Math was never my favorite subject. That is, until I started a business. Suddenly numbers and percentages became really important. Tie that in with my OCD and love for organization. (Helloooo, Excel!) My profit & loss spreadsheet is a huge staple in my business and I use it every month to keep track of my income and expenses. I thought I was doing everything right but I was still living paycheck to paycheck. Every year at tax time my pretty little pink spreadsheet told me that I was spending too much on expenses and even my own salary. (!!!) Something had to give. No one starts a business with the goal of living paycheck to paycheck for the next 50 years.
A typical response would be “I need to get more clients fast so that the business can grow and I can make more money!” Right? Not exactly.
A typical business formula looks something like this:
Sales – Expenses = Profit
That’s Business 101, right? Make enough money to pay the bills and hopefully have some left to take home.
But what if it looked like this:
Sales – Profit = Expenses
(Insert mind-blown emoji face here)
Enter: Profit First by Mike Michalowicz.
(My husband and I jokingly refer to him as Mike Mike.)
I read Profit First this past summer and it changed my life in just the first few pages. It was like the first time I read about Dave Ramsay’s debt snowball… a total palm-to-forehead “that makes perfect sense!” moment. (See also: “Why didn’t I think of that?!”)
In just a few days I was at the bank opening multiple accounts, pounding on my calculator and putting notes in a fabulously styled Word doc. Five months later I’m sitting pretty with my business debt almost at $0 and my profits increasing. I have a crystal clear view of where every penny needs to go and at my next quarterly review I’ll be taking home my first bonus.
I even applied the lessons from this book to my personal finances and it is making monthly bill paying so much easier! We limit the amount allowed in our spending account each week and now we have a savings account that is actually growing!
Full disclosure, as embarrassing as it is to say… I’ve been struggling with debt since I was 19 years old. Anytime I came close to paying it all off something big would happen that would require me to rack those credit cards right back up and, even worse, get more cards. But now I have a solid plan and it feels ah-ma-zing to finally be on a strong course to becoming debt free.
Read. This. Book.
It’s funny. It’s blunt. It has real world examples. It’s freaking genius. This isn’t some get rich quick scheme and it’s not another Insta-famous face with perfect hair telling you how to make $100K in your sleep. In fact, it’s quite the opposite. To quote Mike once again, “Profit is not an event, it’s a habit.” Just like Dave Ramsay’s debt snowball, the Profit First system won’t work unless you put in the effort and the commitment. The good news is, once you put the system in place you’ll only have to check in twice a month! (And get you’ll paid twice a month with a bonus each quarter!)
In the last few pages Mike says “I truly believe this book will change the world.” And I believe it.
Mike will be speaking at Imaging USA in Atlanta, Georgia this January! Learn more at ImagingUSA.org. I hope to see you there!