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Summary:
Why do you need a budget? With everything going on in the world, it’s more important than ever to know exactly where your money is going and wrestle back some control of our finances. The principles of budgeting apply to both your personal life, as well as your business. We break down 5 reasons why having a budget will help you and then dive into how to apply the principles of budgeting. Then, Natasha O’Banion answers, “How do I see the long term view for my business?”
Main topics:
Why you need a budget
Simple principles
Our major suggestions
Automate saving/investing!
Ask a Biz Coach
Main takeaway: If you want to see what’s actually important to someone, look at their calendar AND their bank account. Setting a budget is you declaring what your priorities in life are and what you’re willing to sacrifice to get there.
Links:
Ep 289: Investing as Business Owner
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A VERY ROUGH TRANSCRIPT OF THE EPISODE
Provided by otter.ai
SUMMARY KEYWORDS
budget, business, money, set, spend, expenses, important, save, dog walker, numbers, income, budgeting, personal, pet, investing, month, pay, minimums, account, talked
SPEAKERS
Meghan, Collin
Meghan 00:10
Hello, I'm Meghan. I'm Collin. And this is Pet Sitter confessional and open and honest discussion about life as a pet sitter. Welcome to Episode 294 94.
Collin 00:22
We're six away from 300 episodes.
Meghan 00:25
Thank you to pet sitters associates and our Patreon members like Beth, Claire, Adriana, Doug, Laura and Ashley, we are very appreciative that you guys listen that you share and that you contribute financially to help support and continue to have this podcast going.
Collin 00:43
If you'd like to become a patreon and support the show, you can go to pet sir confessional.com/support.
Meghan 00:49
And even if you can't, if you aren't in a place where you can financially support right now, that is okay. We if you know of another pet sitter with that would benefit from the knowledge of US and other pet sitters on this podcast, feel free to share any of the episodes with them
Collin 01:05
and invite them to our Facebook group as well. Yeah, it's called sitter
Meghan 01:09
confessionals. Last week in Episode 292, we talked about ways to address inflation and high gas prices and everything we're kind of feeling right now in the economy. And in the past, we've also talked about how to set your prices. So what do these things have in common? Well, you have to know your budget and your numbers, personally and in your business, so that you can do these things. And so again, it's not just your business budget, it's your personal budget as well, it is critical to the health of your finances, and to what you can contribute to your business,
Collin 01:45
and your mental and emotional well being as well.
Meghan 01:49
And so when you start to build the muscles of budgeting, nobody really likes to talk about it. But it is important. When you start to build these muscles in your personal life, it is easier to do in your business, it's easier to translate some of these things that you're learning that you're applying to your personal life into your business. So it sounds really simple. But setting a budget is really telling your money where it's going, instead of wondering where it went. And we really stole that from Dave Ramsey, who we took his financial peace class 10 years ago, right after we got married. Yes, it was actually incredibly helpful. Because it taught us how to be wise with money because we both brought money, not a lot, but a little bit into our marriage. And so we had to say, Okay, now what, what do we want to do with this moving forward for the next 5060 years,
Collin 02:40
I think more important than that, it got us both on the same page of understanding that understanding money is important. And that feeling that that is important to us and our well being both financially, physically and emotionally. It's important to understand what those numbers are. And so really, I think there are basically five big reasons why people need to budget and need to budget more. And the first one is that it keeps you focused on your goals. And there's a saying that if you want to see what's actually important to somebody, look at their calendar, and then look at their bank account. You see, setting a budget is you declaring what your priorities are in life and what you're willing to sacrifice to get there. That's the really important part of a budget is that we are saying yes to some things, which means we are saying no to others, we are setting our priorities and putting $1 figure in front of
Meghan 03:32
it. Well, that sounds a lot like what we do in our business with our goals and our objectives.
