financialtreat – will explain about Managing Billionaire-style Family Finances that you will get in the following article. Let’s look at this article carefully!
Financial management is one of the important factors in determining the success of a business. Given that finances are a vital issue, the details of the flow of funds out and out must certainly be clear. Profit is a common goal for every company.
Therefore, it is important to know how to manage good finances including managing costs, budgets, and income. The role of financial statements becomes very crucial so that financial management becomes more organized. If you manage your finances properly, the company’s fund flow will be healthy.
Many motivational speakers suggest if we learn something learn from people who are already successful. If you want to be rich, learn from people who are already rich. Well, this time we will review billionaire-style financial management tips.
What is Financial Management?
Financial management is an activity that regulates, plans, directs, and supervises financial activities such as expenses to buy equipment or income from the sale of products.
Financial management is trivial for some business actors because this term itself is still rarely understood by people. In fact, not only useful for the business world but financial management can also be applied in everyday life.
If the previous financial management was only around the efficient use and allocation of funds, now financial management also covers a wider range. This can be seen from the scope which includes how to get funds, use of funds, asset management, to investments.
Billionaire Financial Management Tips
Being a billionaire, who wouldn’t want to? Most of them are successful business people whose businesses have been run for generations. Nothing is instant, everything requires hard work and process.
Let’s take, for example, Chairul Tanjung who became the fifth richest man in Indonesia did struggle in his youth to be able to occupy the position. Not ashamed to open a photocopying business on his campus first, a medical device business until he had gone bankrupt, life was difficult to go through. But now he can reap what he has planted first.
No different from other billionaires, after getting the title of rich man, they still have to manage their finances well so as not to go the wrong way. Set up finances where it’s good, never to your detriment, really. That’s why you can copy the way billionaires manage their finances here.
Don’t think short about money
Billionaires have a habit of not only thinking about today but also thinking about tomorrow. That’s why they are not easily tempted by momentary pleasure. Because for them, it won’t help make you rich but will only hurt your future.
Try to stop making decisions that only make you happy right now. Think about the days to come too, don’t mess it up. Although billionaires like to buy expensive things, they prefer to choose those that also have investment value in the future. So it is not only good to use at this time but also useful in the future. You may be able to prefer to buy gold with a budget of Rp 1 million, rather than buying shoes / clothes / bags at the same price.
Consider the cost of debt interest
If you look at the abundant wealth, these rich people still calculate when it comes to debt. They will really consider the large increase in the cost of an item they buy with debt. Because after all, the price of goods we buy with debt will become more expensive than the goods we buy in cash.
Do not let your money run out just to pay for the increase in costs. Debt is certainly okay, but it is recommended in the form of productive debt that will be used as business capital. At least your business turnover can produce profits that are commensurate with the amount of interest that must be paid.
Instead of debt, you better get used to automating savings/investments every month. It turns out that this is a habit that billionaires also do. For example, pay cuts automatically to be put into a retirement fund account or a child’s education savings account.
They believe in investing so much that they make it a habit. Roy Sheppard, a British millionaire and financial expert, said, “Save 15% of everything you earn for the rest of your life.”
Live within your means
Still connected with the previous point. When you have activated the investment/savings fund auto debit arrangement, you can take the remaining funds and do whatever you want with the money. By making investing/savings a priority, you won’t spend more money than you can afford.
Money is a long game. The more you start investing at a young age, the luckier you are because there is plenty of time to let the money grow. It’s an easy way that billionaires do to raise money.
They also have the principle of spending less money than they can make. They can, surely you can too! Isn’t living within your means can make life more comfortable? Yes, you can be yourself without having to care about what others say. Don’t live just because of prestige, because in the end, it won’t make you happy. Importantly, your future is safe in your hands.
Have a goal to be achieved
Billionaires know very well what their goals are. And they know what it takes to realize that goal. Starting from mapping the budget to save/invest so that the goals they have can be achieved immediately. Often, when you don’t know what you want and don’t have financial goals, you’ll only use money as a means of meeting your current needs.
Money cannot be used in the long run so the term “living from paycheck to salary”. Don’t get you stuck in it. From now on, decide what goals and desires you want to achieve in life, then find out how much it will cost, and try to do what you have to do to achieve them.
Josh Simon, a young American millionaire said, “Find out how you want to live in retirement, determine the cost, and then come up with a strategy to make it happen”. What does it mean? To be able to live a quiet life without the need to work needs a surefire strategy.
Want to learn about financial literacy
It’s not that rich people don’t talk about money at all. They talk about money all the time. They want to learn about financial literacy in order to manage their financial affairs well. And They also have a much more established financial awareness around income management, investment strategies, asset management, to debts.
They actively seek information from financial experts or mentors. They do not hesitate to consult to obtain important information about personal and business financial management. Well, you can also do it – for example, consult about investments with representatives in banking institutions, chat with accountants / financial advisors, or you can find your own references to do research.
The point must have the will and do not be lazy to learn it. If indeed you find it difficult, do not hesitate to consult with experts.
Mistakes in Financial Management
There is nothing wrong with you expanding. But you also have to remember whether the expansion actions you take can already support your main business. Do not let, your expansion even disrupts the finances of the main business, even though the business has not benefited so much from you.
If you keep forcing yourself to be too expansive, it could be that your main effort will be destroyed. Because the capital you provide cannot cover your side business. Try to make you focus on the main business so that the business you run can run on its own. The mistake of managing business finances that are too expansive will make your business more chaotic and expenses out of control.
Never Evaluated a Business
The business you run requires an evaluation. As an entrepreneur, you should always evaluate the business you run. Because, if you never do an evaluation, then it will be very difficult to what are the shortcomings that occur in your business. Even though this evaluation is very important, it’s a good idea to do a routine evaluation, especially the evaluation of financial problems. Whether it’s daily, weekly, or monthly evaluations you should always do it.
Mixing Business Finance with Personal Finance
The most common mistake among Indonesian entrepreneurs is that it often mixes business finance with personal finance. Though this is the most crucial problem, and mistakes in managing business finances that often occur.
Another mistake that is often made by entrepreneurs, they never teach themselves. Even though this is important, with the salary you get from your business, then you no longer need to interfere with business profits just for personal interests. Well, how? Do you know the tips for managing billionaire-style finances? Good luck!