Business Consultant, Pria Masson, helps us explore the ‘story’ that our money tells us in this edition of ‘Money and You’.
I have recently started studying psychology and I was not so surprised to see that money, or rather our reaction to money, is one of the anomalies that make us human almost. It’s something that we want just for its own sake, it rarely seems to be enough, and we can be manipulated with it. However, in a sort of utopia, I would prefer that you learn to manipulate money so that it can work for you. So, continuing with the ‘money and you’ theme, this month, lets understand the stories that money tells us about ourselves and our lives. I do not promise it will be a pleasant story to read, but it’s one you need to understand very well to not be a victim.
I will begin with my favorite mantra: “numbers do not lie – unless they are manipulated”. With that in mind, what do the numbers of your life tell you? I will begin with the easier one – business numbers. I have spoken about the power of unit economics previously but as a recap, each unit produced, needs to break even at the minimum when you start and eventually needs to be profitable. If that does not happen, no amount of overhead costs can really justify sustained losses. For example, if you sell cupcakes at BD1 per cupcake, and you believe that you have priced accurately, then, at a certain number of cupcakes, the machinery, equipment etc. will all be covered, and you need to make money. The reason why we give it that time is because price is not always a seller’s choice. To stay in a business despite an unviable market set price – that is a choice.
Let’s extrapolate that to personal finances. If each month, you are at a nearly zero balance, or, if you are taking up loans to sustain your life, for how long is it all sustainable? Like in a business, you sometimes have things cooking in an oven that will give you money eventually. If that’s the case, then this model is sustainable up to that point. It’s never indefinitely sustainable and some changes will need to be made. Re-budget, prioritise differently and ask yourself some hard questions because, numbers are the story of how you’re living your life. The good news is you can change the story – usually with a few simple changes.
What story do you want your numbers to tell realistically? Have you placed your expenses (personal or business) into buckets of essentials, nice to have and luxuries? Are you certain what you consider essential is truly essential? Could you perhaps re-prioritise some things? That business line that’s not making money, which you have your heart set in, could it be what is draining you? I know that the story might not be easy but read it any way. Once you understand where the turning points are, you will be surprised at how the ending turns happy pretty fast.
Pria is an experienced business consultant who works as a business coach and advisor helping clients with their strategy, business plans and idea assessments. You can follow Pria at her Instagram handle @guide-_my_idea and know about her experience at www.priamasson.com
