Basic Financial Administration

2 This is a business – you have to be aware of your expenses, income etc.

3 Basic Financial Administration Mary earns £500 per month John earns £1.000 per month Who has more money? John? Mary spends £450 per month John spends £1.100 per month No! Those who earn more, are not necessarily those who have higher revenue but those who manage their cash flow better! ?

4 Knowing your numbers: how much do you need to live? In the first few years, don’t change your lifestyle Establish priorities Remember, you won’t be able to retire over night! Be realistic Basic Financial Administration

5 Fill in the monthly expenses table according to the example bellow : Planed expensesPaid expenses Rent Transport Groceries Electricity + water Telephone Other (lunch, clothes…) TOTAL: £250 £25 £170 £70 £18 £20 £553 £250 £32 £200 £66 £38 £15 £601 How much do you need to live?

6 If you spend £601 per month how much do you have to earn, minimum? £601! Basic Financial Administration

7 Surviving Shopping (passive) Dreaming (active) 1.What you earn today is only to pay for what you spent yesterday 2.What you earn pays for everything but there is nothing left 3.What you earn pays for everything, there is a little bit left but you don’t know what to do with the money 4.What you earn pays for everything, there is money left and you make it work in your favour What is your actual situation?

8 In order to balance our finances we have to know: How much we spend (expenses) How much we earn (income) Successful people work towards increasing their income Basic Financial Administration

9 Principles of income: 70% - to live 10% - to re-invest 10% - savings 10% - to donate Savings: For unexpected situations and the realisation of your bigger dreams e.g. holiday To live: how much do you need to live? Take note of your personal expenses and make adjustments to it so they are not superior to 70% of your income. To re-invest to generate more income: What do you think we should re-invest in? To donate: If you don’t donate now when you have little, you will not do it when you have lots...? In new stock and products to promptly deliver Supporting material like catalogues, flyers to promote your business… Training, books, business education

10 – Fixed expenses: We can’t avoid them – it happens every month, we can vary the amount. Example: water and electricity bills, children’s education. – Variable expenses: It can eventually happen during the month. These are the expenses that can be controlled. Example: a new fridge, dinner out, cinema Expenses can grow… keep a close eye Keep your lifestyle as it is... At least for now… Your FOCUS is your biggest trait, don’t do anything or buy anything that may distract you Basic Financial Administration Work out your monthly budget Take note of you expenses and income, keep track of everything: fixed expenses and variables ones

11 Re-stock your products periodically for prompt delivery, and care about your capital Keep some IBP Kits handy if you are really interested in developing a successful organisation. Brochures, catalogues, publicity = investment: increase your activities Basic Financial Administration

12 Basic Financial Administration 90 days plan – establish you targets! To reach my ideal weight in ____ days To talk to _____ new people every day To take home a profit of at least £______ every day To read every day for at least ____ minutes To watch a support DVD every day for at least ____ minutes To attend training events Ask your sponsor/supervisor to assist you finding the best tools to build up your profile

13 Basic Financial Administration Daily Action Plan Take note daily: Number of contacts/visits: _____ Total earned: £ ________ Other Sales: £ ________ Number of leads: ________ I spoke to _____ new people Profit for the day: £ _________ Ask your sponsor/supervisor to assist you finding the best tools to build up your profile

14 Basic Financial Administration Open a business bank account, keep you personal bank account separately Protect your business financially Do not borrow money, nor borrow products, and do not be anyone’s guarantor Always negotiate and never pay your bills late so you will not accrue interest Invest in training sessions, don’t choose particular sessions, attend all of them Improve your personal presentation (clothes, shoes, presentation folder etc.). Invest money in good books. Save at least 10% of everything you earn