Collin 03:37
Budget actually forces you to map out your goals. It forces you to sit down and go, How am I going to get from point A to point B? What is my financial situation going to look like in five years. So it forces you to map that out. It forces you to save money, keep track of your progress, and really turn your dreams into a reality. Because ultimately, whenever you start working through this process of taking the unknown and turning it into a note taking the unknown finances, wondering why you never have money, wondering where it all went, taking that and turning it into something actually it makes it productive for you. And you actually start changing behaviors and patterns in your life.
Meghan 04:18
Well, and I think the biggest thing for me when we do a budget is it helps us make sure we're not spending money on things we don't need. I am an incredibly frugal person. I feel like I would say cheap, but
Collin 04:30
frugal is a nice one. Yeah. You can you know how to really stretch $1 to its fullest. There you go. Which is super important in the in the economic climate that we're in right now, knowing what can this $1 do for me, where should I put this dollar versus somewhere else?
Meghan 04:48
Yeah, because I feel like too many people sometimes are spending money. They don't have on things they don't need and it's to impress people they don't even like, which is also a saying that Dave Ramsey has yeah doing a weekly review of your budget really allows you to compare what you spend versus what you said you would spend to stay on track, you can use a tracking app like mint, we use that for a long time to keep track of everything in one place to see what we were spending how much money we had in our accounts. But it can be especially tricky if you're not tracking the money that you spend on credit cards, because that can really come back to bite you the next month, when you realize that you've actually spent more than you can actually pay back. So I feel like credit cards are a really good thing to have as long as you can pay the balance off every month,
Collin 05:38
getting you're using them wisely and not overspending and not thinking, Oh, I have a $5,000 limit on this credit card. That means my budget has increased by $5,000. It hasn't, you have to pay that back eventually. So it's really important to know that it's important that if you create and stick to a budget, you'll you'll never find yourself in those precarious situations of guessing or wondering, well how much money you have at any given point, because you'll know exactly how much money you have coming in. And you know exactly how much money you can afford to spend each month. And then the third bucket is how much you need to save.
Meghan 06:11
Yeah, saving for emergencies very, very helpful and necessary. Because a pandemic, you're walking a dog and you slip and fall and break your leg. You know, we don't know when we're going to become sick or injured. So emergencies usually arise at the worst possible time, you know, when you're already strapped for cash, but it's exactly why you need an emergency fund. And we did already talk about the importance of having an emergency fund and the context of investing your money on episode 289.
Collin 06:38
And Joshua, that episode really talked about the importance of what an emergency fund does, it sets your mind at ease and gives you peace to go out and take more risk for investing. But in this case, what we're saying is that the emergency fund can put you at ease and give you peace to weather storms as they come. Right now as we are facing high inflation and a potential recession that we may or may not have already entered in depending on who you talk to, we can have a little bit of money on the side that can help push us through some really tough times ahead. And we don't have to panic in those moments. Well, and
Meghan 07:09
it also will ensure that you don't spiral down into a lot of debt after some sort of crisis that you have. And of course, it's going to take time to build up that emergency fund. I think they recommend having a year's worth Yeah,
Collin 07:22
Josh talked about having a year's worth. But basic, you know, start with a month's worth set the goal. Budgeting is a lot about goal setting, as we've already mentioned. So for your emergency fund work to have a month's worth of expenses covered, and then expand that to three months, and then six months and then work out all the way up to a year. And then that just sits there. And that's the worst case scenario, everything. You know, pot hits fan and we need to do something you are you know, you're going to be okay, at least for a little bit. Setting a
Meghan 07:51
budget is also going to uncover any bad spending habits that you didn't realize that you have, oh, it's very uncomfortable. Those subscription boxes or the subscriptions that Amazon has the autoships
Collin 08:05
for things or just under understanding how how many streaming services are you subscribed to? So quick question, How much money did you spend eating out last week? Not that eat. Do you now? Yeah, not that eating out in and of itself is a bad habit. What is a bad habit is not knowing what you spend and not having a plan for that money.
