Your Team and Your Money Where the Rubber Meets the Road!

Transcription

1 Debra Russell Certified Business Coach for the Creative Professional and the Professionally Creative Twitter Your Team and Your Money Where the Rubber Meets the Road! 2 nd Most Important System Time & Money affect everything Building the system allows money to flow If you push it away... What s Broken Around Money? Disempowering Beliefs Societal/Cultural Taboos Lack of Knowledge/Skills Avoidance Perceived lack of access Internal Assessment What are your beliefs about money? STARTING POINT ASSESSMENT What do you bring to the table to accomplish this goal? debra@artists-edge.com 1

2 What Are Your Beliefs About Money? Meisner Technique Money is People with Money are If I had Money, I d My Mother thought Money was My Father thought Money was What s Working / Not Working Bullet Point List what is working for you or not working for you around money? Working list longer What are you doing/not doing? Qualities / Skills / Talents Qualities = your personality traits Talents = what you re born with Skills = What you ve learned or developed over time. External Assessment Don t make it up Go back as far as you can Knowledge is power and The truth will set you free What s currently in Place What are your real Numbers? Assets & Liabilities Assets = What You Own Liabilities = What you Owe Assets Liabilities = Net Worth Debt Report This will enable you to make a plan 6 Columns Creditor (bank/company/person) Line of Credit Current Balance APR (and any special details) Minimum Monthly Payment Amount paid each month debra@artists-edge.com 2

3 What s Already In Place? What accounts do you have? Checking Savings Retirement Insurance Do you separate personal from business? Bill Payment systems? Financial Records? Create Categories Money Log Separate Business & Personal Expenses vs. Transfers Enables you to use real numbers for budgeting Look for trends, patterns, surprises Record income and expense every penny EXPLORE ALL THE WAYS TO GET THERE What are the pieces of your System? Plan for shifting your mindset Budget both current and vision Structures for day-to-day Money Management Money disbursement Bill Paying Tracking spending and budget Plan for Improvement Increasing income Decreasing expense What Do You Need to Know/Learn? Research: Banks and Credit Cards Credit Score what s yours? Money Mindset Software Options MAKE IT HAPPEN Learn: Financial Management Software Bookkeeping and Budgeting Basics debra@artists-edge.com 3

4 Craft & Implement the Plan Work on one piece at a time Create the plan for one structure and implement Get Support Make sure your family is on board The Budget / Spending Plan Use real numbers as far back as you can Include everything No such thing as Miscellaneous How to Handle the Budget Busters What to do if it doesn t balance How to Use Your Budget Envelope Method Holding Method Monthly report and comparison What did you expect? What actually happened? What can you learn? How do you apply that? Create Your Foundation Set-up Money Management Systems Bill Payment Process Paperwork and Filing Accounting Systems Savings: 6-9 months of basic living Saving for specific items (home, car, children s college, vacations, etc.) Investment: Retirement Financial Freedom Improve Your Credit Score Correct any errors on your report Pay all bills on time Debt Repayment Plan Restructure debt Pay off one card at a time Business Finance A business Owner s Guide to Profit debra@artists-edge.com 4

5 Disclaimer The Time for Money Trap I am not a lawyer or accountant This is not meant as specific advice for your business Always check with your lawyer or accountant. Tapping Into Geometric Expansion It s not something for nothing Money is Energy By expanding your business you serve the world BUSINESS STRUCTURE Sole Proprietorship Easiest to set up Most highly taxed Most vulnerable to liabilities DBA, can use your own SS# The default business structure. Partnership 2 or more parties Needs an EIN Needs a WRITTEN Partnership Agreement Partnership tax filing Pass Through Income debra@artists-edge.com 5

6 LLC Limited Liability Company It is a liability umbrella only Taxation according to structure sole proprietorship, partnership, etc. Sole Proprietor is somewhat less protected Incorporation Corporation is a Taxable Entity S-Corporation All income is taxed as dividends whether or not they re distributed Fewer than 100 shareholders C-Corporation Taxed as a separate business entity Income is either dividend or W-2 Tax Consequences Sole Proprietorship/Partnership/LLC Owner s Draw / Pass Through 1099 Self-Employment or 1065 Partnership Income Schedule C for business deductions Corporation W-2 Salary / Dividends / 1040 Tax form Double taxation SEPARATE BUSINESS FROM PERSONAL Why? Clarity Know Your Numbers Decision Making Looking like a business to the IRS Good Professional Practices What Do You Need? Checking Account Savings Accounts Credit/Debit Card Way to accept payments Budget Bookkeeping System debra@artists-edge.com 6

