If you’re an executive who has become an entrepreneur in the last few years, you will relate to this post. If you are thinking of giving up your pinstripe suit, you’ll want to read this closely.
Once you become an entrepreneur your relationship with money changes dramatically. Back in my executive days I had a very impersonal relationship with money. My paychecks and commission checks were direct-deposited. I never opened the stubs the company handed out twice a month, and never checked to see if my commissions were accurate. They were large numbers, and that was nice. Every two weeks for the paycheck, every month for the commission check. Predictable. Never changing.
Fast-forward. I am in business. No paycheck. No commission check. Bank balance going down instead of up as I spend wildly on–I mean, invest in–my new business. At first I spend as if my paychecks and commission checks will somehow keep coming even though I am no longer employed. Just out of momentum.
After a while a funny thing happened. I started to notice how very beautiful $20 bills are, especially when there are a bunch of them all together in a nice pile. What craftsmanship, what art! Why, that’s Andrew Jackson on the front. A great president, got a bit of a bum wrap after the war. I started to think I’d like to hold on to my Andys a while longer. Andy, what do ya say we cook dinner tonight instead of going out? Name your dish. Beef stew? I make a great beef stew! What wine do you want to go with that, Andy? What’s that you say? A $7 bottle is often as good as a $14 bottle? Can’t be…well, if you say so. HEY! You know, this ain’t bad! Say Andy, the kids’ spring vacation is coming up. We usually go to Club Med. Say what? You never heard of Club Med? Maybe we should do what? Stay at home and play games together and do other things close to home to bond as a family? Wow, that’s a 19th century idea, but I guess I can give it a try. Hey Andy, Scrabble is really fun!
Wake up and clip the coupons, people. As an entrepreneur, you need to learn the Zen-like joy that will come from saving money and postponing gratification. When you finally fix that hole in the ceiling and remodel the bathroom, you will admire sheet-rock like you never have before. So here you go, executives who are turning entrepreneurial–the start of a list of ways to improve your relationship with money. (More will be coming in future posts.)
1. Have a Money Buddy: Before you spend more than $500 on anything for your business or home, consult a buddy. Do you have to spend it today, or can you wait six months? Get a reality check.
2. While You are Spending Less, Work on Making More: Like a Fortune 100 business, your small business can’t cost-cut and save its way to growth. You have to create more sales for the business even as you think frugally. Skip Amazon.com and go to the library (the building with all the books in it–and they let you borrow them for free!) and check out The Secret by Rhonda Byrne. If Rhonda were an ice cream flavor she’d be tutti frutti, but she has an important message. While I can’t promise that if you close your eyes and imagine checks arriving in the mail your wishes will be answered, I do think that you can behave in a way that promotes sales even while you are sober about spending. Get the audio tape rather than the book, and listen to it twice. The first time you will be put off by her strange Australian accent and even stranger ideas. The second time (I’ve listened to it about eight times) it starts to have meaning.
3. You Don’t Need to Have it All Right Now: Our front door was a mess. The lock was busted, the paint was chipped all over. I hated the front door! I wanted a new front door. A contractor said we could have one for $6,000. It was really nice in the catalog. A few years ago, new door! Now….a can of paint cost $20 and a locksmith was $200. And you know what, I really like that new color. I love our front door! For the Boomer generation that is used to having it all, it can be a hard turn to fix rather than replace. But try it. That applies to home repair, cars, appliances, any big ticket item. Get just one more year out of them and you will be thinking like an entrepreneur.