Meghan 08:26
Every dollar has a name, right? Yes, exactly.
Collin 08:28
Every dollar has a name, it's got a job and it nothing surprises you. The thing about a budget is that you set it and then you live by it. The budget is impartial. The budget does not flinch away from the truth when the numbers don't add up. When you say Oh, I'm just gonna spend I'm gonna spend $300 on eating out. And then you sit down and do your budget and you found that you actually spent $1,000, that month eating out. That is painful. So don't be afraid of when these numbers don't quite add up. The important part is that you see it, you recognize it and you set a plan to move forward with it
Meghan 09:01
well, and either two scenarios for that either one, you like eating out that much. So then you need to adjust other areas of your budget to account for the $1,000 that eating out or the other side of Oh, I really need to cut back on the eating out because I actually really only want to spend $300
Collin 09:19
Yeah, oh, I actually have my other priorities we can we talked about priorities. The important part here is going, Oh, I have a priority of actually saving 20% of my income. And I can't do that if I eat out this much. So there's a sacrifice that I have to make for short term, short term pain for long term gain, because you actually start to see and feel when your spending doesn't match up with your goals, which actually encourages some better behaviors to start engaging.
Meghan 09:42
And then finally, setting a budget really helps you sleep at night. In busy seasons or times of turmoil like the pandemic was the you can really lose sleep at night thinking about oh, do I have enough money to cover this or what's going to happen with the future? Or maybe you panic at the grocery To restore because you suddenly don't remember how much is in your bank account and you worry about your card being declined and feeling a little bit embarrassed. A budget doesn't make more money appear in your account, but you know what you have, and you know, you have a plan in place. So it's important to do one, because that means you can take back control over your money, your money doesn't rule you because you have told it where to go. When you budget your money wisely, you will never lose sleep over financial issues again, because you'll know where it's going well,
Collin 10:28
and as a business, it helps us make better decisions. I know when Megan and I when we when we plan, it really helps for us to sit down and see how much money is coming in and how much we're spending so that we can have peace about those decisions that we're making. So that we know Okay, I can't afford to increase my ad spend, or I can't afford to sponsor this or I can't afford to buy those poop bags in the special little containers right now. But I'm going to save that for later kind of helps us rearrange what we can and can't do. And knowing it in concrete numbers really helps with those decisions.
Meghan 11:00
Something in your business that you absolutely need to budget for is insurance. As pet care professionals, your clients trust you to care for their furry family members, and pet sitters Associates is here to help for over 20 years, they've provided 1000s of members with quality pet care insurance. Because you work in the pet care industry, you can take your career to the next level with flexible coverage options, client connections and complete freedom in running your business. Learn why pet sitters Associates is the perfect fit for you and get a free quote today, at pets@llc.com, you can get a discount when joining by clicking membership petsitter confessional and using the discount code confessional at checkout to get $10 off, check out the benefits of membership and insurance once again at petsfit llc.com. And so now we're going to talk about some budgeting basics, we're going to follow a few simple principles. And the first one is to calculate your monthly income. But for solopreneurs, this can be a tough thing to do, because each month tends to be different and crazy. And even if you have staff as well, there are some months that are busier and some months that are a little leaner.
Collin 12:04
Yeah, basically just being an entrepreneur running your own business, it is hard to predict how much money you're going to make. I mean, we've done that even this month alone if we thought we knew what was coming in. And then a couple days ago, we had a massive influx of bookings. And all the last minute Louise lots of lessons that continued to surprise us. And we went okay, well that changes the game or sometimes we think we know what we're gonna get. And you get slammed with a bunch of cancellations. Lots especially going on now with flight cancellations and all sorts of things going on. So basically, if you're going well, I don't know how much to put up my top line budget item, I have no idea how can I predict that? Well, even if you've been in business for three months, three points, three data points makes a trendline. And we can start to make some averages that are actually going to be statistically significant for us. So actually, what I would try and do is take the average of the last six months each time you sit down to do your budget, and then you can start getting an annual understanding of okay, January's tend to do this, the longer you're in business, you can Okay, January's are high for me, maybe they're low for me. But I know February does this and this and you can start to get a general sense of what you're going to have coming through the door.
