Those same mindset issues and bad habits that wreak havoc in our personal finances can plague our businesses as well if we’re not careful.
Some things are just hard to resist—especially when your friends and colleagues are all jumping on board! New tools, training, group coaching programs and even business models can all have a strong pull, and if you aren’t careful, these shiny objects can quickly distract you from your current goals.
If you find yourself catching shiny object syndrome frequently, try this two-step plan instead:
If you’ve ever said to yourself, “I’m not using this subscription, but I can’t give it up! I’m still paying the launch price, and now it’s much more expensive!” Then you’ve fallen for the sunk costs fallacy.
This common mistake is famous among economists, and we all fall victim to it from time to time. Simply put, the sunk costs fallacy is what makes us justify investing more money or time in something—even though we’re not seeing results—because we’ve already spent so much. It’s what encourages us to repair the car one more time (after all, you just put new tires on it), eat a meal we don’t enjoy (simply because you’ve paid for it), and yes, continue to pay for tools and resources you’re not using.
Take a few minutes and examine your current business expenses. What are you paying for month after month that you’re not using? Either make a plan to put them to work for you, or cancel them. Stop falling for the sunk costs fallacy.
You thought this was all going to be about overspending, didn’t you? Here’s the kicker: Spending too little is just as bad for business.
When you’re constantly on the lookout for free and low-cost tools or working 16-hour days because you “can’t afford to outsource,” you’re not doing your business any favours. Sure, it looks like you’re bootstrapping and working hard to make something from nothing, but what you’re doing is digging yourself a rut it will be nearly impossible to climb out of. Not only that, but you’re reinforcing a scarcity mindset that will continue to plague you for years if you let it.
Rather than pinching pennies, learn to spend money strategically. Buy what you need, when you need it. Invest in top-quality products and programs rather than settling for the low-ticket, half-baked plans. Just like quality clothes, cars and furniture, quality services, and software last longer and work better. And unlike that car, good quality business tools will pay for themselves.
I am hosting a free webinar ahead of the launch of my brand new course Abundant Attitude: Master Your Money Mindset in Seven Days.
Sign up here and join us at 10am BST on Thursday 7th May 2020 to learn my top Five Money Mindset Steps to Transform your Business and Income.
Sam is the founder of Small and Mighty Co. A transformational coaching business and marketing consultancy specialising in supporting small and mighty creatives grow with confidence and achieve their dreams, in business and beyond.
An accredited NLP Practitioner Sam’s specialities include mindset, motivation, marketing and modern-day consumer behaviour and is well known across the small business industry for her savvy straight-talking advice; with regular speaking appearances at major events across the UK and features on the BBC and Channel 5 News.