I’m not good with money; I’m the creative type

I’m not good with money; I’m the creative type

Dominik Loncar, CYBF Entrepreneur-in-Residence, dloncar@cybf.ca

Do you catch yourself saying, “I’m not good with money; I’m the creative type.” Is this really true or is this actually a story that you keep telling yourself?  Maybe what you’re really saying is that you don’t like to manage money — which is not the same as not being capable of dealing with your finances.

Oddly enough, creativity is about producing results within limited resources. The best ideas typically come out of having to work within various confines (inside-the-box thinking creates outside-the-box breakthroughs). Financial literacy actually allows you to be more creative, not less.

Money management does not have to be some boring business talk about return on investment ratios. If you can budget at home then you can budget for your business; and if you have no idea how to budget or where to begin, well then you can always learn. Understanding basic cash flow (money coming in versus money going out), is essential in running a business. Although an accountant or bookkeeper can assist you, knowing how to read a basic cash flow will help you make decisions that will have far reaching implications.

Keep in mind that managing your cash flow at home will also take on more significance. Your personal finances can affect decisions you make about your business and vice versa. Your lifestyle at home may need be adjusted to reflect the realities of your business. I knew a client who decided to live their life the exact same way they had always lived, with a high mortgage and expensive tastes. They eventually declared bankruptcy.

Don’t make the same mistake. Look into the various ways in which you can gain some knowledge in this critical area of entrepreneurship. Whether you’re starting a for-profit business, a social purpose business, or a not-for-profit; this skill set will be vital!