Building a Better Nest Egg

Just when things are going smoothly and we feel like we have the world by the tail, along comes a nasty curveball.  

No one could have ever imagined what a full-on National emergency would do to the average small business owner.  

Were you prepared?  Is your nest egg compromised?  What are the lessons learned from an unforeseen crisis?

As life starts returning to normal again, it’s important to begin taking the steps to rebuild your business to be even better than it was before. 

Building a better nest egg can be part of that plan.

FIRST – Create an Emergency Fund!

Don’t confuse a nest egg with an emergency fund. 

An emergency fund should contain enough liquid assets (preferably cash) to sustain business expenses for at least three months. 

Depending on the size of the business, and the risk of industry/market fluctuations, the emergency fund may need to cover a much longer period.

Successful business owners have a plan for life’s unforeseen circumstances. An emergency fund is one of the basic strategies in a business plan.

It’s a sobering feeling when an emergency expenditure comes up and the funds aren’t readily available.  Illness, injury, or an HVAC system replacement, can cause catastrophic outcomes for a business that isn’t prepared.

Once you’ve secured a sufficient emergency fund, begin building a better nest egg for added future financial security.

6 Steps to Building a Better Nest Egg After a Crisis

1.  Make building a better nest egg a priority.

Change your priorities; change your life.  To change your priorities, start with the end in mind.  Determine what it is that you are trying to achieve.  

If it’s important to you, you’ll find a way.  If not, you’ll find an excuse.

You can’t make something a priority if you don’t understand it’s purpose.  Do some deeper thinking about the purpose of your nest egg.  Determine why building a better nest egg is important to the future of your business and your own wellbeing.

2. Track revenue, expenses, profit/loss monthly.

Before setting a realistic nest egg goal, you need to know and understand your financial numbers. 

If you’re blindly paying bills and making bank deposits, you’re leaving a lot of opportunity on the table.

“That which is measured improves. That which is measured and reported improves exponentially.” – Karl Pearson

Get a system in place, like this one, that makes it easier to manage your monthly financial record-keeping.  

3.  Set a nest egg goal and timeline.

Once you’ve determined the potential for building a better nest egg by studying your financials, set a realistic goal.

The moment you put a deadline on dream, it becomes a goal.

To assist you in setting your goals, download my Triple Target Goal Grabber.  Then check out Make Your Goals a Priority; be a Goal Grabber to get more inspiration.

4. Identify additional revenue opportunities.

There is always a way to generate additional revenue.  Begin with identifying the specific customers/guests your business attracts. 

Think outside the box.  New 2020 Travel Trend – Slow-Mo is In #FOMO is Out and How to Make Your Vacation Rental Workcation Friendly has some ideas.

Explore additional platforms to market your business.  

Social media marketing is free and will not only generate additional customers/guests, but it will also generate trust for your business.

5.  Identify opportunities to cut expenses.

Living under a budget is not the most exciting thought to a seasoned business owner.  But when you start thinking in terms of want vs. need for each purchase you make, you’ll begin to be more aware of your spending habits.

Prioritizing the goal of building a better nest egg makes purchasing decisions easier.

Review your last three months personal and business expenses – every single purchase.  Go through each purchase and identify if it was a need or a want.  This will be an eyeopener for ways you can begin building a better nest egg.

6.  Start “snowballing” high interest debt.

Interest rates are incredibly low right now.  If you have high-interest debt, consider the benefits of refinancing at a lower interest rate.  This could save thousands of dollars over the life of the loan.

In the meantime, make some additional debt payments.  How You Can Tackle the Debt Snowball explains how you can use the snowball-effect to quickly pay off debt.