Profitable Investments & Expenses Strategy: Simplifying Business Finances

Hey there, wellness entrepreneur. Welcome back! 

Before we get into today’s blog, I just want to remind you of the upcoming free workshop. It’s on August 16, and if you’re watching this after the effect, don’t worry, you can still get in by clicking this link LINK

This is The Path To Profit Workshop, a workshop for health and wellness entrepreneurs, just like you, to ignite the business of your dreams using my proven Blueprint for Success. It’s time to reduce the struggle to bring consistent revenue with a clear, proven path to success.

In this workshop, we’re going to boost your profit with the six critical steps to hit six figures with ease, you’ll cultivate true work-life balance as a solopreneur or with a small team using my essential time-saving hat, and you’ll discover how to increase demand for your offer and your bank account, eliminate niche drama for good, so it’s easy to attract your ideal client, get more consults and more clients without spending any more time in your business.

This is a free live training, and if you can, make sure to attend live, there will be a special offer for you. This workshop is perfect for the wellness entrepreneur, a yoga teacher, a health coach, physical therapist, healthcare provider, healer, and energy worker.

It’s Wednesday, August 16th, 3:30 Pacific Standard Time, 6:30 Eastern Standard Time. There will be a replay available. So again, if you’re reading this blog after the effect, you can get access to the replay right now, immediately!

Enroll Now: The PATH TO PROFIT Workshop (FREE!)

Again, attend live if you can for the free offer. I’ll see you at the workshop. Now let’s get to this week’s blog! 

Today we’re talking about your Business Finances, specifically your investments and your expenses.

Now, just as a reminder, I am not a CPA, I am not a bookkeeper, and I am definitely not a lawyer. Today, I’m sharing with you the knowledge that I’ve learned from my personal experience of growing six-figure businesses, businesses past six figures, both different types of businesses, investing a lot in my business, helping clients become more profitable and making decisions on their investments, as well as being friends with many entrepreneurs who invest in their own business as well, and taking part in several different types of Masterminds.

A Simple Strategy With Your Finances

Okay, a simple business strategy regarding your finances is you want to keep track of what is coming in. So what revenue you’re bringing into your business, and the revenue and the expenses or in the investments or money you have going out. And it simply can be done in an Excel spreadsheet, or QuickBooks. There you have it.

You also want to learn how to track certain other metrics in your business that will influence the revenue you have coming in, and even help you decide what investments to make in your business. It will help you understand if it is a “smart investment,” because you can plan for the money it’ll bring after you make the increase in profit or revenue it’ll bring after or during that investment.

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And specifically, that’s what I teach in the Awaken Business Coaching Program. I teach my clients how to keep track of their finances and what to monitor. We can go into more detail of what that specifically looks like and what to track in both their personal finances and their business finances. And I also teach them the metrics to measure in their business.

So, when they have important decisions to make, like, are their expenses too high? Should they hire staff? Should they invest in their own Mastermind? Then they can make decisions faster instead of feeling stuck in their business. These numbers will help to guide these decisions.

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The Numbers We’re Talking Specifically Today

The numbers we’re talking about specifically today are your expenses, which can play into your profit. So how do you figure this out to start? Let’s take some easy numbers to work with.

Let’s say you had a $10,000 month, you had a profit of 10%, which is on the lower side, but some months, that’s what it is. And we’ll get into that in a moment. So that would mean that your expenses were $9,000. And your take-home profit was $1,000. Now, this does not take into account taxes at all, we’re just talking about expenses and profit for take-home. Those numbers to start are just data. $9,000 is getting paid to expenses in your business, $1,000 is going to you. What our brains like to make these numbers mean is that they’re good or bad.

So, for example, when I started off, I said 10%, profit is not that great. However, if you had a plan to take a hit in your profit, because you knew you were hiring five different staff members all at the same time, it was five salaries that your business was not used to paying, and you had a big picture plan that to take that hit in the profit to help leverage your time and also scale for more growth, because those people would be able to do the job of five people instead of you by yourself as one person, then eventually the profit would catch back up, and perhaps pass where your profit was originally, prior to hiring those staff members.

