Your financial records will never make sense if you mix your personal finances with the business finances. It would be better to pay yourself a paycheck and live off that paycheck by Gary Shotton #000236
By Gary Shotton
Hello, my name is Gary Shotton and I am here on behalf of “Inspiring Better Business”. I am just excited to be talking with you. I hope these are helpful we are just excited to be a part of your life in the business world today. We are going to talk about an answer a question that was commonly asked when, we call in to our peer groups in East Africa. Point Blank we were asked how we can keep our personal money separate from our business money. Is it important to keep it separate and I am telling you “yes”, it is very important to keep it separate? Your business money and your personal money, but I also tell you it is very difficult unless you create in your mind and you are convinced you must do that. It will never happen, and you are going to find yourself in big-time trouble well let us get started well in any business you know. We must first have done enough work what I call the investigation stage and you have got to do that on your own. You have got to do that without any borrowed money you have got to do that in your part time, and you really need you to have a form of income like working for someone else while you are doing the investigation. Stage of your business too many people are unemployed or do not have income and they think man.
If I can just start a business, I will make money well that making money comes later it sometimes comes months later after you start. So, in my opinion must figure out how to make personal income not as a part of your business. In the United States if we are going to have someone that was going to borrow money at the bank and it was a little bit new to the person, the bank’s a little bit unsure they would ask the question. Is your spouse going to continue working and how good a job do they have while you are starting this business here is what the bank are saying, I need somebody to make sure there’s money to pay the day-to-day? Bills of their normal household the kid’s food the shoes for the kids the transportation though the gas to go to the grocery store the basic grocery source. It is not fair for your business to try to may take that on from day one so it sounds tough, but will you say well there is no jobs you figure out how to get a job you be terminal. Make money we have had ideas like go to the college and go door-to-door and an offer to wash student’s clothes.
I have heard there’s money at colleges where people will pay you to wash their clothes. I think there’s ways of mowing somebody’s grass, there is some something you have got to do to create your income from your household before you can think about keeping your money separate from your business. Because what is going to happen is you have got your business money over here and you have a personal household need. I mean a real pressing need and what are you going to do well it is too tempting it is just almost impossible to hold off and not use that business money now. When your start up and running and you have your business you have got to put that money in a separate account you. Cannot commingle in my opinion like if you want to use envelopes or have a bank account, or I have checking accounts and so I have totally separate accounts from our household budget from my business. You have got to think about it this way even though you own your business, and you are the owner of your business you must take a paycheck you have to pay a regular pay out of the business related to what you have put into the business on your time and effort that week or month.
So, you’re paying yourself like you are an employee because you are an employee, and you pay yourself and you live off. What you are pay yourself just like everyone else that is working for you, see then you can talk about separating the two you can talk about now. This is my household budget this is my household uncle income. This is my household envelope and if you are getting started take envelopes and when you do a job. You say well I’m going out of this job I’m going to take this amount of money and put it over into an envelope and say this is for my household and then one way or another you’ve got to live off of that household money and if you can’t you might need to pick up and continue washing the clothes of the college or mowing the grass continue doing what you need to do for your household it’s sort of like planting a seed in a garden and you know you’re kind of hungry and you see it cropping up and you go out and root up the seed and you try to harvest before it’s ripe you can’t do that to your business and succeed well I told you I tell a story and this is a real story that’s happened multiple times in the kind of embarrassing about what the Americans have done wrong in not understanding this.
We have people that are our good-hearted people, want to help and I’ve this proposal several times. Heard about it they said why do not we teach our foreign people maybe East Africa or wherever and they should learn that rabbits multiply real fast and they are tasty to eat tastes like chicken. we will investigate starting the business does not chicken but rabbit food oh that is pretty good and so the Americans or the foreigners. I will say it that way we will say well check out how much would it cost for a couple rabbits a male and a female for sure. Because we want to breed rabbits and we want to have there’s multiple rabbits come off one litter and it they grow fast. And we can feed them we will just help you get started in the rabbit business and it is reported back from East Africa what that cost would be, and the Americans say, well that is not much why do not we go ahead and start with like 30 pairs of rabbits 30 males and 30 females and that way we are really starting a good business. But I have that way how much money would it cost to feed those because you know it is going to take a while to get up. And it is going to take a while to they grow, and they are going to they are going to be eating something.
Until you get to the you cannot eat your first rabbits you have got to let them grow a couple cycles. So, we will give you enough food for that and they give that number, and you know these Americans are they have a way to fly our money and they say here is the money. We are now help those African East African or African young people get in business they are reporting to everybody around town. How they are helping one big mistake they did not understand the culture, they did not understand that the people doing the rabbit business probably do not have money for their personal use. You see where they get mixed up here is the business side the people lending the money or giving the money are thinking just to the business side, but you have got to think we all got to think of the personal side how are we going to pay the person. Or how is a person going to make money until they get up until the businesses up and running well here is what happens the people from foreign land go away the money’s in the pocket of the of the of the developing nation and everything seems to be fi/ne until somebody working in Africa.
Gets hungry and they are hungry, their kids are hungry, and they think you know we got this fat rabbit I know it is a business but I’m going to co-mingle I’m going to take money out of I’m going to take a rabbit out of my business and use it for my personal. That happens and that happens repeatedly and soon about a year later that people from America check in and say how is the business going, and the Africans are very embarrassed. Because they said you know we ate the rabbits and they decide in America go what in the world of those guys do, do not they know that is a business no it is the Americans fault. I look the Americans in the eye and say are you stupid you set them up to fail you did not think of this all the way through you needed to have a plan to start small not big. Grow step by step let them make it on their own as they go, and you are going to have more success and then we are going to have a happy people on both sides of the ocean.
I hope you see what I am talking about I am serious about this. We have got a train our developing nations how to make money not how to solicit money from abroad, and how to do it slow step by step foundational. It does a lot of times involve mixing or dealing with personal money, along with your business money and you have got to keep them separate. If you do not keep them separate you do not know where you are in the business. And you do not know where you are at in the household, everybody is going to be frustrated well. I hope this helps I am happy with all that I am doing I am not upset and upset man I love helping people start and grow businesses. I hope it is happening we are seeing it happening in our peer mentoring groups jump on board if you can thank you.
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