Money mistakes are something we’ll all make, at some point in our life. We’re human – it’s part of the journey!
So first of all, feel no shame about the ones you’ve made. You’re not the only one and you won’t be the last. Remember also that building a business is a long game – an adventure that will have highs and lows. Being committed and acting in alignment with that commitment is what will bring you success.
I’ve previously shared the 4 most powerful money lessons I’ve learned so far in my creative business journey. These are key principles I recommend every creative business owner really sit with, absorb and take action about.
In this post, I’m sharing some of my biggest money mistakes and the additional lessons that have come out of making them. I’m hoping that in doing so, I can spare you from the setbacks they brought me.
My 9 biggest money mistakes
1 Not minding my own business
In the past 12 years, I’ve actually run 3 business entities. I had a business partner for the first one – the beginning of my business journey. We worked really well together and had complementing strengths.
Because I trusted him so much, I left the management of the finances to him and that served us well for quite a while. It’s only after the end of our partnership that I realised how my perspective – even though I wasn’t as knowledgeable in the area of money as he was – would have been really valuable in some of the money decisions made.
I learned that finances was an area that I needed to understand and get comfortable with, regardless of having partners or experts involved. Not only that, but that I also needed to be confident in voicing my thoughts, questions and ideas.
2 Not having clear goals
There’s having a vision and then there’s having goals and they’re not the same thing.
I have long had a picture about what I want to create, how I want to serve and how I want to live. But for too long, I didn’t do the work of actually sitting down and creating SMART goals to move me forwards towards that vision.
I was taking each day as it comes and getting lost in the minutiae, without consistently and systematically checking in with my purpose, and my goals. My time was consumed with putting out fires; being distracted by “opportunities”; and letting my ego make choices for me.
As a result, I moved forward slowly and invested a lot in the growth of others which is great but not at the expense of my own. All the frustration, exhaustion and resentment could have been mitigated by determining my goals and making them central.
3 Undervaluing myself for too long
I always talk about this fact: personal growth is a prerequisite to business growth. I will happily continue to sound like a broken record!
My personal stories around my worthiness held me back for asking for more in my business.
Of course, I could come up with all kinds of reasons why it was okay to discount this and why I couldn’t demand more for that. Especially given that a lot of my clients have always been non profit organisations doing such great work in the world.
The fact of the matter is that I compromised my business, my livelihood and the impact I can make in the world, every time I accepted less than I deserved.
4 Trading time for money
Another thing I did for way too long is focusing on an income stream that involves trading time for money. Growth is capped when your earning is commensurate with how many hours there are in the day that are available for work.
Passive income, on the other hand, can free up your time BUT, it requires a lot of your input upfront. Strategising, planning, creating/producing, designing and setting up systems, marketing, onboarding, reviewing, improving, training etc.
In hindsight, I would have carved out and fiercely guarded time and headspace to consistently chip away at building my passive income streams. I only started to properly do this since the Pandemic began and I’m finally seeing traction.
5 Doing the most
In not having clear goals, I convinced myself that more was more. That the more things I tried, created and put out there, the better chance of abundance coming back to me.
What I didn’t realise was just how much work is involved in launching something well. As well as in then building and managing the systems to keep it going.
It’s impossible to do that for many offerings when your capacity and resources are limited.
It can also be confusing for your audience. They might not know what you actually do which makes it harder for them to engage with you, advocate for you and even choose what to buy!
I wholeheartedly embrace the idea from the book, Essentialism, of less but better. Thanks to that and participating in Rachel Rodger’s We Should All Be Millionaires The Club, I’ve been immersed in a process of stripping things away.
It’s not easy, it’s happening in stages and my mind often resists. But the benefits – the results – are clear.
When I ran the first cohort of SHINE, I observed just how many other creatives are also doing too much. It was fantastic to see all the aha moments experienced and actual shifts made, as students refocused themselves.
6 Expanding too quickly
At one point in that first stage of my business journey, we had a 12-person team! A really enthusiastic and talented group of wonderful people.
It wasn’t sustainable and we eventually had to go through the uncomfortable process of letting great people go.
It’s true that we need support to grow but, there are several ways in which we can get support before committing to putting somebody on full-time payroll.
It’s wise to exhaust those other options until your business systems are generating a consistent stream of income over a significant period of time.
Flashback to when I myself was employed. I lost my second job because one of the firm’s major clients left and the company had to downsize. I was the most recent hire and they went with last-in first-out. This lesson should have been installed then but, at the time, entrepreneurship was far from my mind.
7 Putting profit last
I did what conventional business practice expects: calculate profit at the end of the year, as the difference between revenue and expenditure.
I didn’t realise there was another way to pretty much guarantee profitability. A way that works with and not against our human nature.
A way that has the added benefits of: ensuring I’m taking care of my own needs, as the business owner; being vigilant and disciplined about spending; and improving cash flow (and reducing my anxiety!).
Appreciating the importance of cash flow has been a big lesson these past 12 years. Like the man himself says:
“Making more money will not solve your problems if cash flow management is your problem.”
— Robert Kiyosaki.
I’ve written a lot about why the book Profit First, and the system it teaches, is invaluable for any business owner – creative or not. I wish I had started putting profit first, right off the bat.
8 Working on the wrong things
When your goals are clear and you’ve designed an action plan for them, you know how you need to be spending your time.
Remember, for a long time, I didn’t have clear goals. Which means I couldn’t have an effective action plan and so I didn’t have a sense of what my activities were truly for.
I knew I needed to get clients and serve them and take care of all the related admin. But aside from that, I spent my time satisfying my whims. Yes, many of them seemed noble and they were related to my business somehow but, there was no strategy about it.
I wasted a lot of time this way, doing things that didn’t really get me anywhere. But it’s because, as explained in points 2 and 5, I wasn’t really clear about where I wanted to go in the first place!
9 Not dreaming big enough
This money mistake is live and present. As with many of the others, it’s rooted in my personal mental blocks. I have HUGE dreams but, there is a distance I feel between my reality right now and them coming true.
The real problem is in how this influences how I show up. Playing small, overthinking, holding back, not putting myself out there, being afraid to be vulnerable, fear of rejection, complacency and procrastination.
Some of you might be surprised to read that I experience some of these barriers to showing up. I hope that’s a reminder that there are levels to all of these money mistakes.
There is always room for growth, for everyone.
Your money mistakes
I’d love to hear from you! What money mistakes have you made and what did you learn from them?
Do any of these mistakes instil fear that holds you back from taking messy, imperfect action?
If it’s any consolation, you can always bounce back – I have!
The glass is half FULL!
At the end of the day, making these mistakes enabled me to write this article and empower somebody else, so I’m grateful for them. I’m also thankful that I won’t make them again! They’ve made me that bit better at this creative business thing.
I’ll be sharing more money strategies, tips and resources – as well as stories from my journey – in my free 5-day Thriving Artists Challenge.
I only run it twice a year so sign up here for the final edition in 2022 which begins on Monday 25th July.
If you’re ready to go DEEP into all of these lessons, as well as all the mindset, habits, rituals, routines, systems and processes you can implement, to avoid these money mistakes, then my SHINE program is for you. Not everybody will be ready.
Wherever you are, here’s to getting our money right and our creativity changing our world!