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So again, there’s no right way, there’s no perfect profit or expense number. I can give you some general estimates because people like to just have a baseline of knowing where to start. Remember, as the CEO, you always get to decide if you want to keep that baseline or change it.

The Profit Difference Between Physical Business and Online Business

So when I was owning a brick-and-mortar physical therapy clinic, the Masterminds, and the numbers that were thrown around in Masterminds and coaches, I utilized in that world was 20 to 30% profit, which was about the average. In the online space, where there’s less overhead, meaning we don’t have to pay for rent and a lot of physical items to serve a clinic, for example, the profit has a chance of being higher because the business can be leaner, where 50% profit is achievable for a lot of businesses in the online space. So there are some numbers to work with.

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Your Goals And Metrics Define Your Profit and Expenses

Again, you might be lower at some times in your business, and your profit might be higher at some times in your business, again, depending upon the business strategy for which you’re shooting in that quarter. Are you shooting for profit growth? Or are you shooting to invest more in your business, to leverage other things in your business, to buy back time, for example? So then you can scale. So you’re not always 100% of the time shooting for profit growth in your business. It’s just not achievable.

And a business coach is a wonderful person to help you decide what quarter or in what year you are going to shoot for profit or what year you are shooting for maybe maintaining your profit or even decreasing your profit to scale in other ways. But the bottom line is, as a CEO, you do have to pay to play. 

There are always going to be business expenses in your business. And if you have your expenses too high, that can cut into your take-home profit. However, if you have your business expenses too low, it might be actually slowing your growth because you’re not developing the skills or having the items that you need to grow and scout. So how do you know? Again, it’s decided upon your goals and those metrics.

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When Are Your Business Expenses Too High?

But let’s talk about some ways your business expenses can be too high. Things might cut into your take-home profit, especially if you’re starting out, so you’re more of the solopreneur working by yourself.

It might seem very enticing to hire a VA or hire someone like a marketing assistant or an admin assistant. The mistake I often see is people making this investment or expense in their business too quickly because they’re avoiding certain emotions that they don’t want to feel in their business. Maybe it’s overwhelming to manage a busy schedule, so they feel that if they just hire an admin assistant, they can take a bunch of tasks off their plate, and that admin person can do it, and then their schedule will feel better.

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That’s not always necessarily the truth of what happens because you have to train that admin person. And that admin person needs to know how to do those tasks efficiently in your business so they get done well

If you do not train your admin person well, you might end up always correcting the mistakes of the admin. This then becomes a very expensive expense in your business, if two people are now doing the job of one. So hiring another person too early is an expense that can really cut into your take-home profit, because it’s not being utilized most efficiently.

Another area where your business expense can be too high, especially as that solopreneur starting out, is purchasing expensive software that you don’t need right now, like a fancy WordPress site, or fancy scheduling and big robust apps that you might not utilize to their most of their capabilities.

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For example, investing in a big software like Ontraport, like I have that, houses your CRM, where it houses your e-mails, and also has a lot of capabilities for making your own registration pages, even housing your own membership site. It’s a very robust system. 

However, if you’re just starting out, and you’re just looking for a place to house your e-mails, you don’t need all of that in Ontraport. And there are several different software’s where you can actually do that for free to start, or is a much lower investment to start, a lower cost per month. And the software is much simpler to learn and easier to use. So it’s also taking a look at the software and the apps that you have, and really deciding what you need, especially in the beginning, instead of having a lot of expenses going out to people and software to try to feel more organized in your business.

And the key here is to feel because you are the one who is in charge of the feelings. The software or people in your business are not going to create your feelings. So it’s really being truthful with yourself prior to investing. 

You can ask these questions:

  • What is the outcome that I want to achieve here beyond being truthful with yourself? 
  • Are there certain emotions, like boredom or overwhelm, that I’m trying to avoid in my business? 

