Why the Balance in Your Bank Account is Not Your Profit

“A common mistake that entrepreneurs make is checking their bank balance at the end of the month and assuming that what is left is their profit.”—Melissa HoustonHeads up: your bank balance does not equate to your true profitability. Doesn’t mean that you have all those money in your bank account, you’re free to spend them all you want. No—that’s not your profit yet!As business owners, we need to get our money management system tied up so that our profitability is optimized. And one way to do that is to keep an eye on your bank account.My personal tip: I look at my bank account—both business and personal—every. single. day.I’m not kidding. I’m not exaggerating either. In this episode of She Means Profit, I discuss why I find monitoring my accounts on a daily basis an essential powerful way to manage my money and optimize my business. I also break down the reasons why you should never think what’s in your bank account is your profit.Listen to learn:‌Planning your goals for 2024Why keeping an eye on your bank account is essentialCash flow vs profitMistake 1: Assuming what remains in your bank balance is your profitMistake 2: Not paying yourselfMistake 3: Unpaid debtsMistake 4: Overleveraging your businessMistake 5: Accounting methodsThree ways to work with meHighlights:‌01:37  Little catch-up from the season break02:18  Cash Confident: An Entrepreneur's Guide to Creating a Profitable Business02:50  Cash management system05:50  2023 Q4 planning and getting ready for 2024 planning06:44  Checking my bank balance every day08:37  Mistake 1: Assuming what remains in your bank account is your profit09:00  Mistake 2: Not paying yourself10:11  Cash flow vs profit11:43  Unpaid debts12:42  Overleveraging your business kills your cash flow13:36  Accounting methods15:37  Three ways to work with meLinks:‌ ‌Cash ConfidentMain websiteMini-course: The Debt Repayment CalculatorMini-course: Pay YourselfMini-course: Personal Net Worth CalculatorMini-course: The Ultimate Budget BinderFollow me on:IG: @melissahoustoncpaLinkedIn: @melissahoustoncpa