Meghan 13:11
Because actually be really, if you're into numbers, or even if you're not into numbers, this can really be a fascinating thing to see. Okay, I live in this area. And these are the trends. So like where we live, we have a state fair that goes on every single year in August. Yep. And so we know that people coming in and wanting certain services, we know that August for us will be a little bit of an abnormal increase in demand, even though you know, kids are starting to go back to school and parents, you know, teachers and everybody's going back to work, but we still see an increase because of the State Fair.
Collin 13:45
Yep. And that comes from a lot of questions. When you ask a new intake forms. How'd you hear about us? That simple question is so powerful for you, because then you can start budgeting around that fact. Okay, the State Fair is in August, I know that our budget is going to go up. And what does that mean for us, I can save more, I can also spend more my business if I need to, maybe that's the month that I buy shirts, because I know I'm going to have a little extra cash to do that for the team. Or maybe it's I said a little bit more aside to weather a storm down the line, you make those kinds of decisions, but you have to understand what you have coming through the door to start this entire process. And sometimes just getting some numbers down is better than nothing at all. I know it feels daunting, it can be scary, and you don't want to quote unquote guessed wrong, but the process is what it is important. At the end of the day working through this process of building these muscles, getting an understanding and of how your business operates about where that money goes, how it comes in how it flows through and off to you. That is ultimately what we're after here is just the overall process.
Meghan 14:43
And then you also need to find a system for your budget. The two most common systems are the envelope system or envelope system. Oh no. Envelope starts with an e come on. Now five is an ongoing debate in our house, the envelope system and the zero based budgeting system. So the envelope system is just what it sounds like you put money in an envelope, it's typically cash. And you put that in an envelope. And when it's empty, you can't spend any more money. You can
Collin 15:11
also do this with some more modern banks, you can set aside money in different accounts, sub accounts without having to have set minimums for them. And you can spend out of those, especially if you're doing a lot of online, or you kind of pretty married to your debit card, you can do these things. That way you can release funds as you need it from these little accounts. But yes, in the traditional method, you're taking cash and putting it in an envelope, and what putting it in an envelope. And then, and then importantly, hear when that money's gone, it's gone. And you you move on to something else. And then the second one is the zero based budgeting, and that's the one that most of us are familiar with, of my income minus my expenses should be zero, and you just work through it like that. And it's a way of budgeting of going okay, as this number gets closer and closer to zero, I need to change my spending habits more
Meghan 16:00
drastically. And so part of your expenses would be your savings account, right, exactly
Collin 16:04
the way that definitely is included. Which brings us to the 5030 20 rule. This is a very simple framework to set up just general proportions of what we're supposed to do with our money. So we've calculated what our money our money coming in. Now we've got to figure out what big buckets do we put in. So 50%, again, this is all general, and you have to figure out what's going to work best for you and what you actually need, because especially right now with all the inflation and price is going through the roof, these numbers are going to change a little bit. But in general, what financial people recommend is that you put 50% of your income towards your your needs. These are housing, food, clothing, medical, and I know housing is really bad right now, it used to be recommended that housing shouldn't take up more than 30% of your total income. But that's, that's literally almost impossible these days to control housing to that extent.
