To become a great entrepreneur, you need to arrange your entire life around your business projects, including your finances. Unfortunately, getting this aspect of your life right can be a challenge. Around half of all millennials want to start a business, but the vast majority don’t have the finances to make it happen.
Therefore, entrepreneurs need to follow some basic money rules to make their projects a success and get the freedom they crave. Here’s what to do.
- Live Like Crap
It might sound like an awful thing to say, but when you want to become a world-beating entrepreneur, you need to live like crap. Often you can’t afford to buy nice clothes, go on holiday or even rent an apartment. You need to slum it so that every spare cent you have can go towards your business.
If you think that this sounds a little extreme, look at how many successful business people lived their lives before they encountered success. Internet millionaire Gary Vaynerchuck lived in a dive and didn’t go on holiday for more than a decade while building his fortune. He plugged away endlessly and worked practically every weekend to achieve his vision. The same goes for Tesla CEO Elon Musk. He didn’t buy himself a property until he was a billionaire.
- Get Out of Debt
Entrepreneurs sometimes need to go into debt for their businesses, but this is very different from personal debt. Somebody lends the business entity itself capital, taking on the risks. The people who run the company aren’t individually responsible for paying it back. And those that lend them credit can’t take away their assets to repay the loan.
The same is not true when it comes to personal debt. Banks and other lenders can come after your possessions if you don’t keep up with repayments, putting you under enormous stress.
Entrepreneurs don’t need this kind of pressure in their personal lives. It would be much better if they had a clear run where they could focus exclusively on their companies without worrying about whatever is going on in the background.
The Debt to Success System is one of the most exciting developments in the realm of personal finance in recent years. The scheme allows people to rid themselves of money that they owe and get on the path to financial health. It takes advantage of the fact that banks don’t really lend out other people’s money when they extend credit. Instead, they create money out of thin air and then get members of society to pay it back.
- Pay Yourself a Fixed Salary
Some entrepreneurs get so caught up in their businesses; they forget to pay themselves a reasonable salary at the end of the day.
Paying yourself is essential. Even though you might have grand plans for your business, you need at least some money in the bank to provide for your basic needs. Sometimes, it’s nice to have the luxury of ordering take-out or going for a weekend city break.