financial goals

Home/Tag: financial goals

Why You Need to Consider Your Hourly Wage As a Business Owner

Have you paused to consider what hourly wage your business pays you? This might not seem important – maybe you think that as long as you have your bills paid, you’re all set.

Why Think About Your Wage?

The thing is, this is really about pricing your products appropriately. First you need to understand your money why, or why you earn the money you take in from your business.  This will help you understand if your current prices can really sustain the goals that you have financially. You can learn how to set informed income goals here. Once you understand what your income target is, you can work backwards and see how much of your product or service you would need to produce and sell in order to make that income. The next step is to see whether that’s realistic. 

The Cost of Low Prices

Look around at what other people in your industry are selling their product for. If you’re giving your goods away because they’re priced so low, you’re not doing anyone any favors. Remember, selling more doesn’t mean you’re necessarily making more. You aren’t making money, you’re reducing the value of what you do in the eyes of the buyers and you’re making your industry fellows unhappy.

Consider Your Time

When you are considering how to price your product you may take into account the cost of supplies, transportation, and other materials. However, you must also take into account the cost of your time. If you were working for someone else and getting paid, you would receive an hourly wage, so consider that just as important in your own business. If you hired someone to help you with production, you’d need to pay them an hourly wage too. If you’re planning to scale up a business you’ll need to be able to hire other people and your prices need to be able to sustain that.

Another thing for product-based businesses to consider when looking at your pricing is your interest in wholesaling. When selling wholesale, you will typically  sell at 50% of your retail price. If, at this price, you’re not covering your costs, labor and making a profit that supports your financial goals, you need to raise your prices. 

I hope these thoughts of mine have helped you consider how taking your hourly wage into account can help you accurately price your products and meet your income goals. If you’re interested in learning and thinking more about pricing formulas, I encourage you to check out my interview with Megan Auman. Our talk, plus my articles on how artists define their own success and how business skills and artistic sense can coexist, are great resources for anyone with a creative business looking to tinker with their profit model. Enjoy!

 

☮

Angela

Photo: JOSHUA COLEMAN

How to Start A Goal-Based Business

How to Start a Goals-Based Business: At Peace With Money

I want everyone to be able to align their business profits with their life goals. But, what does that really mean? You may have all kinds of life goals. Is it really possible to build a business that can help you bring them to fruition? The answer is a resounding yes.

Step One: Dig Deeper

The first step in any intentional process, like designing a business that supports you financially and fulfills you emotionally and spiritually is to spend some time thinking deeply. If you aren’t sure what your goals are, it’s time to figure that out! Envision your life in 5 years, 10 years – where do you want to be? what do you want to be doing? What are you most passionate about? Will starting this business help you get where you want to go?

It’s All Related

To help you think about how your life goals and your business are intertwined, consider this example. Let’s say Sandra is a talented jewelry maker, but she is also deeply passionate about dance. She wants to build a jewelry business that supports her and helps make ends meet. She also wishes to have ample time to attend dance classes, events, and begin performing live. By building up her business so that it runs profitably, efficiently, and provides her with a steady paycheck through the implementation of the Profit First system, she can have more time to put towards her dancing.

Even though Sandra is not choosing to monetize the very thing her personal goals attain to – dancing – she is making more room for it in her life by expanding her business and its capacity to efficiently support her. In this way, her business profits directly support her achievement of her life goals. Some other examples might include building a business that includes a lot of travel if you dream of globetrotting, or creating a business which is founded on ethical principles you’d like to see manifest in the world.

Often, I think we look at business as being a rather sterile aspect of our culture and lives – it’s just the way we make money. In fact, it can be the very opposite. It can be the vehicle for achieving your dreams and visions, whether directly through your business, or via expanding the profits and efficiency of your operations. Starting and running a business is inherently creative – what are you going to create?

If you find you need some guidance in working through the questions I bring up here, I encourage you to reach out. I’m always happy to talk with solopreneurs about how they can achieve their goals through their business. Click right here or on the Services tab up top to learn more about what I offer and how you can schedule a call!

For more reading and resources on this topic, I recommend my article, “What’s Your Money Why?” which touches on some similar subjects and may help you consider these questions more deeply.

Angela

Image Sources: Florian Klauer  Amy Shamblen

Book Review: The One Thing

At Peace With Money: Book Review: The-One-ThingThis summer, I read The One Thing by Gary Keller (no relation), and my initial reaction was irritation. Essentially, the book advises us to focus on one big goal that you want to accomplish and then break that goal down into smaller time chunks.The goal is to do something small to work toward that goal every day. The key is focusing. That’s probably why it irritated me.

Staying focused is definitely something that I struggle with. As a business owner, as a wife and mother, as a person in today’s world of distracting gadgets – focusing is difficult!  It seems there is always a fire to put out, a need to be met. Always there is an idea that is nibbling your brain, or a rabbit hole to dive into and lose 45 minutes of your life. My reaction was about something I need to work on in myself rather than the idea the author presents.  

He also suggests scheduling that focused time into your calendar and protecting it – another challenge for me. On top of that, he debunks the idea of multi-tasking. This felt blasphemous to me at first. What mother do you know who does not pride herself on juggling multiple balls in the air on a daily basis!?! It seemed to me that Gary Keller was basically trying topull the rug out from under my life! This book made me so angry that I had to take a few months to calm down enough to even write this review.

Practical Applications

But somehow, this morning I woke up thinking about this book again. A practical example to apply his basic techniques popped into my mind. Let’s say you want to save $30,000 to buy a house over the next 5 years. That sounds like a lot of money to save and a crazy goal! But if we break it down to saving $6,000 this year and saving $500 each month which means saving about $17 each day, it becomes manageable. To reach this goal, we ask, what’s the one thing we can do today to get that started? Perhaps you open the savings account. Maybe you start a side hustle and allocate all the income to that goal. You might start saving your cash in a money jar to deposit at month end. Maybe you resolve to pack your lunch.

The One Thing Book Review: At Peace With MoneyWhat’s important is getting started by taking some action today to make the goals you have for your future turn into a reality.  That is a lesson I can take from this book.

I might have to work on my focus, and reexamine my views on multitasking. However, I do feel I stand behind the ultimate message of this book: get clear on your goal, focus on it, and work towards it every day. If you do that, you will achieve what you’re after. Whether that’s saving for a house or starting a business, this is an important reminder in how we approach our financial goals. If you need an accountability partner to help you get started, please feel free to reach out.  I would love to help you reach your goals (and I promise not to forbid you from multitasking!)

 

Angela

Image Sources: Squidhub, Bonehead Business