TruckTalk:
LESSON 9
The Power of Financial Clarity
By Kevin Rutherford
It’s time to take a hard look at one of the most important parts of your business—your money. I know, talking about finances can be uncomfortable. But guess what? If you're serious about running a business, you need to get comfortable with it. So let’s dive in.
One thing I’ve learned in my years of helping people build their businesses is this: financial clarity is everything. Without it, you’re just hoping things work out. With it, you’ve got a plan.
So let's talk about money, net worth, and the importance of understanding where you stand financially—not just for your personal life, but for your business, too.
Why Net Worth Matters
When I first talk to people about their finances, I often ask them one simple question: What’s your net worth? And you know what? Many of them don’t even know how to answer.
But it’s simple. Your net worth is just the difference between what you own and what you owe. Add up your assets, subtract your liabilities, and the number you’re left with is your net worth. Positive net worth? Great! Negative net worth? Not so great.
Now, why does this matter for business? Your net worth is a crucial measure of how well you’ve managed your personal finances. If you can't manage your own money, what makes you think you’ll be able to handle business finances? You won’t. The reality is that your personal financial habits will follow you into your business. If you’re not good at managing your money now, expect your business finances to look exactly the same—only worse, because there’s more of it to manage.
The first thing you need to do is figure out where you stand financially. This is the foundation upon which you’ll build your business. And if you can’t get this part right, the rest of the business will be shaky at best.
The Tough Truth About Money
Here’s a tough truth—facing your finances isn’t easy. It’s uncomfortable, especially when things aren’t looking so good. But if you ignore it, you’re only making things worse. The longer you avoid facing the reality of your financial situation, the harder it will be to dig yourself out.
But here's the thing: the longer you put it off, the worse it gets. If you want your business to succeed, you have to get a handle on your money. And that starts with taking an honest look at your current financial situation.
The Importance of a Plan
I’ve seen too many people who start their business thinking they’ll figure out the money stuff later. Here’s the problem with that: money doesn't wait for you. You need a plan. When you know how much money you need to survive for the year—your minimum living costs—you can plan for what your business needs to bring in to cover those costs. If you can’t get your business to cover those basic expenses in the first year, you’re in trouble unless you have a cushion to fall back on.
Think about it. If your living expenses are $80,000 a year and you expect your business to bring in only $65,000, you’re already facing a $15,000 shortfall. This is where many businesses fail—because they don’t know what they actually need to make, and they don’t have the resources to bridge that gap.
The Fix: Financial Discipline
The key to financial success, whether personal or business, is discipline. It’s not about making more money. It’s about being smarter with what you already have. This goes beyond just cutting expenses (though that’s important). It’s about having a financial plan, knowing your numbers, and making sure every dollar you spend has a purpose.
But here’s the real kicker: Success doesn’t come from what you get—it comes from what you give up. If you want to grow your business and build wealth, you're going to have to sacrifice a few things. The road to success isn’t about living large—it’s about living smart.
Action Plan
- Do a personal financial audit. Write down your net worth—every asset and every liability. Don’t guess. Get real with yourself. Knowing where you stand is the first step to moving forward.
- Calculate your yearly expenses. How much do you need to survive for a year? Include everything—housing, food, insurance, maintenance. If it’s money out, it counts.
- Assess your business model. Can your business realistically cover those expenses? Be brutally honest about your numbers and projections. Hope isn’t a strategy.
- Use ProfitGauges to get clarity. Tracking your profit and loss shouldn’t be a headache. ProfitGauges does the heavy lifting, so you can make smarter decisions with clean, simple data that actually tells the truth.
- Create a budget. Whether it’s personal or business, you need to know where your money’s going. Track every dollar. If you're bleeding cash somewhere, fix it now—not later.
- Tune in to the AudioRoad Network. We talk business every single day. Call in. Ask questions. Challenge your numbers. Stay plugged in—because growth only happens when you stay in the game.
Ask Yourself
- Do I know my current financial situation inside and out?
- Have I built a budget that allows for growth and stability in my business?
- What am I willing to sacrifice to make my business successful?
Closing Thought
Money management isn't complicated—it’s just uncomfortable. But facing your finances head-on is the first step toward true business freedom. If you get this part right, the rest of your business will follow. The question is: will you take control now, or wait until it’s too late? The choice is yours.
Stay sharp, and let's make this year one for the books.