Meghan 16:56
And again, this is for a personal budget wet, right? So this is everything coming into your personal account, not your business
Collin 17:01
account. Yeah, exactly. And we've talked a little bit about this on profit first as far as budgeting for your, your business based. And so that's another methodology for your business specifically is profit first, and so you can set what that recommends is that any money you get into the business that for the business, you'd immediately take a little bit off the top to go towards profit that you can reinvest back in later down the line. And then the has a bunch of different ratios in there for how much to set aside for taxes. So again, for business, I've got a budget for how much I need to set aside for my personal taxes that includes 30% Welcome to entrepreneurship, they recommend 30 setting 30% aside, at least over here in the States, I'm not sure about our international listeners, how that works for you talk to a CPA, and even for those in the United States talk with the CPA even after this episode. But taking that money and going okay, I need 30% Here, they also recommend setting something upside as for the business expenses as 30% for expenses 30% of that money you're going to send off to that the business is going to spend this is why we just so recommend having a business account and a personal account. So my business can spend money that I don't have to my business is going to spend money that can write off at the end of the year. If I buy the leashes with the business, that's a tax write off, if I buy those leashes with my personal, that's not so much harder to do. So 30% could set aside for our business expenses. And then what's that leftover, we've got 30% aside for taxes 30 for expenses, that 60% That's what's goes to you. And that's that top lines that 60% That comes from your business income, that 60% That you transfer over into your personal account, that becomes your top line income item for your personal account. You see how these buckets this one fills up with the business than the spillover is that 60% That goes into your personal that starts at your new 100%. And that's the numbers that we're working with and talking about right now.
Meghan 18:50
Because I know a common question is how much do I pay myself. And so you're saving 60% 60%
Collin 18:54
Right. And I know again, this is totally different depending on how much your expenses are, if you have employees, if you have ICs, all that stuff goes into it. But if you are out there and you are a solopreneur you're rocking it, you're killing it, your business is growing, every dime that every penny that your business earns 60% of that, try and make that go to you. So at that point, you have goals, okay, I want 60% of that go to me, that means I need to control my expenses a little bit more. That means I need to maybe try and grow my business a bit more so I can afford these other things as well. It's that's what this process starts to do. When we understand what these proportions are doing for our business. We make changes we make decisions based on them.
Meghan 19:34
So we talked about the 50% of income that goes to your needs, so housing, food, clothing, etc. And then there's also the 30% that goes 30% of your income for once. So this is entertainment going out to eat movies, that sort of thing,
Collin 19:49
all that kind of stuff. Exactly. These are the ones that now this is just again generic form 30% And you as the individual, ultimately decide which you deem a want versus Nice, but we have to be realistic about it. Does this help me survive and thrive? Or is this kind of icing on the cake? Is this something maybe that I will spend money on once I get on a better footing? Or is this something that I have to have in my life right now.
Meghan 20:15
And so the last 20%, there of your income is going into savings and any debt repayments that go above and beyond just the minimums that you need to pay?
Collin 20:24
Exactly. So the debt minimums are included in your needs and the 50% in the 50%, because those are commitments that you have to keep going. And then we every budget through all this, we're left with this 20%, where now I can save or I can double down and start paying more back on my debt repayments. Throughout this entire process. Again, it's the process that's important here. So track and manage through regular check ins. This is crucial. It will it's never a set it and forget it process, especially for us, right since our income as business owners is constantly in flux. And the world is pretty crazy right? Now, we need to be able to make changes as quickly as possible. And to do that we need to have a constant idea of what's coming in and what's going out. You can track in a Google Doc or Google or an Excel file, or an app like Megan mentioned earlier about mint or even there's one called you need a budget YNAB. It's called you need a budget. Oh, that's handy. Exactly. So let's dive into a an example here. And I know everyone loves doing math on a podcast. So we're gonna keep it short and sweet. Yeah, we're gonna stick with a zero based budget, where we are left with $0. After expenses, we're going to start with the business budget. So let's say your business brings in $8,000 a month, it's a pretty big month, right off the bat, you need to set aside 30% for taxes. And then we're going to set aside 30% of that $8,000 for expenses. And I know what you're saying right now you're saying, but I don't I don't have that many expenses. What are you talking about, one of the great things about running a service based business, especially in pet care is that my expenses are are minimal, I don't have a lot of money to spend on those kinds of things. But hear me out on this. What if you took some of that money, and you actually budgeted for sponsoring events, buying amazing gear, getting the best insurance getting the best software or by going with a coach, or whatever it is,
Meghan 22:19
or even just some practical things like your website, or if you have a business line with Google Voice or running Facebook ads,
Collin 22:26
until you set money aside, we won't have that money around to spend on making our business better, and that is so important is that we can and we are able to make our business, do things for the business and invest back into the business, we hear that a lot invest money back into business. What does that mean? It means I take money that the business earns, and I put it back into the business. And I'm only going to be aware enough to do that. If I've budgeted for that if I set aside a little bit of money. And here's the thing that first time you're going to have no idea what you're doing. And you're gonna go I don't know, how much money do I need to set aside for this? I don't know. But go ahead and skim back through some of your personal expenses and see what you were already spending money on there? Are you still paying for Canva out of a personal account? Are you running a website? Are you paying for that out of a personal account, shift that over into the business and start building that into the business budget. So you have those monthly expenses that you know you have to meet for the business side of things?
