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How to Start An Online Business From Anywhere

By
Irene Makanga
-
2
wealth architects - how to start an online business from anywhere
wealth architects - how to start an online business from anywhere

There is nothing better than owning and maintaining a successful online business. Online businesses give entrepreneurs the freedom and independence to make money from anywhere in the world. Thousands of people start and grow successful online businesses every day.

Thus, here is how to start a small online business that will guarantee your success. 

#1. Fill In A Need

Value is created by finding a need, defining it and filling it with a product or service that generates satisfaction for your customer. To be successful in any business, both online and offline, you’ll need to find that need and fill it. Creating real value and satisfying the needs of your customers, is what will catapult your business to success. 

To find this need within the market you’ll need to try and find a group of people who are searching for a solution to a problem, but not finding many results. The internet has its ways of revealing this kind of information and you can find it in:

+ Online forums – see what questions people ask and what problems they are trying to solve. Product or service opportunities can exist in features, unrealized markets or even in positioning and marketing. 

+ Keyword research – find keywords that a lot of people are searching, but do now have a lot of competition with other sites. The idea here is to pinpoint what you and other people are passionate about. Passion is what will deliver your product or services value and mission to the market successfully. You can use google keyword planner search tool to help you out.

+ Study potential competitors – visit their websites and take notes of what they are doing to fill the demand. Studying the competition will help you identify any unserved niche segments.

Use the things that you learn in your market research to create a product for a market that already exists for it – then do it better than the competition. 

#2. Create A Sales Formula

The most important thing in business is to generate sales. Therefore, before creating the product or service and establishing your presence online, create a sales formula. Take imagined visitors through the selling process from the moment they land on your site or page to make a purchase by using the following proven sales copy formula. 

1. Arouse interest with compelling headlines

2. Describe the problem your product solves

3. Establish the problem your product solves

4. Establish your credibility as a solver of the problem

5. Add testimonials from people who have used your product

6. Talk about the product and how it benefits the user

7. Make an offer

8. Make a strong guarantee

9. Create urgency

10. Ask for the sales

Throughout the process, you will need to focus on how your product/service is able to solve the customer’s problem and improve their lives.

Think like a customer and ask, “What is in it for me?”

#3. Design & Build Your Website

So you’ve got your market, product or service and an amazing sales process, now you’ll need to build an online platform upon which you will present the product or service to the customer. Here, you will need to keep it simple as you will have very little time to get target customers attention. 

Here are some tips to keep in mind as you design and build your platform:

1. Font & colours – choose one or two plain fonts on a white background and choose the best colours to evoke the emotion you want in your customer. 

2. Navigation – make it easy to navigate the site and keep things consistent. 

3. Content – use graphics, audio or video to enhance your message delivery and customer experience. 

4. Information – find ways to collect user information such as including an opt-in offer so you can collect email addresses.

5. Sales Process – Make it easy to buy, no more than a few clicks between potential customers and checkout. Also, include widely used payment options. 

6. Storefront – Your website is like your storefront, so make it customer-friendly and inviting.

You can use Shopify, BigCommerce, WordPress or even Blogger platforms to get your website up and running.

#4. Optimize for Search Engines

Search engine optimization can be achieved either through organic means or advertising. In organic search engine optimization, the aim here is to be on the first page of google for crucial keywords. This process is slow and takes time for traffic to come to you organically.

Time is money and money is time, therefore, the quickest and easiest way to drive traffic to a brand new website is through pay-per-click advertising. Though it will cost you, it will get your website on search pages immediately and also allows you to test different keywords as well as headlines, prices and selling approaches.

#5. Build An Expert Reputation

Establishing an online reputation as an expert will better position you in search engine rankings and bring more traffic.

The secret is to link your site to worthwhile information across the internet. You can do this by creating free expert content like articles, videos or any other content that people will find useful.

Then distribute that content through online article directories or social media sites. Also, encourage your customers to share the valuable content on your site. To become that expert, participate more in industry forums, social media sites – anywhere your target market hangs out.

#6. Utilize Email Marketing Tools

Email marketing is one of the cheapest, most effective and most highly targeted ways of marketing. Thus, making an email list one of the most valuable assets for any online business. Anyone that lands on your website and opt-in your list is a very hot lead.

Before anything else, ensure that you are set-up to receive permission from your customers and subscribers to send them emails. By doing so, sending them emails they asked for won’t be spammy and at the same time enabling your business to forge lifetime relationships with customers. Consequently, use email marketing tools to follow-up on your leads and generate sales for your online business.

