Living with less now can be more for later. When you are an entrepreneur you often are the last person in your company to be paid.
Your family must be prepared to sacrifice – vacations, family outings, carnivals, movies, restaurants, many of the extras you probably are accustomed to.
Bills must be paid. Taxes must be filed and paid. There are payrolls to meet. Loans to buy equipment must be paid off. Every extra penny you have should be used to pay down your debt.
Instead of having the satisfaction of owning your own business, many times you will feel overburdened and underpaid. You may wonder why everyone else seems to have money and you don’t.
Say you mortgaged your home to start your business. Of course you will want to pay down that debt sooner than expected by pouring every extra dollar into paying back that mortgage ahead of schedule, leaving you and your family with minimal funds. That is indeed a great sacrifice, yet the business success is that you are paying off a debt.
The tradeoff in that kind of situation is that if you were to put that money into your own pocket instead of paying off the mortgage, the debt would bog you down for a much longer time.
I feel it is much better to work harder and sacrifice in the beginning, say the first three to five years you are in business.
If finances still are a struggle after five years perhaps you should look at ways either to reduce your debt or increase your company’s revenues.
If after those five years you are still not making enough money and your family has made those extreme sacrifices for that length of time, you might want to rethink your objectives and perhaps redirect your energy toward something more profitable.
The ultimate goal of owning your own business is not necessarily making a ton of money. It certainly would be nice; but there is much to be said for developing products or providing services that are not necessarily huge financial successes yet are extremely popular with general public. That is truly success.
You have more freedom when you own your own business. You don’t have to explain why you need to take a day or two off – you just need to make up the money you might lose for those two days.
If you do contract work it will be easier to budget because as long as you have contracts, you will have a pretty good idea how much money will be coming in. The trick is to keep the contracts active and keep booking new work.
If you are selling services your income will be more erratic and your life more stressful so you must keep on top of your marketing all the time.
There might come a time when you need to make “pro” and “con” lists for your endeavor. If the “pros” outweigh the “cons” then you must continue what you are doing and vice versa!
Article © Copyright 2001 Stanley I. Mason. Syndicated by Paradigm News, Inc.