Meghan 23:21
Well, and we know that some of you listening already do this every single month. And that's great. We're trying to talk to everybody here, whether you're you've never done this sort of thing before you don't have a business account, you've had a business account for a years, you already know all this stuff. Hopefully some of this will be helpful to
Collin 23:37
you. Exactly. And it's always good again to go ahead and reassess some of the basic some of the principles from time to time to make sure you're staying on track. So after we've set aside the 30%, for taxes and the 30%. For our expenses, we're left with about $4,800. That's the 60% left, that is what we're going to transfer over into our personal account, this becomes our top line item for doing our zero based budget. I have $4,800 now for that month, to spend on myself to meet my needs, my wants, and save or pay off debt. Okay,
Meghan 24:10
so 50% of that is 2400 That goes to groceries housing, your electricity, transportation, your own health insurance or auto insurance or whatever you have. And then any minimum loan payments that you have if you have student loan debt or credit card debt, anything beyond the minimum goes into the savings and debt repayment category, the other 20% that we talked about earlier, even if your necessities fall under the 50% cap revisit these fixed expenses occasionally like your cell phone bill, can you get it from a cheaper carrier? Can you shop at a different grocery store like if you're really trying to pinch pennies here, think about some of these things where you can save a little bit money and then the next 30% Or again, this is the personal budget the 5030 20. So the 30% is for your once and again if your needs exceed Get at the 50%, this number will have to be lower. And then the 20%, the remaining goes to saving and investing, and that would be $960.
Collin 25:09
And honestly, this should come pretty high on our priority list our order of operations, here's what we want to get away from. We want to get away from paying everybody else before we pay ourselves. This is a truism that we talked about in the profit first episode, it's a truism when we're going to talk about budgeting for ourselves, it makes no sense for me to pay, make sure everybody else is covered, all of those things are getting covered, if I'm not setting some aside for myself. So in our business, that means that we set profit aside first, and we take that 60% out and we pay ourselves right off the top. And then we have left to finish with the business expenses. setting money aside and putting it into savings, or investing or paying back more of your debt should be very high on our order of operations. Because here's the thing, if we don't put it first, we're never going to get around to it. If I'm always putting money towards my want, I'll never have enough money left over to save at the end of the day, it's very easy to get those things mixed up.
Meghan 26:06
So as we've gone through this, you can start to see how your money can go really fast, which is where we start looking at the inflow and outflow of our money and where it goes, we either make more, or we spend less or both. And so some of our recommendations are first that you automate your saving and investing, we have set investing to automatically happen the first and the 15th of every single month, we literally never see that money, it just disappears. So we never even miss it.
Collin 26:34
Exactly that's important here is as painless as possible. I know what I have left to budget for, after that's already been accounted for.
