Why You Need Financial Goals in Your Holistic Business

Money is an interesting topic for many holistic practitioners – some are comfortable with earning a good living whereas others struggle. But if you want to thrive, you need to earn a living, and that means earning money.

The starting point is knowing what you need to earn. If you don’t, you’ll end up drifting along and hoping things work out – well it’s time to change tactics!

Do you set yourself a revenue goal each year – the money you want or need your business to earn?

Here’s what you need to consider:

Personal Income

Your business needs to be generating enough income to pay your salary. Work out the following figures:

• What’s the minimum wage you need to earn to live?
• How much do you need to make to live comfortably?
• What do you want to make to have an amazing life?

When you write down the figures, how do they make you feel? If it’s uncomfortable, you’re on the right track. It’s about stretching yourself to start earning a living that’s right for you.

This amount will be different for everyone - it’s getting to the level where you feel financially secure and have the resources to live your life fully.

Whilst the second and third figures may not happen in the next year, it gives you amounts to aim for. And knowing them means your brain is working away in the background figuring out how to make it happen.

Note: Remember to allow for any tax you need to pay here too.

Business Costs

When you set your revenue goals, you need to take into consideration how much it costs you to run your business. There will be monthly costs such as mobile and internet, but you will have annual fees too such as professional fees and insurance. As a business owner, you need to know these.

Your business needs to cover all these costs on top of what you want to earn personally. Keeping a reference of these costs helps you manage your business expenses and understand where you’re spending money.

Allow for a Buffer

Having a buffer means you have cash in the bank available for any unexpected bills or if work is quiet for one month, you will still be able to pay yourself. It is a great way to build sustainability into your business and can be built up over time. Consider what a good amount would be as a buffer for you.

Setting Your Financial Goal

Adding your income, business costs and buffer together, how much does your business need to earn this year?

Understanding the different totals between basic living and thriving will help you to decide on your revenue goal for this year.

This will be different for everyone; you may want to earn enough so you can leave your day job so you can set the minimum income goal. You could be in a position where you’re surviving and want to get comfortable, or you’re looking to step it up and thrive.

Knowing this figure will help you determine what work and marketing you need to do to achieve it.

Break the Figure Down

It’s one thing to have an annual goal, but what does this mean to you and your business at a month-by-month level?

Breaking it down into months and then again into weeks and days will help you to understand what’s possible.

So, for example, if you wanted to earn £36,000 a year – your income breakdown would look like this:

• £3000 per month
• £693 per week
• £99 per day (7 days a week)
• £139 per day (5 days a week)
• £231 per day (3 days a week)

You will have to build in allowances for holidays, seasonal highs, and lows etc., but this exercise will help you to understand what it will take to earn what you want to.

Reality Check

This will help you put things into perspective – you need to work out how to achieve the income you’re looking for.

There’s no point in setting an income goal if you have no way of knowing how you will achieve it – it’s just a dream.

Based on your figures, work out what you must sell to achieve them:

• How many services or products to achieve your goals?
• How many client appointments do you need to sell?
• Do you have the capacity to offer this many?
• Do you have enough products to sell?
• How does this compare to what you achieved last year (if you’re already working)?
• How does this knowledge affect what you do next year?
• Do you need to put your prices up?

Start asking yourself if this is achievable, and how you can make it achievable.

It’s one thing knowing what you need to earn, but you need to have a plan to achieve it. Without it, you’re just hoping that it will all come together.

Join me for my Planning to Thrive Live Online Workshop

10am - 2pm GMT on Saturday 2 December 2024

Come along and show your small business some love on Small Business Saturday.

Think of this as a mini-retreat for you and your business on Small Business Saturday. I will help you create your simple plan ready for 2024, so you know what to do and where to direct your marketing efforts. Imagine being able to enjoy the holidays knowing exactly what you need to do to succeed in the New Year. Get the full information here.