Learn More: 12 Valuable Business Lessons Learned The Hard Way

#7. Retaining Customers With Marketing

Marketing is key to customer retention and hence, you should spend a significant amount of time getting to your customers and what they value.

Two simple internet marketing strategies you can use are back-end selling and upselling. They are considered the most important marketing strategies to develop and maintain a loyal customer base. With these marketing strategies, you will be able to keep your customers coming back again and again.

Here are four ways to use back-end selling and upselling:

1. Personalize everything – customers like to feel seen and appreciated. So ensure they are seen and their needs are met.

2. Always offer your products or services that complement your customers’ original purchase.

3. Ensure that you send out loyalty coupons, which they can redeem when they visit your website the next time. Rewards for loyalty will only strengthen your customers’ loyalty to your brand.

4. After every purchase, send and ‘Thank You’ note via email and include offer related products.

Learn More: 5 of the Most Common Fears of Entrepreneurs

Get Your Online Business Out There!

These are just the basics, however, you really can never go wrong adhering to them.

If you don’t want to build a website right now or simply want to sell everywhere. Here is the quickest way to get yourself out there using established e-commerce platforms. These platforms have mastered that art of e-commerce and have their platforms already optimized, have an established relationship with their customers and much more.

Here is a list:

1. Amazon – Worldwide

2. Esty – Worldwide

3. Jumia – Kenya and the Rest of Africa.

4. Kilimall – Kenya

5. Other, Social Media Platforms: Instagram, Facebook, Youtube, LinkedIn, etc.

Overall, there is no right and wrong as to how you should set-up and run your online business. Do what works. The most successful e-commerce websites diversify and have multiple revenue streams their own websites. At the end of the day, it is said that customer’s only preference is convenience.

Happy Building! 

Image credits: Top by Andrea Piacquadio from Pexels

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Is Whole Life Insurance a Good Investment?

By
Irene Makanga
-
0
wealth-architects-is-whole-life-insurance-a-good-investment
wealth-architects-is-whole-life-insurance-a-good-investment

Whole life insurance is permanent life insurance that provides protection for your entire lifetime and remains in place as long as premiums are paid. Therefore, it is NOT an investment like the traditional stocks and bonds are, more like a liquid saving vehicle that gets a more guaranteed return. So should you put your money on it?

Therefore, are two other key benefits and they are: 

1. Death benefit paid to the beneficiary upon the death of the insured

2. Cash value is accumulated over the term of the insurance, can be used as savings or investments which can be used upon retirement or borrowed against if you need the money while you are alive.

In Kenya, most insurance companies offer this cover, including but not limited to UAP Old Mutual, Liberty Life Assurance, and Jubilee Insurance.

Whole Life Insurance Pros & Cons

There are several benefits of a whole life insurance policy include: 

  • Fixed premiums during the time you are covered unless you choose otherwise
  • Premium money goes towards building a cash value that you can borrow against and withdraw before death
  • Provide a modest investment return
  • Tax-deferred growth opportunity on savings
  • Provides life-long cover with no future medical exams that may result in higher premiums.

Some cons include: 

  • Though a modest return is guaranteed, it is mediocre at best.
  • Premiums of a whole life can be quite expensive.
  • Policies are quite complicated and difficult to understand.

Learn More: 5 Ways to Use Your Life Insurance Benefits

Whole Life Insurance As An Investment

Is whole life insurance a good investment? No. Whole life insurance isn’t the best choice as an investment to build wealth with for the following reasons:  

Low Rate of Return

The rate of return on whole life insurance policies is quite low compared to other investments, even when you factor in tax savings at the end of the year. When it comes to whole life insurance, it is best for building and protection, not an investment tool only. 

Hidden Costs

Whole life insurance has hidden fees, such as higher commissions to brokers, and may also include fees for the management of the investment. It is normal for investments to have fees attached i.e. management fees, but make sure that you iron out these details with your financial advisor before taking on life insurance. Remember, this is a life long product and as such, it’s your life you are investing in, protection as well as your family’s security too.

Volatility

Whole life insurance, at least the investment portion of it,  isn’t spared from fluctuating market prices. Being well informed will always protect you. A good financial advisor will be more than happy to iron out any concerns you may have and provide adequate guidance.  Take on whole life insurance, primarily for protection and investment as a secondary benefit. If you can, consider purchasing long-term life insurance with a fixed annual rate of return for both building and protection benefits. For savings only on life insurance, reviewing other strategies that will best benefit you before settling on whole life insurance as the choice. 

