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10 ways to ensure financial growth in business

Article written by Andre van Rooyen (ActionCOACH – Business Coach)

Unless you are one of the few people who were lucky enough to receive a large inheritance, win the lottery, or marry into money, you will need to create your own wealth.

This is not the easiest of goals given the impact of loadshedding, a stagnating economy, rising interest, and the relentless impact of inflation, it may seem almost impossible.  

However, by developing the following 10 habits, you will be able to do just that.

1. Establish life goals

What does financial freedom mean to you? Get specific. Jot down how much money you should have, what the lifestyle entails and at what age this should be achieved. The more specific your goals, the higher the likelihood of achieving them.

2. Live within your means

Living below your means does not mean having to miss out on life’s pleasures. Rather, it simply means that you are spending less than you  earn. Create a budget and stick to it.

Living within your means requires discipline and sacrifice, but in addition to building wealth, you will also enjoy these benefits:

  • Less stress and anxiety.
  • Better health.
  • You’ll have more freedom.

3. Build a cash reserve

Having an emergency fund will alleviate stress should you encounter a financial emergency. Should you not have the cash on hand to handle such emergencies, you may have to incur for debt and interest commitments.

Ideally, you should have three to six months’ worth of your expenses in reserve.

4. Use debt strategically

Not all debt is bad. For example, if you plan on buying a car or home you will need a good credit rating. Applying for a credit card and using it responsibly can achieve this goal. You can also use debt to your advantage to further your education, acquire property, or grow your business.

5. Have an organised investment plan

The biggest mistake people make with investing is thinking they are too young to worry about saving for retirement. Accept that retirement is an inevitable phase of life that requires wealth.

There are retirement plans and investments specifically tailored for entrepreneurs and small business owners.

For non-retirement investments, consider shares, offshore managed funds,  property, and short-term money market accounts.

6. Get more bang for your buck

Spend your money wisely. Purchases should be fit for purpose. Do not follow fads or try to keep up with the Joneses.

Measure your return on investment in respect of all business expenditure.

7. Be adequately insured

I can personally vouch for the benefits of having adequate critical illness cover. In addition, you should also be insured for the following:

  • Income Protection
  • Death
  • Key Man Insurance if you have a business partner.

8. Become a financial master

You need to continuously educate yourself on topics ranging from taxation to investing to retirement planning, by reading financial books, following authority figures online, or taking online courses.

9. Seek out other income streams

Engage a business coach to assist you in scaling your business and building it to its potential. The goal is passive income.

10. Prioritise your health

Finances and health are nearly impossible to separate. Health care costs money, and making money is a lot simpler when you  are healthy. When you are healthy, you are less likely to get sick.

With the rising cost of healthcare, taking care of yourself today can reduce these expenses tomorrow. Therefore, make getting enough sleep, eating a nutritious diet, and exercising regularly a priority.

ActionCOACH is a proud National Partner of the NSBC

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