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Because there are going to be days, there are going to be times in your business when you do have to do tasks that are boring and repetitive or monotonous. It’s just part of owning a business, you can’t escape them. And there are going to be times in your business when you will feel other uncomfortable emotions. And it’s much cheaper to learn how to figure out how to hold those emotions in your body and work through them yourself, than always paying to try to avoid those emotions or resist those emotions. 

And if you’re always trying to avoid those uncomfortable emotions in your business, that’s when your business can get very expensive. Your expenses can really chew into your take-home profit, and lead you to overwork and exhaustion and feel really burnout with no money to show for it.

So if you’re feeling that way, it’s taking a look at your business and saying, “Okay, maybe, I have hired too early?” Or, “What software am I trying to utilize to make me feel more organized or perform a certain way in my business, that I actually need to figure out and do myself?”

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When Are Your Business Expenses Too Low?

Let’s talk about the other end of the spectrum for a moment –  under-investing in your business, meaning you’re trying to keep your expenses so low that you’re really avoiding any type of investment. 

There is one time in your business when I don’t feel that you can over-invest in or invest for your own mental and emotional resilience. And so a lot of that comes in the form of coaching and Masterminds and skills as a CEO. Programs that help to develop your skills as a CEO, whether they’re on-demand programs or working with a coach one-to-one

With this, it’s funny, depending on what industry I’m in, for example, a lot of coaches, when I’m in a Coaching Mastermind, coaches are very eager to invest in other coaches and grow their emotional and mental capabilities. And those strategies they’re more willing to invest in at times. 

However, there are other industries, where coaching is not as familiar. Maybe as a yoga teacher or as a massage therapist, or as a health care provider. And in those industries, I see the practitioners more willing to invest in hiring staff to help make their schedule feel better, or software to help them make them feel more organized, professional, and put together. And they’re less likely to invest in the coaching especially for their emotional and mental resilience, or even learn the skills as a CEO.

And I get very curious as to why that is. So I think of my husband, whose investment or risk tolerance strategies are different than mine. And we have that conversation quite frequently, especially because he is an employee. So his paycheck is finite. And also, due to his engineering background, he’s more black and white. So his investment strategy is to make sure that the money is there first, and then invest, where I have more of maybe a dreamer CEO type philosophy that has actually served me well and helped to generate these two, six-figure plus businesses where I don’t always have the money in the bank prior to investing.

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In fact, I believe it’s the investments a lot of the time, especially in coaching, business strategies, and Masterminds, that has helped me to create the profit and create the money. So what comes first, in that case, is my belief in the program, in the work that I’m going to invest in. And I truly believe that it will help to create more money, it’ll help move me through a growth edge, through a plateau that will create more profit on the back end. So for me, instead of having money in the bank, first, it’s belief in myself and the program and its possibilities.

Another reason why you might believe that you need to have money in the bank first prior to investing is because, in the more traditional sense, a lot of advice coming from bookkeepers and CPAs says that is the safer and less risky way to go about it. And so we think it’s the better way, or the only way, and putting money on credit cards, or having business credit cards, I should be specific for business skills, not buying items such as closing cars, but skills or running your business so tight, where you don’t have a lot of savings, or your revenue coming in is really just right there with the expenses going out, is too risky.

But there might be times in your business when you want to run your business that way, a little on the tighter side, or utilizing your business credit cards to help you get ahead. But here’s the thing, if you’re going to go into that type of situation, you really want to make sure that your mindset is on board, because if you take on an expense that has your business running very tight expenses and revenue, pretty much equal or running in the red or net negative, then you want to for sure believe that you have the potential to make much more money than you invest it because if you have a scarcity mindset while you’re doing that, like a lot of fear of investing, it can cause you to freeze and stay in that net negative.

