The very first thing to address before Quickbooks or bank accounts or tracking receipts is money mindset.
I’ve worked with a lot of business owners over the years and I can tell you that most, if not all, have had some baggage around money.
Oftentimes, it’s money shame. Maybe they’re in debt and they feel ashamed about it. Or maybe they have a tendency to overspend, so they hate looking at their finances because they feel regret.
Other times, it may be a sense of overwhelm that leads to powerlessness. Maybe they just want to hand all their money management over to someone else so they don’t have to think about it. Or maybe one identity they hold is, “I’m not a numbers person.”
And other times, they just don’t care to engage with their money or they don’t’ see the value of it.
All of these feelings get in the way of effectively managing their finances AND their business because the lifeblood of business in a capitalist society is money.
That being said, all of these are also valid feelings. My therapist recently told me, “All your feelings are right, even the ones that are wrong.”
The thing is, most of us never received an education on how to manage our money. I certainly never went through a Finance 101 class. In school, I was never taught how to reconcile my books, or what student debt truly means, or even how to save money for taxes. And yet, we all expect ourselves to know how to do these things and we’re hard on ourselves when we think we fail.
I call this money shame.
Each person’s money shame is a little bit different. Brené Brown makes a helpful distinction between guilt and shame. She says guilt is the feeling that, “I did something bad,” and shame is the feeling that, “I am bad.”
So let’s get one thing out of the way – you are not bad at your finances. You simply haven’t yet learned accurate, effective ways to manage your money.
Next, I want you to do a little writing exercise. Think about what you do know about money and where you learned it. This could be practical stuff like, “My mom taught me how to balance a checkbook,” or it could be emotional stuff like, “My parents taught me not to talk about money because it is a highly personal thing.”
If there are helpful things you’ve learned along the way, write those down too. The idea is to create a list of what you already know. From there you can identify which of those things is actually serving you and which ones you could work on letting go.
It won’t happen overnight, but I’ve seen time and time again that the more people engage with their finances in healthy, purposeful ways, the easier it becomes. And that all starts with their money mindset.
If you’re interested in learning more about money mindset, bookkeeping, and money management, I’m building a course on ALL the things. Sign up for the waitlist here.