“How do I keep building wealth when I’ve lost 50% of my income?”
There are a lot of convenient excuses for giving up on your business at the moment. But now more than ever, I want to teach you how to take control of your finances.
Just last week, I was talking to a client who had to let go of 20 employees.
The week before that I was talking to a client who was forced to choose between keeping her dream business open and finding a stable job.
I’m willing to bet you have faced similar problems.
But before you give up completely and say that “building wealth is too hard during a crisis”, I want you to remember a couple of things:
- It’s OK if you’re not quite sure what you’re doing. Nobody really does.
- It’s OK if your wealth-building slows down a bit- it doesn’t mean you have failed completely.
In this blog post, I am giving you 7 ways to keep building wealth (even if you have lost 50% of your income).
Related post: Daily Money Mindset Exercises To Build Wealth In 2020
5 ways to take control of your finances during a global crisis
1) Diversify Your Income
One of the most important principles of building wealth is to diversify your income.
This means that your money is coming from more than one place. That way, if one income source stops, you still have something coming in.
In my last blog post, 7 ways to build your online business during Coronavirus, I mentioned that creating mini offers is one of the best ways to protect your business.
This is a way that you can diversify your income.
If you are a coach for example, you could create small ticket items like membership sites and ebooks. It increases purchasing power for your clients, as well as continuing cashflow when your big-ticket items slow down.
2) Keep Putting Money Into Savings
The worst thing you could do is to stop putting money into savings. If you want to take control of your finances during a crisis, you need to have a backup.
Putting money into a savings account (even a small amount!) will:
- Help your abundance mindset by seeing the number go up slowly
- Give you more control in the crisis- people with backup plans build wealth!
- Help you prioritize contingency and budgeting over emotional spending or hoarding your money
- Improve your purchasing power for when you can spend within the local economy again
To help, put a name on your savings account. Call it your emergency rent account, your post-quarantine holiday account, your business investment account- anything that you are working towards.
Need help getting started with saving? In the video below I give you the simple 3 question rule for saving more money 👇.
3) Avoid Emotional Cutting And Spending
As I said, it’s OK if you are a bit anxious about money right now. However you probably know that that is not the best time to make money decisions.
If you aggressively cut expenses in your business, or buy things online because you are bored or tired or scared, then you will feel out of control with your finances.
To take control of your finances during a crisis, you need to create emotional boundaries around money.
Remember: Money is just money. It is just a tool. Problems arise when you attach negative feelings or associations to it.
And don’t get me wrong- I LOVE to spend money on things that I enjoy. I firmly believe that we can spend money AND build wealth. I believe that we shouldn’t feel guilty about spending. But if you feel 1) out of control and 2) want to keep building wealth during an economic recession then you need to be truthful with yourself.
Here are a few ways you can avoid emotional cutting or spending during this time:
- Wait at least 24 hours before making splurge purchases online
- Unsubscribe from emails and snooze social media accounts that you would normally buy from
- Tell other people you are trying to be smarter about your purchases so they can keep you accountable
- If you want to buy something or cut something out of the budget, write it down. Having something on paper gets it out of your mind so you can come back to it
You don’t need to stop spending money altogether. But you should work to be in control of your money mindset instead of the other way around.
4) Don’t stop spending money to make money
Running an online business means monthly expenses. If your first instinct was to cut back on expenses when you heard about Coronavirus then you’re not crazy.
But cutting expenses that help your business make money won’t help you keep your business afloat!
During this time, it is more important than ever to make SMART business decisions. I need you to think like the CEO that you are.
Instead of shutting down your systems completely, use this opportunity to take stock of what is serving you. Instead of canceling all payments, ask questions like:
- Is this expense bringing in leads?
- Does my business run more smoothly with this system?
- Will my business continue making money without this process?
- Can I serve my customers in the way they deserve without this?
5) Keep Track Of Incoming And Outgoing Money
The truth is, the world is heading for a global recession. And that might mean that you lose some of your income.
But you won’t know unless you keep track of everything coming in and out!
Not only do I teach my clients how to make money while staying true to themselves in business, I show them how to MANAGE their wealth as well.
The first step? Keeping track of what is coming in and out of your bank account.
If you don’t keep records of how much is coming in, how will you know if you making less money or just giving into panic?
Wealthy people know what their money is doing. So the first step to building wealth (even during a crisis) is to start paying attention.
- Join the FREE Intimate and confidential gathering to end money worries, to break your money worries under uncertainty, know the tools you need to pass through these times and how to prepare yourself for a post-crisis success.
- Listen to The Happy & Wealthy Podcast
- Get your FREE financial road map to help you plan your most successful business year yet
- Read more money mindset, biz building and wealth management blog posts
- Come chat with me daily on Instagram, @alejandrar_coach