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As an entrepreneur, I’ve been in both those situations where I’ve invested in programs, and I knew I would learn a lot from those programs. For example, I invested in Amy Porterfield’s world both her DCA court, actually all her stuff, and I don’t even know if this is valuable anymore, but she also had momentum membership I was part of as well as McLaren’s world for several years, early on in my business, as well as a Mastermind early on in my business where I didn’t quite have that money to pay for those things. So I ran my business, sometimes in the net negative, sometimes on credit cards, sometimes profit ball but squeaking by. And in the beginning, with all that, it really caused me to freeze in my business. I had such a scarcity mindset, and I overworked a lot to try to outrace that uncomfortable feeling of bringing in more money, I needed to bring in more money.

Now, it was a current thought I had in the background of my mind, pretty much all the time, giving me a lot of anxiety, which actually caused me to overwork, but not bring in the money that I really wanted to bring in. So what it was really when I started to create some more sufficiency and safety and trust within myself, that I started to see more and faster returns from those investments. So I had to kind of let my hands off the wheel a bit, and learn how to trust that what I was doing was working, because sometimes, when we start to implement some of the work that we learn from our coaches and our programs, some of those strategies, you don’t see the effects or the benefits of them right away. 

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In fact, for the Amy Porterfield world, I didn’t see some of the returns on that investment profitably immediately. Immediately, I received great knowledge, I love the knowledge in those programs, I made assets in my business, but I didn’t really utilize those assets, where I saw a return on the profit of my investment until several years after I invested.

Now, that’s not always happened. I find the more sufficient I am in my business, the more belief I have in my business, when my mindset is in the “better or right place.” Then when I make an investment, like I invested $25,000 in a six-month mastermind, I actually start to see the profit in the return much quicker. I saw the profit within that six months of that first initial investment of that mastermind. So it can happen a lot quicker when your head is in the game, instead of having a lot of fear and doubt, which can cause you to freeze out.

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Thoughts That Help Me Stay In The Place Of Belief And Trust In Myself 

To help stay in this place of belief and trust in myself, I have a few thoughts that work for me when I’m investing, especially if I’m investing ahead of the money that I actually have bringing in. They are thoughts like, I will create more money, I will utilize these skills, and it will bring in more money, I will bring in more money beyond this investment.

One of the personal thoughts that I really love is when I give myself and my business what it truly needs, then I create more time and more money with ease. And I’ve proved that to myself over and over and over again. And when I say I believe, and then I invest, and then that creates the profit and the money. 

I’m not saying I’m doing this over and over again, back to back to back. I believe there are times when I do that, where I might invest in a few things at the same time, where I’m investing in them to bring in and grow my business, and then when I hit that growth, or I finished those investments, I utilize them, I maximize them to the most of their capabilities.

So for several months, I might not invest again until I really feel and reap the rewards of that and profit. And until I feel the growth of that new self-concept, just become the “new me,” then I will slowly start that investment process again, when I’m ready to go through another growth edge, when I’m ready to ramp things up again. 

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And when I say I start slowly, I might just start with one thing or one small investment to get back into that cycle and wrap myself up again because there’s no way that you can be growing and improving your concept 24/7 in your business week after week in your business, it’s just not sustainable.

So there’ll be periods of growth in your business, both profit, and then there’ll be periods of adapting. To that adapting, to that new revenue place adapting, to the new CEO that you’ve become with the new skills and team or abundance of clients that you created. You need to really savor that and be in my Coaching calls, be in the having of those before you ramp yourself.

So again, it can come in waves. And for me, it looks like a graph where the lines are continuously heading upward. But there are periods of plateau, plateau as the line moves up, up the graph. So personally, the process I use to make decisions on what investments to make and when is to visualize what I want to create.

So if I’m coming out of a plateau, or a place of having, and I’m feeling very stable in what I’ve created, and the person I’ve become, then I start to visualize, “Okay, what is that next step? What do I really want to create in my business next? What does that look like?” And then I figure out who, maybe a certain coach or what type of program, like a Mastermind or an on-demand program is going to help me create it.

