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Transforming Your Money Mindset

Updated: Feb 5, 2022


When we were kids most of us were given stuff by our parents until we were old enough to work. A big motivator to get a job as a kid was that you could buy what you wanted instead of what your parents thought you needed.

My first job was pulling gigantic weeds in Mr. and Mrs. Haas’s yard for $0.50. What did I spend my money on? Candy of course!

I eventually graduated to higher paying jobs. By higher paying, I mean minimum wage jobs. These jobs gave me the ability to buy other useless things as a teen.

Like most teens, I was politely asked to earn my own living at the age of 18. In my case, I attended college. My limited amount of savings was exhausted paying for my first year’s tuition, room, and board… and I was working minimum wage jobs. I learned very quickly to budget my money. I made it through my college years quite lean with a certain amount of student loan debt.

I finally got a real job, but still seemed to have credit card debt, house debt, and a lot of bills that seemed to zap any income. After four years in the work force, I got a sales job and made sales commissions that allowed me to pay down some debt and save a little.

When I left my sales career to start my business, I was scared. I had some money in the bank, and a few well-paying consulting jobs to start… but feared I would run out of money if I didn’t scramble to get more customers and contracts. The high-paying consulting jobs dried up, and I was scrambling to find work.

Fear was a big driver to working long hours and trying to line up enough work for me and my employees. I never wanted to lay anyone off, so I kept a relatively large cash balance in my bank account to carry us through the lean times.

I always thought that this was smart money management. Until one day, I met a business consultant who told me, “You’re running your business like a home budget, not a business.” He was completely right.

You see. As I matured, I treated money very differently based on my circumstances in life. I purchased useless stuff as a kid, because let’s face it that’s what kids do. As an adult, I learned that I had to pay for basic living expenses as boring as they were. When I had a little extra money, I tried to save.

All these actions are “reactionary”. You strive to earn more money because you know on some level, you need it. Running a business with this same mindset is dangerous. This means that you won’t invest in your company until you have amassed enough cash to invest. You’ll be constantly trying to bootstrap your business… never really gaining momentum.

The flip side of this is that you will go into massive credit card and other debt with no plan to get your money back.

You may have heard this statistic before, but it’s worth repeating, “80% of small businesses fail to make it three years.” What’s less known, is the specific cause of failure. According to the Small Business Administration, most businesses fail because they create a product or service that’s not needed. Well, duh!

I’m not going to dig into the exact causes of failure in this podcast. However, I will highlight another statistic, “80% of business owners don’t write a formal business plan.” Wow! Is that a coincidence or do non-planning business owners fail?

My guess is that most business owners who fail to plan, fail. You have a few of those who only plan and fail to act… but planning is an ingredient to succeeding in your business.

You are probably asking, “What does this have to do with Money Mindset?”

To succeed in a serious business venture, you need to create a successful business model that generates cash. This means that you need to write your model down, put your financial forecast in a spreadsheet, and envision how customers will receive value, employees will love working for you and you gain sufficient personal wealth.

You see, a successful business money mindset is not a natural thing. It comes from experienced business owners who learned how to plan, invest and grow a business.

After the business consultant told me that I wasn’t running a real business, we created a five-year plan. I invested in a larger office space, more employees, and expanded into neighboring states. Instead of relying on word-of-mouth and referrals, we had a marketing and sales group to win millions of dollars in contracts. Once I created my own successful business mindset, my company grew its revenues from $500,000 per year to over $10,000,000 per year.

I eventually sold my company to a larger company that was in our same industry. Why? Because that was part of my plan. The plan was to create a strong business that would sell for a specific amount of money that would fund my kid’s education, and an early retirement for my wife and me.


Enough about me. If you’re not yet successful in business, here are the differences between your current mindset and a successful business mindset.

Lesson #1 – Plan. A plan is not going to automatically make you money. All a plan does is create a workable framework for you to grow. You’ll account for all expenses; revenue you’ll earn; and illustrate how much cash you’ll need to fund your plan. If this is your first plan, you’re going to miss some expenses. You’ll eventually learn how to price your goods and services. But you have to start somewhere… so for now, just guess.

Lesson #2 – Exit Plan. You’ll need to start with your end in mind. This is very difficult for most people. Most people think like I thought before I started my business. You think of making a lot of money, the more the better… and are fearful of losing what you have. A successful business owner knows what they want out of life and their business. This knowing creates momentum in a specific direction instead of random greed that serves no one.

Lesson #3 – Invest. Successful business owners understand that there’s risk in making it big. This doesn’t mean that you should be reckless. When you plan, it’s highly likely that you’ll see some negative cashflow periods in your plan. Make sure that you have twice as much investment capital than your lowest dip, and you will be able to invest when the non-investors have pulled back.

Lesson #4 – Separate. You are NOT your business. It’s very common for small business owners to mingle personal and business expenses together. Some do this for tax purposes, and some do it out of inexperience. Your business is legally a separate entity from you for a reason. When you start thinking this way, you can be your business’s creator and builder. It’s much easier to build something separate from you. Otherwise, everything that happens in your business will be personal. And that is a sure recipe for failure. It’s also a way to keep thinking of your business like your home budget…. Which is disastrous.

Lesson #5 – Profit. I don’t know what’s being taught in households or schools these days… but businesses must be profitable. The next time one of my clients says, “I’m not in it for the money.”… I’ll lose it. When I hear this statement, this is what I hear, “I don’t want to be like most business owners who are greedy.”

It’s like a person saying, I’m not living for the oxygen. Here on earth, we have plenty of oxygen… unless you climb one of Colorado’s 14er’s. So, we rarely think about oxygen. However, if you were in space, you’d be constantly aware of your oxygen supply. You’d want to know where the oxygen is and where you can get more if you run out. If you run out of oxygen in space, you’ll die.

If you aren’t planning and thinking about money in your business, you’ll fail. It’s only a matter of time. That said. Profit in business is a byproduct of creating value. You create profit by lowering your expenses and increasing your prices. The value you’re giving your customers the limit on those prices.


That’s it for my lesson today. I hope you’ve learned a few things about Money Mindset. If you’d like to learn more about today’s topic, you can enroll in my Starting Your Business from Scratch training. You can go it alone with my online training; or you can join one of our groups and learn this great stuff in person. The link that describes this program is



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