When people sit down to discuss refinancing a mortgage or maybe costing out the potential return on renovating their kitchen—despite all the math and calculations—don’t they tend to get energized? Of course they do. They get energized because they understand that implicit in these calculations is the opportunity to save thousands on their mortgage or markedly increase the value of their home through renovations. It can be the same with your budget. When you view the money you spend (expenses) as simply the cost of doing business, budgeting remains a chore. However, when you see every dollar spent as an “investment in your future,” you’ll approach budgeting with more excitement and a high level of interest. Budgets can be interesting, and it is time to change your perspective. Your philosophy should be that for every dollar invested in a business expense, you should receive some multiple of that dollar back. Dollar for dollar isn’t enough. Why? If you were to invest a dollar and get only a dollar back, why would you go to the trouble of spending it in the first place? Just keep the dollar and save the time. However, if you can get multiple dollars in return for a dollar investment, then you know you are not spinning your wheels. Every dollar in your business can be accounted for in this way. And when you view budgeting in this manner, where expenses are investments, you’ll get excited and see your budget for the powerful financial-planning tool it is.
THE THREE KEY AREAS
OF
YOUR BUDGET MODEL
When it comes to your Budget Model, you’ll want to concentrate on three areas in particular. First, you’ll want to adopt “Lead with Revenue” as your financial motto. Next, you’ll need to get into
“We analyze our P&L monthly and we have gotten better at controlling our expenses.” David and Judie Crockett Millionaire Real Estate Agents Concord, OH Sales volume—$53 million
the habit of playing the mental Earn a Million
153
