Okay, I know money is a touchy subject for most but let’s get real.
Money is money. It exists. You use it. I use it.
It’s everywhere, so let’s not be weird talking about it.
Good? Read on. 👇
Ever since I started earning my own money, I made it a goal to have a good leeway of cash.
I hated trying to find money to pay my bills. When I was a kid, I was exposed to overdue bills, disconnection notices and promissory notes.
I can still remember how stressful the environment was when these bills came in.
This made be want to be in a situation where when the bills arrived, I am ready to pay.
Back then I dreamt of having at least 1 full month of advanced money stashed, just in case I lose my job or something.
I slowly built that up.
Little did I know, that was called having a “cushion” in business.
When we started ineedamichee, I did the same thing. I told Alla, we need to save up for some “leeway cash”, for months where sales are low.
When I talked to a CFO friend, she agreed! That’s the first thing we need to do.
A good amount for her was 6 months. Digging around the internet, a minimum of 3 months worth of ALL your operational expenses should be the immediate goal.
What’s the benefit of having this, business-wise?
For one, when your sales are low, you don’t need to panic and start firing off your team one after the other.
Two, you can also have a good amount of time creating, launching or re-launching products that actually serve and help your market. Instead of trying to push sales solely for the reason of “I need the revenue, NOW”.
Overall, having a cushion, both personal and in business will give you less worries and stress.
What’s the 1 money tip that you follow?
PS - If you struggle with budgeting your money, I have something you might find useful. Check it here.