Meghan 26:42
Because saving investing is very important to us exactly. And then also recognize that change is going to happen. So we have done, we've done budgeting over the past 10 years that we've been married. And it looks literally nothing like our budget today. The budget that we started with 10 years ago is nothing like today, we now have a house, we have kids, we have a whole we have a couple businesses now that we didn't have 10 years ago, and things just look completely different. So that is going to happen anticipate that and it's not scary. It's just it's
Collin 27:12
life, which is why it's so important to do reviews as frequent as possible. There's the weekly reviews that you can do of what did I spend last week, and then you can start thinking of what's coming up this next week, then you can do quarterly reviews at the business level go what how's my business operating? Big annual reviews, what you are constantly in this review process, because you're constantly needing to take in new data, taking that new six month average, look forward to the next six months of expenses and understand how you are operating both at the business and the personal level. These are integrally tied.
Meghan 27:44
And I know we've talked about this before as a solopreneur, or even us, we are incredibly busy as pet sitters, we're doing the six AM's we're doing the nine PMS day in and day out seven days a week, and a lot of us are not taking breaks, we haven't had a day off in a long time. But this is something that is
Collin 28:01
crucial. This will make or break you this really will when you go to for your business and realize there's no money left in your business, because you've been spending it all on some things that you actually are not saving it appropriately or not saving it appropriately. This can make or break you at the personal level when you realize you're at the grocery store and that debit card is declined. And you go Oh, that's right. I, you know, I had $100 in there and I went and I spent it on all this stuff. That's where that went. You don't want to find yourself in those positions. And we understand that times are really hard right now. And things are tough. And when the best things that we can do is start resting back control over our money in our finances and start consciously and very intentionally, that's a very big word here with budget is intentionally placing our money where we want it to go.
Meghan 28:49
And I think the last point here is not to freak out. So we you know, you've set your numbers, and then you see what you're actually doing. If you do this for the first time, and you go, Whoa, I am spending this much and my business is only making this much. It's very hard not to but do not worry or panic, you can change it to the fact that you are doing a budget at all is a very good sign that you want to change things that you want your your finances to be healthy. And just understand that it takes time to change course if you are really off on your numbers. And if you do need some help with that we are willing and able to help colin has made a spreadsheet of everything that you could need in a budget.
Collin 29:33
I don't know about that. But it's worked for us really well. So I have a spreadsheet that basically breaks down expenses out into the major categories so that you can see how much each category bucket is, is taking up in your life. So you'll have all these little individual line items for your budget that are added together in a big category. So you can see oh, wow, my, my my my wants are actually huge compared to my needs. And then we also I also have it linked from my, my business, our business budget down into our personal budget. And you can see as I am able to do more visits, it automatically changes a bunch of numbers on the personal side of things of what we're able to do or how we're able to save or cut back as need be when a lot of cancellation comes in. Okay, we had originally set that budget for $200 eating out, but business is down so that $200 gets deleted and goes to zero. So I have money for other things. And that's what this kind of allows you to do.
Meghan 30:30
So if you are a spreadsheet kind of person who and who
Collin 30:33
isn't happy, tell me. Yeah, no, sorry.
Meghan 30:38
You can send us an email at feedback at petsitter confessional.com. And we will send that over to you. Just as setting a budget is kind of a long term view. Business Coach, Natasha opionion, is going to answer the question, how do I get a long term view of my business?
30:53
I love that. So you want to just start with the word legacy? What is the legacy you want to leave behind in your business? When I started using the word legacy, it really helped me start to work around myself. Because I'm like, I'm doing all this hard work, I'm doing my best to, you know, build the business up, and I'm breaking my back. Sometimes we all know how that feels. But then if I, you know, clock out, what happens to the legacy? What happens to all the hard work that I just put in what happens? You know, when you see those businesses since 1999, since 1936? Well, those are legacy businesses. That means that without the founder, that imprint stays in the community for years to come. So when you're looking at your business, right now, ask yourself the honest question like, am I running a business that can sustain itself beyond me, for generations, for community, after myself? And as we all know, it's a no, if we're only running it by ourselves, it's not going to because as soon as I'm sick, as soon as I'm like, you know, I actually want to change careers, then that's just over. So think long term down the road on how you like all this effort, you're doing all this energy you're putting in what does that mean to you? You know, are you self employed for yourself? Or you're thinking about what your brand means for the long term?