Learn More: 3 Paths Of Wealth Accumulation

When Is An Excellent Choice

Here are five instances when a whole life insurance policy is an excellent choice as a way to not only protect but also build wealth: 

  • Young Age. A great option when you are young and do not yet have the means to save money on your own. In that, the policy forces you to save money on a regular basis. 
  • Securing Loans. It can be used as a financial strategy to secure loans or even mortgages in the future if you one day want to purchase a home. 
  • You Are Healthy Now. If you are healthy now, it is an excellent way to secure a policy that will last your entire life. 
  • Shelter Wealth. Life insurance can be a great way to invest money tax-free of the interest and dividends that build off the savings. Thus, it is quite advantageous for estate planning for certain high net-worth individuals looking to minimize estate taxes. 
  • Death Benefits. If you want to leave a large sum of money/legacy death benefit to your family or some else when you die, then whole life is a great way to finance this.

Learn More: How Much Life Insurance Do You Actually Need?

Key Takeaways

Next time you go shopping for a life insurance product, keep these points in mind when making your final decision if whole life insurance is the best option for your needs: 

a. Whole life insurance provides death benefits, tax benefits and cash value but costs more than other term life insurance options. 

b. Is a safer permanent life insurance choice than other types since you know what to expect in terms of interest, premiums and death benefits. 

c. A great financial strategy to maximize benefits when taken on while you are young.

d. Be reasonable and ensure that you can pay the premiums – whole life isn’t beneficial if you skip payments or lose everything when you cancel later. 

e. Purchase life insurance only from companies with a strong rating. Remember it’s a life long investment and thus company stability is essential.

Happy Investing!

Did you enjoy reading this article? If so, I encourage you to sign up for my newsletter and have these articles delivered via email once a month…it’s free!

Image credits: Top by Adrianna Calvo from Pexels

Disclaimer: The information contained in our website, blog, guest blogs, e-mails, videos, programs, services and/or products is for educational and informational purposes only, and is made available to you as self-help tools for your own use.

 

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How to Give An Investment As a Gift

By
Irene Makanga
-
0

Investments as gifts can be the most impactful of all other gifts you can give your family or friends. They benefit everyone – the giver and the recipient, such that the recipient gets the benefit of feeling appreciated and you save yourself from paying tax gains. 

All kinds of investments can be gifted from stocks to real estate. 

Here’s how to give investments as gifts and make an impact in someone else’s life. 

A. Stocks As Gifts

With stock gifts, the gift amount would be the amount in full market value at the time of investment or purchase of the gift. You can transfer shares you already own or purchase shares in the recipient’s name. If well done, a stock gift can be a gift that keeps giving as the appreciation of the gift can be realized every year. However, will there be substantial gains, ensure that you give the recipient a record of its cost basis i.e. capital gains tax and commission fees. Stocks as gifts can be a great way of supporting someone as it’s more socially responsible investment.  

Learn More: How to Determine Which Shares to Buy the on the NSE

B. Bonds As Investment Gifts

Bonds can make great investment gifts. They are low-risk, government-backed bonds that provide the recipient a safe way to save.  Unlike stocks, they come with no fees, expenses and taxes. 

Learn More: 10 Tips for Successful Bond Investing for Beginners

C. Real Estate As Investment Gifts

Real estate properties can make great investment gifts for children. Need I say more? 

Learn More: 7 Common Mistakes to Real Estate Investing to Avoid

D. Gifting Collectible Investments

Collectables are not always as great as classic investments but they can be appreciated in value with time and be worth far more than originally sold because of their condition, rarity or popularity. Collectable investments range from art, fine wine, toys, comics and more. 

Take note that art is subjective and can be tricky to gift as not everyone has the same taste.  However, as with investment gifts, it doesn’t matter what the art looks like, rather how much it could be worth in the future. Art may take a long time to make any return, fine wine on the other hand may turn up a 10-15% return after a few years. 

E. Other Meaningful Financial Gifts

There are many other financial gifts you can give family and friends aside from stocks. You can contribute to their financial accounts such as pension accounts, savings accounts or college funds. This can be more impactful than a simple cash gift as the gift will grow until retirement or ready to use. 

Before Your Gift

The idea of giving an investment as gifts (a gift that has the potential to keep giving)  can be quite attractive to many of us. However, just like all investments, they are still risky. Therefore, before you give, ensure that you have considered the risks. Do all your research and thoroughly educated the recipient of it.

At the end of the day, you want your efforts to yield, not come to nothing. 

Happy Giving!