7 Analysis Where are you making money? Where are you losing money? Which markets are profitable? CREATING A BUSINESS BUDGET Which products are profitable? 3 Sections 1. Income 2. Operations Expense 3. Marketing Expense Income Income from Goods & Services COGS Total Income COGS = Gross Income (AKA Gross Margin, Gross Profit) Business Expense vs. Tax Deductible Business expense is any money you spend to run your business BUSINESS EXPENSES Tax status shouldn t determine cash decisions What s deductible depends on your business structure debra@artists-edge.com 7

8 Expense Tracking & Documentation Track everything, including cash Keep receipts for everything Notes on Receipts and In Calendar Keep accurate books Keep actual business miles If you can t prove it, don t deduct it Deductible Meals When meeting for business purposes. While traveling requiring an overnight stay Meals are usually only 50% deductible Deductible Travel Commute is NOT deductible Deductible Travel: Travel during the day for business purposes Travel between home and temp work location if home is primary place of business The Budget / Spending Plan Use real numbers as far back as you can Include everything No such thing as Miscellaneous How to Handle the Budget Busters What to do if it doesn t balance GOOD DEBT VS. BAD DEBT OPM Good Debt The source of debt is irrelevant An Investment in Yourself or Your Business. Education Capital Investment or expenditure COGS Real Property Income Producing Investment debra@artists-edge.com 8

9 Bad Debt Anything that does nothing to add to the value of your business Consumables Costs of doing business Any Good Debt without a plan to service that debt ARE YOU READY FOR THE BIG TIME? Setting Up Systems LUCK = PREPAREDNESS + OPPORTUNITY Don t wait to need the system Design your systems now for the business you want to have Accounting Software! Once set up will save tons of time Download transactions Delegate to accountant or Bookkeeper Computer or Cloud Quicken (or Mint) QuickBooks (or QuickBooks online) YNAB Wave Xero Educated Business Decisions Your system must answer: Where are you making money? Where are you bleeding money? Comparison over time and is your business cyclical? Evaluate opportunities Create real world budgets based on real cost analysis debra@artists-edge.com 9

10 Dealing with a Cyclical Business 3 Steps: 1. Track your monthly income to see cycle 2. Know your break even 3. Create Savings account just for overflow All overflow must be stored until you have enough to cover low months. CREATE AND MAINTAIN YOUR TEAM What s Broken With Teams? Poor Management Reliability Unclear responsibilities and job Turnover Trust issues Why do you Want a Team? 80:20 Rule Your Core Genius Create an upward trajectory Do what you don t know how to do Do the things that aren t the best use of your time Members of Your Team CEO Create and hold the vision Coach/Mentor COO Manager Lawyer Tour management CFO CPA and Bookkeeper Team Members (Cont.) CMO Agent/Manager PR/Marketing Web Designer Social Media Manager debra@artists-edge.com 10

11 Departments/5 Hats Creative Sales/Marketing Administrative/HR Fulfillment 3 KINDS OF TEAM MEMBERS Vision and Planning Experts Costs More Money / less time Paying for their expertise Includes: Lawyers CPA PR/Marketing Web Design Coach Agents/Managers Employees / I.C. Pay less / More supervision time Need to plan for turnover If they create system, make sure they document it Job description / skills needed OK to trade but be really clear Volunteers, Interns, Family Reimburse for expenses Feed them Ask for help - but respect their time HOW TO BUILD YOUR TEAM It must be OK for them to say No. Turnover is guaranteed debra@artists-edge.com 11

12 Step 1 - Brainstorm List of all the tasks NOT in your core genius List of all the tasks that aren't getting done List of all the tasks you hate Step 2 Evaluate and Describe What is the essence of this task Does this task require an expert? Employee? Volunteer? What department is it in? What other tasks does it go with? Create a job description Step 3 Fill the Opening Ask for expert recommendations Create a listing for Craig s List Contact your local High School or College for interns Ask your fanbase, family and friends for volunteers Interview and test people The more $$, the less you should need to train How do You Delegate Create accountability systems Be specific on what you want by when Follow up and ask for result THE BIGGEST MISTAKE AND HOW TO AVOID IT They work for you Be the CEO Be gracious AND stand up for yourself Enroll them in your vision Be clear about your boundaries You teach people how to treat you. Don t hold on too long debra@artists-edge.com 12

13 Debra Russell Certified Business Coach for the Creative Professional and the Professionally Creative Twitter debra@artists-edge.com 13