How to keep your head business, when everyone about you is losing theirs.
From time to time it is going to happy. The world gets a little wonkey and the word “recession” starts getting bounded around news broadcasts, social media and eventually into your networks. News and Social Media thrive on panic and exaggeration. Fear sells. However your network should be a place for stalwart support and guidance. So here we are telling you, when the time comes, not to panic.
Do this instead:
DO YOUR CASH FLOW PROJECTIONS!
- Yes I know I sound like the proverbial scratched record. There is a good reason for that. Cash flow projections are like a gift from above when disaster strikes. HOWEVER waiting until disaster strikes to create one is like shutting the stable door after the horse is half way to Mexico. Not particularly useful. If you don’t have one, log into your member portal and download the template….today. If you still need assistance, reach out. We have a number of members in the network who actually enjoy numbers (We are weirdo’s, I know)
Have multiple revenue streams.
- They don’t all have to be equal but having more than 1 way of generating income is a huge relieve when your main source starts to fail. Being able to divert your attention and grow another source quickly is much easier than trying to reinvent the wheel. Build multiple revenue streams into your business plan….. don’t have a business plan? Guess what….. yup, here we are. Over here at Connect Now, waving at you like lunatics. We can help with that.
Stash money under the mattress. Figuratively, not literally.
- Depending on how you tackle life you can either call this your Nest Egg Fund (very nurturing and comfy sounding) or you can call it your War Chest (“YOU CALL THIS A STORM!!!” Lt Dan, Forest Gump). Either way you want to have one. Start putting something away. The good news is because recessions rarely happen overnight (we usually get some warning) you don’t need immediate access to this fund which is why you can lock it away in an account that doesn’t give you immediate access. Guess what, we also have members who can help you choose the best way to store these funds (TFSA, Short term investments ….or…. stash it under the mattress.)
File your taxes! Even if you think you made minimal (or no) money, file your taxes.
- If you file and it turns out you are due a refund, yay.
If you file and it turns out you owe not so yay however you won’t get a late filing penalty to go on top of the amount owing. This debt becomes the same as any other debt. If you can’t pay it in one go (at the due date of April 30th) you chip away at it as best you can. Yes there is some interest to pay, just like on your credit card or any other debt. That interest doesn’t go away because you decided not to file. It’s still there.
So what about you don’t get a refund and you don’t owe? You still want to file your returns. You may be entitled to some (careful…. Tax speak coming your way….) refundable credits. You may qualify for certain credits (which I won’t go into here) and you could end up getting money that you were not expecting. Also any other government funded benefits get stopped if filings are not up to date. Trust me….. just file your taxes. I know you hate getting ready to file your taxes. Do I need to say it again? We have people who can help with that.
- If you file and it turns out you are due a refund, yay.
Lastly figure out what it is about your business that people NEED rather than WANT.
- (Although apparently more people needed Toilet Paper than I ever gave it credit for! Credit Corvid-19 for anyone looking back in future years.) For example: I currently work in the world of Finance and contract to a Tax Preparing office. I can say with strong certainty that no politician is going to tax away the requirement for people to pay taxes. Therefore I can say with strong certainty that assistance with preparing taxes is likely to be a need for a long time. What is it in your business that no matter how tight money becomes for the masses they will still need it.
Lastly part b……
- is there anything in your business that would actually be beneficial to people should a major recession hit? My family own a metal recycling business. As it turns out, when a recession hits people look for alternate ways to generate cash. Recycling old metal (can’s, scrap cars, even brass casings from bullets) have been brought in as alternate ways for people to make money. If your company can generate more cash for people in a pinch, it can be a win-win for both parties.
Long story short, if you need help recession proofing your business, we have someone who can help with that!
Donna is the CFO of Connect Now Business Network, a fourth-generation entrepreneur and financial consultant. She has worked with money or cash management for most of her career. What started out collecting fines for the legal system or collecting debts for private enterprise progressed into bookkeeping with an accounting firm. This gave her a solid understanding of what you need to run your business and what you accountant needs to prepare your year-end financials and tax returns. After many years in this field and 2 children later it was time to set up her consulting company Beyond Balanced Books. Donna has a passion for helping business owners understand their financials and how best to utilize their money to grow their business in the quickest way possible. Her unique approach focuses on not only the business cash flow but how personal cash flow affects the business growth as well. She has a way of explaining numbers that makes them less scary. Donna delivers her advice with humourous flare backed up with solid accounting practices.