Pinoy Business Coach

We mentioned a lot of tips in the part 1 of this article which you can access it here. Part of the issues of financial management is the fact that start-up or new entrepreneurs need to raise sufficient cash to be able to start a business or expand one for that matter.

The most basic of being able to financially manage your future company or to efficiently run an existing one is by focusing on YOUR OWN PERSONAL finances.  By setting time and effort to effectively maintain financial records of your income and expenses on a daily basis, you will be disciplined to think in terms of cash flow, income statements and balance sheets.

Most people are threatened when they hear those big words that form a financial statement.  I used to be afraid of these words also until I realized that the fear came from the fact that I did not understand them at all.  By starting to record my daily expenses and knowing my income on a weekly basis, I was able to start a life-long habit of being able think in terms of cash in and cash out and to know my cash position.

Cash position, by my understanding was the current cash on hand and any income coming in, before any major payable.  When I was able to understand how this works and forecasting payments at a personal level taught me how to 'save-up' and not spend those precious pesos until I was able to pay that coming bill or financial obligation.

Some mock the Chinese for being diligent record keepers of income and expenses, but from my point of view, all that mocking is in vain for there lies the secret to the skill of Cash flow Management. Today. my wife and I are consciously listing our expenses and incomes on an excel file and review them constantly to determine the cash position.  If the cash is not sufficient to pay a coming financial obligation then we use the time before that bill is due to find the cash or funds to settle that obligation when it becomes due.  Talk about great training for our imaginations and resourcefulness.

These are skills that are not taught in school which I think that we all need to develop.