Knowing Where And Who To Invest In

So this is where you can really utilize those moments in your business where you have this shiny object syndrome, maybe it’s the coach that you want to work with, or the program that you want to invest in, or that ad that you saw, a Facebook ad, save those, create a folder in your phone, or in your drive and save those because, for me, I visualize what it is that I want to create. 

And then when I figure out, “Okay, what is it that I want to do next in my business?” then it’s a knowing of, “Okay, what type of program is going to help me get there?” because there are so many different types of coaches out there, so many different types of programs out there.

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And I really feel that the majority of them, and maybe this is only because I’ve picked some great coaches and programs that I’ve worked with, I’ve always gotten a return on my investment in everything I’ve invested with. I can’t even think of something where I was like, “Well, shoot, that was a waste of money.” Maybe, maybe there was, but I really, right now, can’t think of anything. It’s because each program that I’ve invested in, and I’ve invested in a lot, is slightly different. I’m always gleaming the pieces of the puzzle where maybe I was lacking before, each program always provides an insight from a slightly different perspective or a slightly different focus.

So how you choose what to invest in is really dependent upon where your gap in knowledge is or where your gap and skills are. But you can only figure out that gap if you know where you want to go. So you have to really visualize, “Okay, what is it that I want to create? Where’s that gap? And who can help me to fill that gap?” So that’s how I really figure out the order, or know what to prioritize in my business.

So, for example, I invested in the 200k Mastermind, because it was filling the gap of my mindset work and specific business skills. I invested in my trauma coach, or emotional resilience coach, because I was lacking in my emotional capacity to earn emotions in my business without wanting to run away or resist or avoid. So I invested in them at similar times, but they were for different purposes. And together, those purposes complemented each other to really skyrocket my revenue and profit.

And as you read from the blog where I had Julie with me, people in my real world really saw the transformation of me personally and the transformation of my business. And that’s how it’s happened, by figuring out the gap, and believing in myself first, and then investing. 

So when I figured out what the gap was, and what would help me to get to where I wanted to go, then I made the investment with those, the 200k Mastermind and with my coach, for example, I showed up, I believe that it was exactly what I need, I got what I came for, I implemented their advice and their strategy, I was open to coaching, I was open to changing which is not comfortable, right?

This work is not always comfortable. I’ve gone through my own river of miseries of trying to implement, failing, failing, hard trying again, tweaking, but then the end result of all that is these transformations where if you look on the outside and outside are looking into my business, they say me personally growing and they see my business personally growing and it can happen for you too. 

Sometimes it’s easier, though to just avoid that whole process. And when you see an investment, not knowing how it might fit in your business, especially if you don’t have that roadmap of knowing where you want to go in your business, and so then it’s easy to say, “Ah, I’m giving up a 10k, I could spend that on a down payment for a car,” which I’ve done many times over, I’ve invested in my business, instead of investing in the car. Thank goodness, I have this amazing Honda Fit that just keeps going and going and going. Or the 5k that you’re giving up, which could be used maybe for a vacation for your family, only you decide when you want to invest.

Make Sure You’re Also Investing in Other Important Things Even if it Means Sacrificing Your Profit for A Month

So you do want to make sure you’re not always working in your business, so you can enjoy the future later. There are times when I do decide to invest in vacations for my family, or maybe have a decrease in profit and revenue one month, because I want to take more time off. 

When you’re looking at the big picture of your business, it’s natural for some months to not be as profitable or your revenue, not to be as high. But if you’re thinking the big picture of your business, you shouldn’t allow that one month to really freak you out. Because it should almost be planned for, it should be taken into account that there are going to be some months that just happen that way or especially if you’re on vacation or taking time off. 

Or for me, recently having to process my brother’s passing, life happens, and you want to be able to enjoy and live your life while growing your business. So when you’re planning investments, it’s also taking into account the big picture of your life and your business, and what you want your whole year to look like. 

