monthly income goes towards debt every month. Traditionally DTI is based off of your gross income before taxes or any other deductions.

This is one of the factors lenders will assess when you apply for a loan. The higher the percentage the lower your financial fitness and the riskier you look to lenders. For example, you may have heard that only 28% of your monthly income should go towards paying a mortgage. If your mortgage payment alone, without factoring in other debt, is a much higher percent then you are overextended. This means you have too much debt for your income.

You want to keep this percentage for ratio low. You don’t want a lot of your income being eaten up by debt. Remember debt lowers your financial stability and financial security. You want to be able to put as much of your income as possible towards actions that increase your financial fitness, stability, and security. These are things like saving more money and purchasing assets, things that will increase in value over time.

3) Assets and Investments – non-cash assets

This takes us to our third financial status indicator: the amount of assets or investments. Take a look at your non-cash assets. In order to build wealth and have it continue to grow, you need to own things that will be worth more money over time.

These can be things like a small business, real estate, stocks, and bonds. Yes, your business is an asset, when it is profitable. If the business is bringing in enough revenue to generate a profit and is doing well then it is an asset. If you’re building your business and it is currently costing more to run than it is generating revenue, then it is not an asset yet. It is not profitable yet.

So look at your investments and the worth of your assets. Ask yourself if you are building wealth and enough wealth to successfully sustain you in retirement. There are numerous retirement calculators out there where you can determine how much money you need to have saved and invested for retirement based on your current income and estimated lifestyle in retirement or the amount of money you need in retirement.

Just do an Internet search for retirement income calculator and you’ll find a bunch of them. Play around with these calculators and determine your target amount for retirement. Then you’ll have a better idea if you are on track or have of lot of work to do to be financially ready for retirement.

Of course if you’re not on track this decreases your financial fitness and if you are on track to meet your target retirement amount or surpass it then this increases your financial fitness.

Bonus: Net worth – assets minus liabilities

Okay so those are the three financial status indicators that you should definitely review in addition to looking at your checking account and credit score. Now I’m going to discuss a bonus financial status indicator that you likely ever heard of as well, but it’s a really good one.

You should also calculate your net worth. Your net worth is total assets minus liabilities. And liabilities are things that you so think debt.

Your net worth gives a good indicator if you’re moving towards increase financial fitness and wealth building. Of course, you want to decrease liabilities and increase assets. If you have a lot of debt and not many assets then your net worth is negative and you know that you have to work on paying down the debt.

If you have a small but positive net worth then you know you need to work on increasing assets and continuing to stay out of debt or keep the debt low.

If you have a large positive net worth then you’re doing really well and likely have a high level of financial fitness.

Goal-Setting

After looking at these financial status indicators you will have a better picture of your financial fitness. You’ll also have a better idea of what your priority financial goals should be.

You can get a more detailed assessment of your financial fitness by getting a WISE Financial Fitness Score. This score is based on an algorithm I created to take into account not just the typical financial status indicators but behavior and mindset as well.

A shift to a wealth-building mindset and consistent good financial management behavior also speaks to financial fitness. You can get a free WISE Financial Fitness Score at wisefinancialfitness.com. I’ll put a link to the assessment in the show notes.

Alright Success Rebels, good luck determining your financial fitness and designing powerful financial goals. Until next time.

Thanks for Listening

If you have any comments or questions about this episode, leave a comment below. If you liked what you heard subscribe on iTunes, Stitcher, or wherever you listen to podcasts and rate it. This helps the podcast show up for others.

The post POM058: Determine Your Financial Status to Make Strong Goals appeared first on Pocket of Money, LLC.

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It’s time. The podcast will be back in action. After a hiatus, we’re back with all new content for your financial success journey. Stay tuned.

Episode Transcript

Wow, it’s been a year and a half since the last Pocket of Money Podcast episode. It seems surreal that it’s been that long, but I had a good reason.

In full transparency, I felt the message I wanted to convey was getting a little lost and I wasn’t serving as much were in the way that I wanted to serve. I felt I wasn’t bringing a unique and helpful enough perspective. So I took a pause to gain clarity what would be best in helping you with your financial success journey, the your side hustle or business journey.

As 2020 became crazy for all of us, and very difficult for a lot of people, I knew that needed to get myself together and finish revamping the podcast to be able to continue sharing information and resources.

Well after my hiatus of a year and a half, the podcast is back and I will be sharing episodes once a week. We will still be discussing making money and managing money topics. I only say making money and managing money are two separate skills and the each have to work on both.

I’ve seen and spoken with a number of professionals and entrepreneurs who make multiple six figures but don’t have enough money saved to cover one month of expenses. Current events show why this is problematic whether you’re an employed professional or an entrepreneur.

Also, we’ve seen of the importance of multiple streams of income through investing, side hustles, and entrepreneurship.

I want to pass along information and resources that will help you maintain and accelerate your financial success journey. While financial success may look different for each of us, meaning what we are able to do, how much money we have, who we are with … we can discuss the different paths to reach financial success and share with one another tips to get there.

I’m really looking forward to sharing and discussing financial freedom and entrepreneurship with you. Look out for the first real episode to be released on January 5, 2021.

If you have a question or topic that you would like discussed, then send an email over to [email protected].

Thanks for Listening

If you have any comments or questions about this episode, leave a comment below. If you liked what you heard subscribe on iTunes and rate it. This helps the podcast show up for others.

The post POM057: Pocket of Money Podcast is Back appeared first on Pocket of Money, LLC.

In this episode, Sarah Olivieri explains key misconceptions and obstacles when starting and running a nonprofit. She explains what truly needs to be done in order to raise funds for your nonprofit. We discuss:

• the biggest misconception about nonprofits
• key differences between for-profit and nonprofit
• the best fundraising strategy and why events are it
• how to attract funds
• how to engage with donors in the digital age
• the type of events that actually work for fundraising will digital methods to fundraise

Sarah Olivieri

Sarah Olivieri is a nonprofit strategist with a passion for helping organizations thrive in the digital age. The founder of PivotGround, Sarah helps human-service nonprofits increase capacity, deliver better programming, attract more funding, and make the world a better place. She is the creator of the Impact Method – a business framework for nonprofits designed to help nonprofits thrive in the digital age. She has over 15 years of nonprofit leadership. Sarah co-founded the Open Center for Autism and was the executive director of the Helping Children of War Foundation. She is also a published author whom co-wrote Lesson Planning a la Carte: Integrated Planning for Students with Special Needs.

Resources Mentioned

Executive Director Coaching Program – program offered by Pivot Ground to optimize and organize startup nonprofits and small nonprofits. Fill out the contact form and ask about the program.

Thanks for Listening

If you have any comments or questions about this episode, leave a comment below. If you liked what you heard subscribe on iTunes and rate it. This helps the podcast show up for others.

The post POM056: The Hard Truth to Running a Successful Nonprofit in the Digital Age with Sarah Olivieri appeared first on Pocket of Money, LLC.

If your business is not making money, you to adjust your strategy. There may be something wrong with your product/service, pricing, sales funnel, marketing, or…

The post POM055: Street Smart to Successful Entrepreneur with Tom Libelt appeared first on Pocket of Money, LLC.