Image credits: Top by Pixabay via Pexels

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9 Easy Ways to Invest With Little Money

By
Irene Makanga
-
0
wealth architects - 8 Easy Ways to Invest With Little Money
8 Easy Ways to Invest With Little Money

It’s okay to start small. There is a common misconception that you need a lot of money to invest to be effective. Even Though you don’t have much, nowadays it is possible to start building a portfolio and grow your wealth with very little. 

Therefore, try building some wealth using the cookie jar approach. Each week, put away some amount, maybe KES. 500 ($5) into your savings jar, bank account or investment account. This may not seem like much at first, but it can quickly increase to a significant amount if done consistently and invested right. As you get comfortable with saving, increase your savings amount over time and increase the amount you save.

Where Can I Start Investing With Little Money?

Before we get into it, let’s define little money or small amounts of money as something more than KES. 5,000 ($50), but not more than KES. 100,000 ($1,000). Based on this, here are nine (9) ways to invest with little and make a difference for your future, even if you think you don’t have enough money to invest: 

1. Investment/ Lending Clubs

The easiest and most accessible way to invest your money and earn at a tax-free market rate or even better. Typically, the objective of investment and lending clubs to pull resources and assist members/borrow to grow financially. This can be done in two main ways: 

A. Lending money to individuals or businesses, and can be done through small social organizations, online platforms or mobile apps.

B. Investment through informal cooperatives that can be used to pool and invest money in larger worthwhile projects. 

Investment/Lending clubs are great for people who have no access to formal banking services and yet still want to invest in grow financially. 

2. High Yield Savings Account

You really can’t invest without saving first. If you are new to this business of saving and you want to do it well, then start slow by saving loose change. If you manage to save even KES. 500 ($5) a week, then you can turn that to KES. 26,000 ($260) in a year. After about saving a good amount, deposit the money in a high yield savings account. Starting small will help practice and develop the habit of saving.

3. Certificates of Deposit

A Certificate of Deposit (CDs) is a safe and easy way to invest your money in the short term. They offer fixed rate returns and tend to have much lower returns than other types of investments but offer lower risk returns. They are typically offered by banks to customers willing to lock away their savings for a certain period.

Learn More: How to Save Smart With A Certificate of Deposit Ladder

4. Treasury Securities

With very little, you can get access to treasury securities i.e. bonds and bills. They offer low risk, good returns and are available with different maturity lengths and terms. They are a great place to put your money and earn some interest. 

When it comes to treasury securities, it doesn’t really matter which one you add to your investment portfolio. What matters is that you start as soon as possible, no matter what you have. The earlier you start, the more time your investment will have to grow into a sizeable amount. 

Learn More: How to Invest in Treasury Bills in Kenya

5.Unit Trusts & Mutual Funds

Invest in low-initial investment unit trusts and mutual funds. Then aim to consistently increase your investment over time.

Unit trusts are great when you are starting to accumulate some wealth as they will give you access to a portfolio of securities such as equities, bonds, cash, bank deposits and more. On the other hand, mutual funds are also excellent investment vehicles that also allow you to spread your money across stocks and bond markets.  These days, there are several unit trusts and mutual funds that have a low initial investment. 

Learn More: How to Make Money Investing in Unit Trusts

6. Real Estate Crowdfunding & REITs

You now don’t need much to invest in real estate. You can either crowdfund by investing directly into several real estate projects or invest in a REIT, where you are typically putting your money in a corporation that invests your money into real estate. 

In the first option, you can simply team up with other real estate investors, pool your money and buy some real estate together (a Chama is a great place to start). This way, you become a part-owner of a property and any rental income or profits generated from the property would come back to you. While with REITs, you are passively investing and thus you don’t have to directly manage the asset to generate income or profit. 

What’s great is that both of these options offer investors a great balance and diversification from traditional stock and bond markets. Also, it provides great value for both rental income as well as long-term asset appreciation of the underlying. 

Learn More: How to Invest in REITs in Kenya

7. Stock Market

If you want a piece of the action i.e. high prices companies, but can’t afford the cost of share/lot, then consider fractional investing. Fractional investing means investors can buy a fraction of a share or a lot of shares (if shares are bought in lots i.e. lots of 100). If you want to own a piece of large corporations such as Apple stock for instance, rather than purchasing a full share price, you can consider investing the little you have to acquire a piece of the company. This way, you won’t be constrained by a whole share/lot price. 

With this strategy, you can invest what you have and not be left out of investing in the stock market entirely. 

8. Cryptocurrency

I feel that I must mention cryptocurrency. There are a lot of people who support cryptocurrencies and the number keeps growing every day. The number of cryptocurrency exchanges has also grown tremendously, and the market challenges have largely been mitigated, making it easier to trade and earn through cryptocurrency.  A word of caution though – whether or not cryptos are worth investing in all depends on how much research you have done as an investor, and how well you know the market in general. If you do your homework really well, you stand to earn a lot from cryptocurrency.

