Do you have the mindset of a financially successful person? And does that translate into financial success for your business? Accumulating copious amounts of assets are only a small piece of having sustainable wealth. Mindset is another piece of the puzzle.
In fact, personal financial success and business financial success aren’t a whole lot different. It comes down to a way of thinking that holds true in the success of both spaces.
Below are a few of my favorite traits of successfully minded people.
They protect their time You’ve heard the phrase used by or about a small business owner wearing “all the hats.” There is a point in the infancy of a small business that this may be the situation out of necessity. However, financially wise people understand that they can’t and shouldn't do it all. They have the ability and the understanding of the value of relinquishing control of aspects of their businesses. They know where their time is used best and when it makes sense to hire someone to do the things they prefer not to do. They also can be honest with themselves about their strengths as a business owner.
They understand that short-term profitability doesn’t always equate to success Business may be taking off, but during times of transition profits may be low. Matt Rissell, CEO referenced this when he said: "a new or rapidly growing company will burn through cash--fast." While profitability is the goal, it can take some time. Instead, keep track and gain an understanding of your company's financials. Measure growth over time and use prior period comparisons to understand these changes over time.
They choose value over savings A good example of this is proposals for outsourcing. The cheapest quote is not always the best. While a low cost proposal may seem like a good way to save money, a poorly serviced contract may actually cost you more time and consequently money in the long run. They know this service quality plays a part in the growth of their business. They assign a dollar amount to the value of the outcome of the contract, versus placing a dollar amount on the duties of the contract.
They are fact-based thinkers Business and the economy ebb and flow seasonally and often together. People fall into the trap of being jolted by negative news and sometimes get discouraged. Financially smart people stay informed, but they keep their objectives at the forefront of their thinking. They understand that financial success is a long-term game. They know those big decisions aren’t made quickly nor on feelings or luck.
They learn from their mistakes We all make mistakes. It's a fact. Even if you're like me and you have to dig deep to admit it. But like in other parts of life, accept it, move forward, take the experience and apply it later to make better and more informed decisions. Assigning blame takes energy and allows negativity to take over. Protecting your time also means protecting your energy. Blame can be an energy drain.
I’d love to hear some of your favorite advice. Interested in more form L.A. Financial Management? Follow me on Twitter @LAFinancialMGT