[00:00:00] Fiona Johnston
Stop sacrificing yourself for the mission. Stop sacrificing yourself for your business. Why are you creating positive impact for everyone except for yourself? Without income, without profit, we are not able to create the positive change that we want to in the world. So I implore you, start paying yourself, babe. Start taking care of yourself, and then you'll be able to create more impact in the world.
Money Secrets Intro
Are you a small business owner who'd love to be making more money while making positive change in the world? You're in the right place, friend. Hi, I'm Fi Johnston, a chartered accountant and money coach obsessed with small business. In The Money Secrets podcast, I share strategies that you can use to make more money without working harder. You'll hear successful small business owners share what they've learned about money and business, and I'll help you to think differently and shift your [00:01:00] perspectives about money so you can grow your business and your impact. My mission is to get more money into the hands of good business owners like you.
Acknowledgement of Contry
This podcast episode was recorded on the lands of the Wurundjeri people of the Kulin Nation, and I'd like to acknowledge them as the traditional owners and custodians of this land and water that I live, work, and play on. I'd like to pay respects to elders both past and present, and note that sovereignty has never been ceded. This always was and always will be Aboriginal and Torres Strait Islander land.
Fi
My name's Fi Johnston, and I am the founder of the Money Secrets Podcast. I am a money coach, a chartered accountant, and a business strategist who has specialized in helping purpose-led business owners to grow profitably for the last 25 years. So when I say that I have seen a lot of [00:02:00] founders sacrificing themselves for the mission, please know that it is true.
I've been working with amazing business owners just like you for 25 years, and I have seen the way that you sacrifice yourself, your financial wellbeing, your physical and mental wellbeing in order to live out the mission of your organization. Now, are you a purpose-led founder who is constantly putting your own salary last on the list?
It might look something like this. Everything's going well. Maybe you have a team, or maybe you're working on your own in your business. You're working towards a mission, so you have some kind of impact goals. Those goals may extend beyond you and your family, or it might be around, you know, "This is the impact that I wanna have on my family [00:03:00] and, and how I wanna show up in the world through my business."
Let's say your revenue starts decreasing. So something happens, you lose a client, or, you know, there's a change in policy and you lose some funding. Maybe it's that it's a quiet time in your business. That could be another scenario. And if your first thought is, "That's okay, I'll reduce the amount that I'm paying myself, and that's how we'll get through," is that you?
Is that something that you are doing in your business? Because if so, you are doing something that a lot of other founders do, too, and I wanna call it out today. I wanna start by saying that you are a purpose-led founder, and that's awesome It really has meaning for you to be a purpose-led or an impact-driven founder.
And the thing is, small businesses and social enterprises create so much positive change in the [00:04:00] world, and that does deserve celebration. It's not easy to create impact in the world. But as the founder, you need to take care of yourself, too. You need to think about yourself as the first person impacted by your business, by your organization, and by the financial decisions that you are making.
You are the person impacted the most by your business. You need a healthy wage, and your business also needs a healthy profit. So if this scenario sounds familiar, that your salary is generally the one that is sacrificed in order to keep your business going, I want you to consider putting yourself into a different position in your business.
And I would like you to consider yourself as the most important payment to come out of your business. I know this is a really big change for a lot of you, but I want you to see [00:05:00] yourself as the first person who gets paid from your business, not the last. This is a mindset shift. It's also a practical shift.
When you're paying things out of the business bank account, pay yourself first, and then use what is left to pay the other bills in your organization. If you are constantly reducing your take-home pay, your salary, to get through difficult financial patches in your business, I promise you, you are going to be resentful in the future.
Future you is going to look back at those decisions. Future you is going to see a smaller superannuation account balance because you weren't investing in your superannuation. Future you is going to see that you worked so damn hard to create all of this positive change for everybody around you without taking care of yourself first.
So let's talk about the [00:06:00] structural and mindset things that may need to change in order for you to start thinking about yourself as someone who deserves to be paid first. The first thing we wanna touch on is money psychology. So I know a lot of you roll your eyes when somebody starts talking about money mindset or money psychology, and I get it.
There's a lot of shady people out there talking about money mindset as though it's this really simple thing. And it's not actually that woo-woo. It can be as woo-woo as you want it to be, to be honest. But essentially, the beliefs and the thoughts that you have in your mind about money and business will be impacting every decision That you're making in your business, and those decisions show up in your bank account and in your take-home pay.
So a lot of purpose-led founders are really appalled by the word profit. And I think the concept in the not-for-profit or the [00:07:00] charity world, we've kind of done ourselves a disservice calling it a not-for-profit because it indicates that profit is bad. But in a small business or social enterprise context, profit is great.
Profit is what allows us to actually grow our business. It's what allows us to fund the different impact goals that we have. So we need to have a really healthy and positive association with the word profit and with the word income. So sometimes it can be hard to understand, like what are the thoughts that I'm having about money?
You know, it's all well and good for you to sit there, Fay, and talk about, you know, what is my psychology and how is that impacting my business? But it might be that you haven't been able to explore those topics yourself. So it takes a little bit of quiet, a little bit of sitting with yourself and trying to understand, like what are the thoughts that come into my mind when things happen in my business [00:08:00] relating to money?
So it could be things like, what happens when it's time to send an invoice? How do you behave when it's time to send a proposal? What do you do when you've got an overdue reminder for a bill? What does it feel like in your body when you get a message saying you need to pay your BAS to the ATO? Right?
