Month: February 2018

The Right Things

On By seancovellIn business, fitness, Health and Wellness, PhilosophyLeave a comment

One of the Harder Things in Life

Sometimes it’s really hard to know if you are doing the “right” thing. It’s often hard to even know what the right thing is. No matter what my age is or how much experience I’ve gained, I continue to wonder if what I’m doing is really the right thing to do. I don’t think anyone can know for sure until time passes and they can see the look at the result of their actions. Therein lies the hardest part- you have to wait to find out whether the actions you have taken were actually the right ones in getting you towards your goal. The waiting part is what drives me nuts. I’m the type of person that likes to see results as quickly as possible and I despise waiting long periods. I know that this is the source of most of my anxiety. I’m constantly questioning, which can be good to a point, but will quickly lead to either analysis paralysis or can lead to me second-guessing myself.

I don’t think I’m alone here. If you are a parent, a business person, an athlete, or a partner in a relationship, I think it’s very common to second guess whether your are doing things the best way possible. I’m all of these things, so some of the questions that run through my head are the following; “Should I have gotten angry with my kid?” “How do I communicate well enough to make an impact?” “What is the best way to teach this person?” “How do I know what the best way to invest is?” “Are they acting this way because of something I’ve done?” “Am I doing things the best way possible?” “Is there a better path that I’ve ignored?” “Am I a good father?” “How can I be a better athlete, husband and business person.” “Am I spending money on the wrong things?” “Why do I always second guess myself?” I’m curious, do any of these questions sound familiar?

Of course, all of these questions stem from the possibility that I could in fact be wrong. And being wrong about anything could have some consequences. We are fearful of the consequences of being wrong because our most basic fears are that we are not enough, and that we won’t be loved. Being wrong can lead to both of these fears. For instance, if I spend money in the wrong areas of my business, I could go out of business, significantly affecting the lives of my family and employees as well as my customers. If I yell at my wife or kids, they could grow to resent me and I won’t be loved. If I train a certain way because I think it’s the best way for me to train, I could be hampering my ability to reach my full potential as an athlete. These are all things that I fear. Although I realize the harm and futility in allowing this fear into my thinking, I also realize the dangers of being too naive about the consequences of all my actions.

I bring all this up, not to complain or admit that I have weaknesses, rather I’m writing this to remind us all that doubt and fear is normal. It’s truly very difficult to know if you are doing the right things in every area of your life. There are some things that I’ve recently been doing that I believe have eased my anxiety in this area. The first is meditation. I can’t honestly say that I’m great at clearing my head of all thoughts, but meditation has helped me distance myself from my thoughts and take a more rational approach to analyzing whether these thoughts are helping me or hindering me from my desired outcome. The second thing that has helped me is to remember the times when I did something extremely well and how I felt before, during and after. This exercise helps me gain perspective on how I was able to deal with other obstacles and events in my life and how I felt during those times. If I remember that I was nervous and stressed out during a past event, but I still achieve the desired outcome, I can ease my mind about the stresses I currently have by reminding myself that it will work out. If I was absolutely confident, that will help me to realize I need to replace my current thoughts or doubt with those of strength and confidence.

The last exercise that has helped me is to visualize who I have to become to attract the things and feelings I truly want in my life. For example, the current version of me is only capable of achieving a certain level. But, how would the best version of myself act right now? What could he accomplish? I like this exercise because it reminds me that to “get more than I have, I have to become more than I am”. By focussing on how the best version of myself would act, I find that negative thoughts fall away quickly, because my highest self understands the futility of constantly criticizing and second guessing myself. “How would my highest self act right now?” I think that’s a great question we should all ask more.

Remember, doubt and fear is a normal part of life. It’s not shameful to admit that you have both fears and doubts. But, remember also that there is something you can do to overcome the fears and doubts that creep in. By distancing yourself from your thoughts, changing your state and focussing on times that you did extremely well, you can change the biochemistry of your brain and switch the focus from fear to confidence and tranquility. After all, I think one of the most truly helpful beliefs is that you should remain calm that it will all work out! If we believe it will work out, many new possibilities will open up to us. We must have faith in ourselves that we can figure it out and live an incredible life.

In health

Sean

Business and Finance 101

On By seancovellIn UncategorizedLeave a comment

Get Your Money Right!

I’ve had a large number of requests to write about business and personal finance. So many thousands of books and essays have been written on these subjects that I feel it will be difficult for me to add much more. However, I will cover a few crucial areas that I believe most businesses and households neglect when it comes to managing finances. The subject of money is often stressful, so I understand the temptation to avoid looking at your bank account and just praying that it will all be ok. Every time I get hit with a huge tax, fee, rent increase or my businesses have a lousy month for revenues I feel the stress as well. However, if it’s one thing I’ve learned, pretending it will all be okay without any strategy or action to back it up is useless. As Jim Rohn liked to say, “You can’t go in your garden and chant ‘there’s no weeds’!” The weeds will grow right up over your toes if you don’t recognize them and pull them out. So, here are the areas I think most households and businesses should pay attention to on a weekly basis:

1. Cashflows and income. It’s absolutely imperative that you track your income regularly. If you are in business, this will help you identify trends throughout the year and allow you to plan accordingly. If you get paid a paycheck once or twice a month, count that too. Make sure that you’re netting the correct amount. I can’t even tell you how many people I come across that don’t know how much was in their last paycheck. The same goes for business. Most small business people I know don’t know how much they made last month! They just keep grinding, spinning their wheels and getting nowhere! I’m asking you to keep track of the amount of money coming in on at least a weekly basis. If you only get one paycheck monthly, try to increase your streams of income so that you are getting paid multiple times a month from different sources.

