I call it “The Empire Mentality.”
What it means is that you act like the owner of a major empire even before you have the clients or the bank account to prove it.
And guess what? When you take your business seriously – miraculously, so does everyone else.
Here are five starter steps for making your business real…
1 – Get a Business Checking Account
Do you let your money just flow in and out of the same account? Are you paying for groceries and web design from the same checkbook? At the end of the tax year, are you frantically trying to determine which expense is business and which is personal?
Yes, yes and yes?
Well, this must change immediately. Make it a priority TODAY. Get a checking account for your business.
This may sound like Biz 101, but I meet too many self-employed women who work in this kind of accounting chaos year after year. It’s guaranteed failure.
2 – Pay Yourself a Salary
Lack Mindset Symptom #143: You don’t pay yourself a salary. You just grab what you can at the end of each month and hope for the best.
When I meet women who do this, they try to convince me that they’ll change once there’s more money coming in. No they won’t. It works in reverse. Value yourself and treat yourself like a real business first – THEN the money comes in.
Now that you’ve set up a business checking account, here’s your next step. Choose an amount to pay yourself each month or week. Then set up a system and do it. (No, it doesn’t matter if it’s $25 or $2500. What matters is that you do it.)
Money does what you tell it to do. As such, it needs to know where to flow. Once you set up an exact amount for your salary, you’ll be amazed to discover that this amount always seems to be there each month.
3 – Set up a Business Entity
If you’re still a sole proprietor, you’re probably paying way too much in taxes. Self-employment taxes are among the highest taxes you can pay.
Whether it’s an LLC or an S corporation — you need to have both the tax benefits and the legal protection of a business entity. Choose a name for your company, and research the options available to you. Find a reputable local attorney who can help you make this happen.
4 – Get an Accountant
I’m willing to bet that you suck at accounting.
I’m also willing to bet that every single year, when tax time rolls around, you feel like throwing up.
Fact #1: Dread eats away at your energy.
Fact #2: Every minute of time you put into QuickBooks is a minute that you’re not doing your genius work. (The stuff that MAKES the money!)
Fact #3: If you don’t have an accountant, the chances of you facing an IRS audit increase by about 7000%.
(Yes, I said 7000%. Now you know why I have an accountant.)
Entrepreneur, take thyself seriously. Get a great accountant, and happily pay her the hundreds (or thousands as you get more successful!) to ensure that your taxes are done professionally. You’ll sleep better and you won’t throw up.
5 – Set Boundaries with Friends and Family
If your friends or family don’t take your business seriously, it’s an issue of communication.
People who have never had their own business simply don’t understand what you do! They often won’t take your time or space seriously. They might call during the day, drop in when you’re on a call, or accuse you of not being a good friend when you can’t just pick up the phone.
All of this can be prevented with some communication on your part.
But first, you must be clear about your boundaries. What are your hours? Who do you work with? Do you do pro-bono work for friends? (I strongly suggest that you don’t!) Does family get discounts? Do you hire family or friends? What will you/won’t you tolerate?
Take some time to get clear about what most needs to be communicated to the people in your life. And then, honor yourself and your business enough to share these boundaries in a clear, proactive manner. Then, it’s up to you to enforce your boundaries!
QUICK! Before you talk yourself out of it!!
In the comments below:
1 – Tell me which one of these action steps you’re going to do NOW – and,
2 – Share the very first step you will take to make it happen!
Editor’s Note: This post was originally published in February, 2013 and has been given a slight makeover to keep it fresh and current.