Your money

What do I mean when I say you need to know your numbers?  Let me explain.

You pull out your favourite pair of jeans that you haven’t worn for a while and you can’t quite get the zip up.  No, they haven’t shrunk, you have expanded (put on weight…).  So you decide to do something about it.

Off you go to the gym (or Weight Watchers) and what is the one of first thing that happens?  You get weighed, then the measured and body fat pinchers come out.  At the end of that first session, you know your numbers!

You may not like them, but at least you have established a starting point to improve upon.  You were probably also asked what you would like to achieve so the appropriate plan can be put in place.  You will have picked some more numbers so you know where you want to get to.

It is exactly the same with your money.  You need to know your numbers.  You need to know what comes in, what goes out.  What you own and what you owe (your personal balance sheet).

I am amazed at the number of business owners who don’t know their numbers.  I was talking to a contractor, who told me he was a contractor so he “didn’t have to worry about that sort of thing.”  No wonder he wasn’t where he wanted to be in business or in life.

If you are an employee, it is easier to know your numbers.  You have certainty about what is coming in, you just need to work on the going out bit.  There are plenty of apps and programmes that can help you do that and then put a money plan in place accordingly.

Do you know what you are worth?

Regardless of where your income comes from, this is the difference between what you own and what you owe.  This is a very important number as it is a measure of your wealth.

When you first start out, it is quite possible this number will be negative.  Particularly if you have student loans, credit card debt and not very much on the other side, like a house, car, or retirement savings.  The goal is to get that number into the positive as soon as possible and keep growing it as you add more to what you own and less to what you owe.

For a business owner the calculation is a little more difficult, as you have to do the calculations twice.  Once for your business.  You should have your monthly business profit and loss and cash flow statement at your fingertips, this shows what is coming in and going out.  If you don’t know this, you need to talk to your accountant and start finding out.  Your business will also have a balance sheet of what you own and what you owe and how much of it is yours.

your money

The second time for your personal situation.  How much are you taking out of the business, and where is it going, and what does your personal balance sheet look like?

I have had some very interesting conversations with business owners that go like this:

“My accountant told me my business made $60,000 last year.”

“Great,” I say, “how much do you spend personally?”

Frequently there is a blank look on their faces, they just don’t know.  So we have a look at the numbers and it comes as a shock to them when I tell them they are spending $100,000 on their lifestyle and personal debt.

“How can this be?” they ask.

Then we look at what they own and what they owe and find the savings have gone down and the credit card debt has gone up.  Their wealth has gone backwards to support their lifestyle.


Now they know their numbers, they have a couple of options.

  1.  Reduce their personal spending, or,
  1.  Increase the profit of the business

Which would you choose?

If you don’t know your numbers, you are flying blind (in a financial sense), you can’t move forward unless you know where you are now, and how you are going to get to where you want to be.

If you want to know more about how to work out your own numbers, or need some help interpreting them, feel free to drop us a line.

If you want to know more about your personal numbers, have a look at our Men, Women & Money Programme.  It is designed for couples who want to move ahead financially so that they can build a successful and happy life together.

In this programme, we also look at money in relationships – it is one of the major causes of stress.


Why is it so Easy to Spend Money?

easy to spend money

While this sounds a really simple question, the answer isn’t as straight forward as we would probably like it to be.

This simple question actually has two parts to it.

The first is why do we spend money and the second is what makes it so easy.  So, let’s look at these two components in isolation and put them back together.

The first question: Why do we spend money?

Continue reading

Three Critical Rules of Money Management

coins_2Happy New Year!  We hope that you have had a fantastic time over the Christmas/New Year period and enjoyed a least a few days off.

It’s (late) January, a time for reflection about last year and looking ahead at self-improvement for this year.  Once you have worked through the diet and exercise goals (they always seem to be fairly near the top of my list), there’s the money planning for the year.

Here are the Three Critical Rules of Money Management that you need to incorporate into your planning.

