Build Your Business (Part 3): Being Financially Savvy

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Build Your Business (Part 3): Being Financially Savvy

This is part three of a four-part series focused on finding success through building your career online.

Being financially switched on isn’t just an exclusive club reserved for Warren Buffet and that kid from high school who now owns a yacht. Rather, it is an important and essential skill for succeeding in building a career online.

Why? Because now you’re in charge of your own income, meaning that how much you earn is no longer subject to just “rocking up” on time every day, but rather a direct result of how much you choose to work. And this can mean a few things. It can mean how much money hits your bank account next month might not be the same as this month. It can mean your vacation days are as many as you want them to be, but they come at a cost. Or it can merely mean looking after your finances becomes uncannily similar to looking after a tortoise – easy to manage, until you take your eye off them. Being financially savvy means staying on top of your financial situation, which goes hand-in-hand with managing your financial goals.

One of the easiest and most effective ways to manage your financial life, is by setting goals. A financial goal lets you stay focused. It gives you something to aim for. And it prevents you from dropping $8.75 on an instantly disappointing sandwich when you’re less than a block away from your front door (no sandwich can ever beat the quadruple-decker you can whip up from last night’s leftovers anyways). Goals are also great because they can change depending on what the needs of the month are. Your goal may be the same every month – pay rent and keep the dog full and happy. Or it may change from month-to-month – mini vacation in October, Christmas shopping in November. Lastly, a financial goal will help you make sense of the small change… 

In our eBook we talk about the Mason jar technique as a smart way to visualize where your money is going. Not only is it smart because Mason jars are free when you buy some jam and therefore financially friendly, but when it comes to big numbers and obscure calculations, very few of us are good at staying on top of them.

Let’s take an example to illustrate. If you’re earning $11 per class you teach online, how many classes do you need to teach to reach your goal of $561 in monthly student loan repayments? The problem is that multiplication with 11 is all fine and dandy… till you reach 99 that is. The Mason jar method means you can identify how much you’re able to make per hour, and break down your goals into increments of that amount. Bite-sized and manageable. Like this:

  • Draw a mason jar (no need to make it 3D, this isn’t art class)
  • Divide it up into 100 small blocks
  • Assign each block a value (in our case let’s say $11 – for each class we teach)

Now (and still having to use a calculator) we can calculate that we need 51 “blocks” to hit that goal of $561. Mark off the 51st block in your Mason jar and every time you teach a class, fill in a block. Suddenly you’re working towards a goal you can actually see! This is but one method of visualizing how each individual class is working towards a greater goal and it’ll keep you more focused and motivated to hit your target.

This is a simple example, but remember that in the world of remote work, financial reward is directly proportional to the amount of effort you put in. Actively managing how much you make is just one half of the equation, the other half is making sure you put it to good use!

So to sum up, being financially savvy doesn’t require a degree in whatever Jeff Bezos studied in college. It’s simply being aware of your financial situation, and actively making an effort to ensure you’re not throwing all that effort down the drain. You are working for a reason, so be sure to keep that reason front and center and you’ll be golden.

Check out our other blogs on building your business: Creating Work-Life Balance and Work From Anywhere.