That could be an entry point into understanding what your money thoughts are. But another way in is to look at your behaviors. So how do you behave? Not just how do I think about sending this invoice, but what do I actually do? Do I procrastinate on sending the invoice until it's almost too late to send?
Do I deliberate on sending this proposal for so long that I actually miss the opportunity to pitch for that work? So what are the actual behaviors that you're seeing in yourself in your business that aren't helpful or resourceful in terms of getting you towards your goals? So really [00:09:00] understanding what is the relationship that I have to this word profit?
What is the relationship or the belief I have about this word income? What are my thoughts around this word impact, and can impact and income or profit exist together? So that's where it starts, changing your mindset from money and profit and income being something that might have a weird sting about it in your mind to thinking about it as that income that's coming into my business can be used to create impact, starting with myself.
So this idea of changing the way that we are thinking and feeling about money also needs to be put back onto us. So putting some of that positive impact, that positive framing, that, you know, benefit that you are trying to create in the world starts with putting that onto yourself first. And one way of taking care of yourself is paying yourself a good [00:10:00] wage.
So once you have decided that you want to pay yourself a good wage and that it is going to become a non-negotiable in your business, now you might need to start to say, "Okay, Fi, great. I really wanna pay myself more, but there's never any money to do that."
Money Secrets Ad
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Fi
So if this is what's happening in your business is that it always seems like there's other bills that are more important than paying for you, maybe we actually need to look at how you are bringing money into your business.
So bringing money into your business is we overcomplicate how to increase our revenue. Essentially, we increase our revenue by either bringing in more clients or more projects, or selling more goods, or by increasing the price of our goods or services. So which strategy are you going to take? Are you going to try to sell more, or are you going to try to charge more?
My tip is that you always look at how can I charge more first, because that can actually be a much more effective way of bringing more revenue into your business. But Fi, how do I do that? I'm so scared of putting my [00:12:00] prices up because I'm terrified of losing clients or upsetting the clients that I have.
I don't know if anybody will pay those higher prices. So yeah, it's all well and good to talk about putting your prices up, but how? The tip that I have for you today is that the best way to bring more revenue into your business through your price is by looking at which client are you trying to work with.
So are you targeting the client who values or can use your product and service the most? Have you thought about what kind of value you offer to different types of clients? So for example, somebody who's just started in business is not going to value, let's say, marketing advice as much as somebody who's 10 years into business and is able to really leverage that advice.
So are you actually pitching your product or service at the type of client [00:13:00] that can not only afford, but is willing and able to invest in that product or service, and they're willing to pay a higher price for it because they are able to utilize it or create some sort of benefit or long-term value for their business or, you know, for themselves?
So that's my tip is that if you want to increase the amount of revenue you're bringing in through your price, the best way to do that is by looking at what type of client am I pitching for. Then you can start to break your revenue down into, well, how many am I going to sell, and what will I charge? And then you can start to actually just do the maths around what revenue am I trying to bring in.
It's amazing how few of us actually know how many thingos we need to sell at what price to get to our annual revenue target. So tho- these are a couple of really practical [00:14:00] ideas for you is to think about, how do I increase my price? How do I work with the best quality client that I can? And how do I start to think about my revenue as a maths equation?
How many thingos do I need to sell at what price to get to my goal? And the last thing that I wanna leave you with today is the concept that income equals impact. So I will never talk about income and profit without also talking about impact. So as a small business owner or a social enterprise founder or anybody who considers yourself to be creating impact or benefit or purpose through your organization Income coming into your business becomes impact as soon as you use it.
So if your business has been established to improve the lives and businesses of your clients, every [00:15:00] time you earn income, you are also creating impact. You also need income and profitability to be able to do the things that you want to do in your business. It might be that your impact goals are around investing or donating to particular causes.
Guess what? That requires money. Maybe your impact goals are around donating or doing pro bono services for a particular community. Guess what? You need your wage to be high enough to be able to accommodate that volunteer time in your schedule. Maybe your impact is your service or product. Maybe you are a social enterprise whose very business is about generating, creating, and delivering impact and purpose within your products and services.
If so, the more income that comes into your business, the more impact that you are able to create. So recapping [00:16:00] on this episode, stop sacrificing yourself for your business. You need to take care of yourself first, and that means paying yourself a decent wage, working a reasonable amount of hours per week, and taking care of yourself as the most important part of your business, including paying yourself first.
In order to do that, you might need to increase the amount of revenue coming into your business. And my tip for you there is that it is much easier to increase your revenue by increasing your price. And the most effective way to do that is by looking at what type of client am I pitching myself at. Is this a client that has the budget and the desire to spend the most amount of money on this product or service?
And the third part of this episode is around this concept that income is impact. If you are a small [00:17:00] business owner delivering a purpose and impact, if you are a social enterprise founder or an impact-led business owner, then income is a tool that you can use to deliver impact. Without income, without profit, we are not able to create the positive change that we want to in the world.
So I implore you, start paying yourself, babe. Start taking care of yourself, and then you will be able to create more impact in the world.
Outro
Thank you so much for listening right up to the end. I hope you enjoyed this episode of Money Secrets, where we talk about the money secrets of successful small business owners. If you enjoyed the episode, I'd love it if you'd subscribe to the podcast, but leave us a review or share this episode with one of your friends. I hope you learned something. I hope you got a new perspective, and I really hope you enjoyed the listening [00:18:00] experience