2. Expenses. How much does it cost to run your business every month? How much does your family spend monthly? From my experience, the majority of people sorely underestimate their monthly expenses. Every business and individual should have a very detailed breakdown of every single category in which money was spent. Once you see how much you are actually spending, I guarantee it will be eye opening. When it’s all said and done, how much money did you have left over at the end of the month? Everything else was an expense that needs to be accounted for. If you had a little too much “month left at the end of the money” so to speak, it’s time to cut back your expenses and try to simultaneously to increase your income. If you can do both, you have discovered the fastest way to becoming financially free.

3. Know your numbers and what they mean. TRACK EVERYTHING!!!! This is the area that most businesses are neglecting. For example: what are your payroll hours as a percentage of revenues? What about rents as a percentage of revenues? What is the lifetime value of a new customer? How much new revenue does a new client produce in their first transaction? How much revenue does each billable payroll hour produce? What are the total costs per operating hour in your business? How much net revenues or expendable income are you left with at the end of the month? What is your best quarter for growth historically? How much are your COGS, or Costs of Goods Sold? You must know the answers to these questions and more if you want your business to succeed for longer than just a few years.

4. Work on your business and not in your business. If your business depends on your daily efforts to succeed, you are self-employed. You do not actually own a business. There’s nothing wrong with that either, just don’t be fooled into believing that you are an entrepreneur when you’re really working 80 hours a week and only making a few thousand a month. You may just be the lowest paid employee in your business. A true business owner spends most of his or her time reading market trends, strategizing, optimizing systems and making sure the business follows the regulatory and tax requirements. If the owner is not present, the business should still function well. The owner simply works to optimize the profits and expansion of the company and then decides how best to spend or reinvest the profits.

5. For households, follow the 70-10-10-10 RULE. When you determine your monthly profits or wages, never spend more than 70% of the money you earn. This includes all expenses like housing, cars, insurance, food and entertainment. 10% of your left over money should go to active capital, or starting your own business, which will produce additional monthly income. 10% of your income should go passive capital, or an investment run by others that will produce monthly passive income. The last 10% should go to charity or helping others that you care about. I strongly believe in this last one because the secret to living is truly giving. Helping others succeed will result in you doing even better. What goes around comes around and when you help others, you will reap the benefits. (If your monthly expenses are taking up more than 70% of your income currently, work immediately to reduce your expenses and increase your income. Eventually, as your income increases greatly, your expenses may only by 50%, leaving you with more to invest in businesses and spend more on helping others.

6. Know how much it costs to acquire a new customer. Track your marketing ROI, or Return on Investment. Many companies with advertising budgets are not properly tracking the lifetime value of a client, the efficacy of their marketing, or the total cost that goes into acquiring a new customer. I have made this mistake many times. I’ve spent hundreds of thousand on marketing without calculating my exact return from the ads. My new rule is that if I spend one dollar in advertising, it must produce more than a dollar in revenue in the first month. Other companies use a longer time frame as their metric depending on what they sell, but this rule has helping me control my marketing costs significantly. I also focus as much as possible on direct marketing so I can track who is engaging with an advertisement and then I can subsequently track what marketing pieces led to new clients. Another cost associated with new customer acquisition is the payroll hours it takes to call prospects and past clients, and the creation of media (such as signage inside and outside the business), etc. Just be sure to track all costs associated with new customer acquisition. As a general rule, the companies that can afford to spend the most to acquire a new customer and then have that customer produce higher than market average revenues for the business will win!

7. Love the business you are in, but fall in love with the customers more. Business is hard, so it helps greatly if you are passionate about the business you are in. I love health and fitness and bodybuilding, so this is easy for me. But I’ve learned that companies do best obsess over their customers, rather than the products or services they produce. Customers are the ones who pay all the bills at the end of the day. They are the real bosses. Every one needs to feel special or significant, so if a company can solve a problem with their products while making the customer feel special, they will do better than companies who do not.

8. Know the difference between good and bad debt. We live in a debtor nation. The country itself has a 20 trillion dollar federal debt and household debt is at record levels. Debt cycles are the reason for booms and busts in economies and a business or family that takes on too much debt will face significant financial hardships. However, there is a difference between consumer debt and business debt. The latter is a type of debt that produces income and is paid for by others. For instance, if I take out a mortgage to buy and apartment complex that produces cashflow, the tenants are paying for that debt. I am using the debt to create profit. This is called leverage and can be a good thing if used wisely. Consumer debt on the other hand is debt that is paid by the debtor. This includes home mortgages, student loans and auto loans as well as most credit card debt that we are familiar with. Do not let debt sink you or your business!!!! Go back to the 70-10-10-10 rule and see how much of your monthly expenses are debt service, or paying back money you’ve already spent.

There are so many more business lessons, but I think these eight rules are a great start for any business owner or head of the household. I’m hoping any of these tips will lead to financial abundance for you and your family for many years to come.

In health and riches,

Sean