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And that is why I really help my clients, one of the first things we do is take a look at their schedule, and their energy, and the numbers of their business right off the bat. Because all of these are like pieces of a puzzle where if you put them all together, it might take a little bit of shuffling and sorting through, but then eventually the puzzle should come together where it fits, and it feels more, you should be able to approach your business with more ease instead of trying to fit together puzzle pieces that aren’t correctly cut out to fit together.

So if you have the big picture of when you’re going to take vacation, the roadmap of what you want to create and accomplish in your business for that year, then that makes planning for investment feel more organized and more prepared, instead of spontaneous, which then sometimes that leads to the pressure to make your money back and/or the guilt.

However, there’s been times like, for example, I am making the decision to invest again with my emotional resilience coach to go in for another round. This was not a planned investment. However, I’m realizing in my business right now that I’m feeling a little stagnant because I haven’t fully processed through my brother’s passing, there are still some emotions that are feeling stuck in my body. And that’s leading me to feel stuck in my business as well. Not that my business is actually stuck, it’s actually doing quite well. It’s just how I’m feeling. And I want to hire her to process through that to prevent my business actually becoming stuck, because I feel stuck. You see how that works?

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So I’m going to invest to help process through that and to really figure out what I want to create for the remainder of the year. So I have a very clear roadmap of how I want to feel, and what I want to visualize and create for myself, for my business, and also for my personal life for the remainder of the year. And when I have that clear roadmap, then the investment becomes a no-brainer, even though it wasn’t planned. But I really do feel that it will help create more fulfillment in my life, time freedom, and more money down the road.

There might be times in your business when you’re planning certain investments, and you’re going to look through that folder of possible coaches and programs you want to do, and you’re going to decide, “Okay, I’m going to go on vacation during this month, so my revenue might be lower, and I might have less time so that might not be a great time to start a new program. But maybe I’ll do that in the month after when things are ramping back up, and the gap in knowledge I have for what I want to create is this, so then I will choose that program,” right? That’s kind of more of the ideal way, knowing, however, life is going to throw you curveballs.

So sometimes unplanned investments might be needed, in which case, having savings is very, very helpful. And sometimes, that’s when I do utilize a business credit card, which I pay back most of the time very quickly. And I look at if I spend an extra, the money extra investment, what’s the word, interest, that’s what if I’m paying a few $100s, or sometimes even a couple $1000s in interest, but I’m able to gain skills that will help me achieve six figures or more, bring in $1000s to my business, then that is being on the plus side of the profit for the big picture. But you have to have trust in yourself that you’re going to keep going, you’re going to keep taking steps forward, or else you don’t earn that profit back on that interest.

But you get to decide, you do you, there is no right or wrong way. Or even if you plan for the ideal way, sometimes that happens, and sometimes it doesn’t. And that is okay, don’t beat yourself up for your expenses or investments. Instead, choose to believe that they’re stepping stones to get you to where you want to go. And in that case, you’re always on the winning side.

So you get to choose your pace, you get to choose your path, and you get to choose what you want to feel during the process. Just be truthful with yourself when making the investment, the reason why you make the investment, and be aware of what you might be trying to avoid emotionally, for example, and then you’ll make honest investments that can lead to bigger and faster growth in your business. 

And when I say faster, again, that doesn’t always mean profit or revenue. There are many different ways that you grow, which all leads to overall profit and revenue growth over the years.


So remember, big picture strategy, take it one day at a time. And if you feel overwhelmed, just ask yourself, “Okay, what’s the next smallest step I can take right now,” the next smallest step you can take right now to help you achieve that goal. And then the rest will unfold, II promise you. 

And if you feel stuck, of course, I’m here for you. Just jump on a consultation call. It’s free. And I will see you next week. Bye for now!

Must read: 

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Enroll Now: The PATH TO PROFIT Workshop (FREE!)


Alison McLean

"I help the Entrepreneur reduce stress and live a more fulfilled and balanced life."