One of the defining moments that shaped my career was taking my first accounting class in university. I hated it. I knew it was something I was going to avoid at all costs, for as long as I could. I immediately switched out of my business major, and studied for a communications degree instead.
For a long time in my small business, I just avoided looking at the numbers. I simply put receipts and expenses in a box, printed out all my invoices and handed them over to my accountant once a year. No worries!
The problem with that system is that I never really knew where things stood. Sure, I knew how much monthly revenue was coming in and the big expenses like paying contractors who worked for me.
But I never really knew the big picture of where the business was going and more importantly, how it could affect my lifestyle. Knowing where my business stood financially would have made it easier to decide when to launch a new product or service, when to take a new client on and when I could ease up and say no to opportunities that came my way. I had no financial roadmap to follow and more importantly, I wanted my business goals to truly support my lifestyle.
Many years later, I still hand a paper trail every year to my accountant. I’m just not wired to input every expense into online tools like Freshbooks, no matter how simple they make it. Instead, I have a customized Excel spreadsheet that works for what I would like to know. If you hate numbers like me, consider this type of financial planning to support your personal values and what you truly want in life.