Collin 32:30
And what context are businesses in? Are we a flash in the pan in the grand scheme of the timeline? Or what do I need to have in place right now to be long burn, slow simmer so that I can keep going and you said very, that word sustainable, we look at our work rate, we look at the load that we're carrying, we look at our processes, and I go is this is this sustainable for the next 30 years. And that's a weird when we really start looking at our businesses and 50 year chunks, it's like, very different. It really changes the game from what I'm doing, what I'm writing down how I'm hiring, how I'm presenting myself, if I think, what if what I do right now is impactful? How will it impact 50 years down the line and put some timeframes on that to at least start helping us wrap our brains around what we're building?
33:17
Yeah, give yourself some flexibility. When I first started my dog walking business, I had no interest in doing products. I was like, I'm sorry, MySpace, I'm sorry, MySpace, that's where I am. I'm not product. But now times have changed where I'm like, wow, I actually really like creating products. I really like being able to ship my products to Canada, like, I like that. That makes sense to me if there's a world pandemic the next time because we're covered. So give yourself a little bit of flexibility for your vision. Because if you close yourself out, maybe even how I was once upon a time, then you don't allow your brand to live. Like I am so grateful that I was able to grow a long standing dog walking business, and be able to move that brand into the online space as a brand. It's not like well, we're only dog walkers. Now well, worse is this is a pet brand that's now moving in service space to pet me and it moved without it without a hitch. So give yourself a little bit of wiggle room. Don't make mistakes that I made where I had to completely change my name because it was just only walking focus. And then I had to completely change my logo because it was walking focus. So it didn't even attract the product space. So when you're creating your vision for long term generation legacy, give yourself a little wiggle room. Well maybe I might want to do that. So maybe if I added at like you said adventure hikes what if I wanted to add adventure hikes? You know, I have a client right now who are her brand name is dog walking while she's having an issue because she actually offers off leash adventure hikes for like over 90 minutes and her climb I can't believe that she's a dog walker. She has her city dog walkers. Let's just say Texas, Texas dog walkers. And so she's, she's in a price hikes with $25. dog walkers right now she's aware everyone in my area is like $25 $20, dog walker. But I was like, You're not even a dog walker. You shouldn't get 4955 Because you're doing this adventure heights off leash or training, you know, you're showing them how to adapt in a pack. Like you're a dog trainer at this point. You're Not You shouldn't even be in the $25 because you're not a dog walker. And she, like had this epiphany. She's like, Oh, yeah, I am doing a lot more work. And I'm not getting my what I'm worth. And I said, because you're not your container is not proper. You're in a dog walking container. And you're not even dog walker. You know, but it's happening to all of us as we expand our services. And we're wondering how much we should charge. You write out the value that you can articulate to the client of actually what you do. I mean, she has 910 dogs going out to the beach. I mean, that's clearly not a 30 minute around the block. And she gives them a bath after and you know, she she doesn't lie. Yeah. So you want to be able to articulate the container to the client.
Meghan 36:26
If you would like to join Natasha's monthly membership group, you could do so at automated ceo.com and use the code P S e 20. For 15% off. We thank you very much for listening to this. I know it was not the most exciting episode, but it is necessary and hopefully you learned something.
Collin 36:42
Absolutely. We know it's different for everybody. This is one approach. This is just some principles to start looking at where you're spending money, how you can control it, and what are some things that you can start doing right now to plan for the future. That's all budgeting is doing its planning and getting some goals in mind for you and your business.
Meghan 36:59
Thank you to pet sitters associates and we hope you join us next time. Thank you.
37:02
Bye
