How To Make Finance Fun
When taking a course called “Free to Focus” by Michael Hyatt, I noticed a common theme. People consider accounting & finance to be drudgery. Hyatt asks us to separate our activities into four zones. The Desire Zone, Disinterest Zone, Drudgery Zone, and Distractions Zone. I won’t go into details on all the zones but the Drudgery Zone contains activities in which people do not have a passion or proficiency.
I started to wonder why people do not like finance and accounting. All people, families, businesses and any organization that has a bank account need to have proficiency in handling finances. The problem is that apparently many people dislike this subject. I remember working at a business where everyone hated Billing. I remember being excited about Billing because we were able to bill and collect money to support all the exciting things we were doing. Why is there such a dislike?
We should consider finances as an important aspect of our lives. We need food, clothes, and shelter. Most of us also have dreams and adventures and everything requires money. My goal in my business is to figure out a way to make this exciting.
Below are five things you can do that will bring more freedom and excitement to your finances.
1. Avoid Debt
One thing is certain is that debt is stressful, time-consuming, distracting, and really not necessary most of the time. It seems most people think they need debt to launch their business. I realize that more capital can seem like the quick way to grow a business but it isn’t worth it. Debt requires more bills to pay, more reporting to the bank, renewal work, meetings with bankers, phone calls, and emails. I know a few years ago when my wife and I focused on getting rid of debt, it seems like such a burden to get rid of those bills.
I worked on a client recently that I was regularly filling out applications for credit. Not only was this not enjoyable but it was distracting me from solving the problem that was causing the need for credit in the first place.
I am not talking about hiring a robot, although that would be nice. What I mean is making it easy to manage your finances by setting up good systems and processes. I am going to write much more about this in a few weeks. In short, there are proven systems, processes, and templates that save time.
3. Focus on Profit
This might seem like common sense. What I mean is take your profit first out of your business. I am reading a book called “Profit First” that probably should be recommended for anyone who has any type of business. You should first decide how much profit you want to make and move this into a separate bank account. You can then run your business on what is left. I am going to spend more time on this as I work the “Profit First” system for my own business. I know that I have seen this with savings accounts and tithing. We have a tendency to spend what is available so we have to be intentional.
Don’t let being organized scare you. Deep down you know that you want organization. It looks different with everyone. Most people dislike too much chaos. We should not be living in chaos with our finances. If this is where you are, then I can understand why finances and billing paying would be drudgery. Every time you look at your bank account, you are probably surprised and quite possibly frustrated. I plan to dig deeper in future articles and share some quick organization hacks that help me.
5. Keep Learning
I heard the other day that we should spend 3-5% of our income each year on personal development. If you make $100,000 a year, you should be spending $3,000 to $5,000. At first, this seems like a lot of money. I know that when I finished my MBA and passed the CPA exam, I was so relieved. I didn’t want to study or memorize anything again. Obviously, I realized that this would not work. We have to learn to use technology and change our processes to stay current and be relevant. My job is to keep learning and give you some nuggets as I learn them.
Let’s not think of Finances as Drudgery but figure out a way to live a life of freedom. Let money work for us and begin to enjoy reviewing the financial metrics of our business and life. I am not saying to just focus on money and nothing else. Here is an analogy. We all know that we need to eat. We can eat badly without any thought as to what, when, and how much we are eating. If we do that, we get fat, sluggish, and lose freedom and comfort. If we have an organized process to eat at certain times, specific amounts, and be healthy in what we are eating, then we feel much better. We are much more productive and free to live life to the fullest. Why don’t we do the same with our finances?