Continue reading

5 tips to help you cope with Money and Depression

Robin_WilliamsIt was with surprise and sadness that we learned of the death of Robin Williams.  How could someone who gave so much to everyone else not realise that he was loved in return?  The answer of course was that insidious illness, Depression.

Then I saw this headline in the NZ Herald “Williams was depressed and broke”.  It was only a few months earlier that Charlotte Dawson also suffering from depression and ‘jobless and penniless’ ended her life as well.  It seems that depression and money problems are a dangerous combination.

I don’t know the details of either’s financial circumstances other than what has been in the media.  But both had been in the situation of earning very good incomes during their careers, they enjoyed the good things in life and were able to be generous to their friends and family.  Then for whatever reason the money stopped flowing and life became even more difficult when combined with depression. Continue reading

Will you have enough money when you want to retire?

A scary question isn’t it.  I meet quite a number of people who don’t want to even think about retiring let alone thinking if they will have enough money when they finally do want to retire.

The answer to the question was the subject of a presentation at a network breakfast I attended.  A certified financial planner used a case study to illustrate the point.

Retirement planning (1024x637)We probably all know this.  We are living longer.  But maybe we hadn’t quite connected the dots in terms of having enough money to retire on.  It wasn’t that long ago that the life expectancy after retirement at age 65 was only 9 years.  Now it can easily be 20 to 30 years, so the number of people potentially outliving their capital is going to be quite significant.

The website My Longevity has gathered data to help you work out your life expectancy based on your lifestyle rather than actuarial data.  It is worth spending a few minutes to complete the questionnaire to see what your life expectancy could possibly be.  I did mine and unless I get hit by a bus, I potentially will need my capital to last until I am 106!!  I certainly don’t have enough to last that long. Continue reading

I’ll be happy when…..

“l’ll be happy when I get the pay rise” or “I’ll be happy when I get a ………”  Just insert whatever the word is for you.  Why do so many of us wait to be happy.  What is wrong with being happy right now?

20140711_063455_LLSDo you know this song?

“If you’re happy and you know, it clap your hands.
If you’re happy and you know, it clap your hands
If you’re happy and you know it and you really want to show it,
If you’re happy and you know it can your hands.”

I think it is about  time we started clapping our hands, instead of looking outside of ourselves and waiting until we have more stuff to make us happy.

We need to stop, take a deep breath, look around and see where we are right now and take pride in our accomplishments to date.

I am not saying there is anything wrong in wanting more things, a nicer house, flash car, but our happiness shouldn’t be delayed until you have them.

So, go for a walk in the park, watch the sunrise.  Tell your partner or children that you love them, start looking inside yourself rather than externally for your happiness.

If you don’t feel happy right now, then every day when you wake up think of one thing you are grateful for, as the list grows, so will your happiness.

If you want to be a little crazy then sing the song and just start clapping.

We love feedback, so please feel free to leave us a comment or contact us.

Lynda Moore



Think like a travel agent when setting your goals

Our bags are packed and we are all set to go.  After months of waiting we are on our way to Sydney to attend Brendon Burchard’s Experts Academy.

20140706_063817 (800x611)We knew where we wanted to go, the date we were leaving and how we were going to get there; so planning for this trip was really quite easy.

Other times when we travel, we are more fluid.  We have a departure date and a date we need to be home and what happens in the middle is totally flexible.  So we decide what to do on a day to day basis.

Goal setting is like that, sometimes you have a short sharp goal that you just need to get stuck in and achieve.  Maybe saving for that unexpected large dentist bill or setting up your emergency fund.

Your goal may go something like this “I want $1,000 in a savings account for emergencies in 90 days from today”.  That ticks all the boxes in terms of being a clear, measurable and attainable goal.

But if you are 25 and you have a goal to have enough money to retire on when you are 65, you will need a bit more flexibility in your planning, by turning your large goal into smaller measurable and attainable chunks.

So, when you are setting your goals.  Think like a travel agent

  1. Where are you now?
  1.  Where do you want to go?
  1. How are you going to get there?
  1. When do you want to arrive?

We love to hear from you, so please leave us a comment or to learn more about our programmes, feel free to  contact us. 

Lynda Moore