Learn More: Things You Need to Know Before Investing in Bitcoin

9. Retirement Savings

Begin investing small amounts into your retirement savings in your social security fund, your employer-sponsored retirement plan or any other pension plan you may have. You can contribute as low as 1% of your income or any amount that you won’t miss, into these plans. Ensure that over time as you earn more, increase your savings for retirement.

Saving for retirement is the most important financial goal you can have because it will give you more freedom and control over your life down the road. You don’t want to work so hard all your life and completely loss all freedom and control in your later years.

Summary

There are very many ways to start investing with little money. Nowadays, financial products are more accessible with the onslaught of M-Pesa and other digital products. Take advantage of the online platforms and apps that make it easier for you to invest and start investing today. All you need to do is start, it gets easier with time and your future self will surely thank you for your efforts.

Happy Investing!

Image credits: Top by  Oleg Magni from Pexels

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5 Simple Ways To Boost Your Mental Health for Entrepreneurs

By
Irene Makanga
-
3
wealth architects - mental health & entrepreneurship

Mental health support for entrepreneurs is essential for success and growth. 

The life of an entrepreneur is very stressful and full of uncertainty. This can be compounded by unhealthy comparisons that come with the lifestyle and also social isolation. The struggles that entrepreneurs face are very real and it is said that entrepreneurs are more likely to develop depression, anxiety, bipolar disorder and substance abuse, compared to other people. 

Mental illness, if left untreated can have debilitating consequences and therefore, please take the time to speak to a mental health care professional. For now, here are the five (5) simple ways you can boost your mental health: 

1.Create A Support System

A great support system will give you the support you need, particularly in ensuring that you take care of your mental health needs. Every successful business has had a great support system to get off the ground. We are talking about family, friends, mentors and colleagues. 

All successful business out here thrives on a highly connected, well fostered social network that the entrepreneur can reach out it to resolve issues and grow. So, don’t completely discount the help of others.

2. Strive For Productivity

It isn’t about how long you work – though admirable – but, it’s better to get things done. Done.  Also, avoid burnout from mental exhaustion that may come from working extended 60+ hours every week. Your brain needs to rest and recharge too. 

To increase your productivity, try working on high priority stuff by optimizing your to-do list. This way, you can minimize any distractions by not sweating the small stuff that may be time-consuming and non-consequential at the time. Finally, learn to say no to things that don’t serve you or bring you closer to your goals. 

3. Keep A Gratitude Journal 

Sometimes, we can get so caught up in what is going wrong in our lives that we forget the pleasant surprises that we have experienced. It is very easy to get caught up in the hullabaloo that comes with entrepreneurship – people expect you to make it in a snap of the finger and when you haven’t they will keep asking, “When will you get a job?”. It’s a trap. Sometimes, people are simply managing impressions i.e. putting a facade to impress others.  

So don’t feel crummy about yourself. Keep going, good things are still happening to you too. The easiest way to say focused on these things is to regularly reflect and write a list of the awesome things that are happening. Keeping a gratitude journal will at the very least keep you happier and more optimistic about life in general. 

4. Develop A Self-Care Routine

In the thick of things, don’t forget to carve out some time for yourself. Every day, strive to do at least one thing that makes you happy (not work-related). It will help you better cope with the stress and anxiety that comes with the entrepreneurial journey. 

Alongside that, ensure you invest in a healthy work-life balance to keep mental health problems at bay. Take some time to spend with family and friends, and doing interesting things like swimming, yoga or forest bathing. Your mind and body need fuel to stay healthy, so also exercise regularly and eat healthily. 

5. Strike A Superhero Pose

I first saw this in an episode of Grey’s Anatomy, when Amelia struck a superhero pose to regain her confidence after a mini-meltdown. She said that research shows that striking a super-hero pose improves one’s confidence. I was super sceptical, so I did some research on it and sure enough, there was a body of text to support her claim. 

Surprisingly, according to researchers assuming the super-hero, high power pose increased testosterone (power hormones) and decreased cortisol (a stress hormone), triggering changed behaviour by elevating confidence. 

So next time your confidence levels are low, relax, open up and assume the superhero pose. Hopefully, then, you can at the very least reduce the amount of anxiety you are experiencing. 

Final Words

Being an entrepreneur isn’t easy and can drive you to the brink if you let it. The hack is to develop a routine that boosts your mental health in order to increase the chances of success in your business. Therefore, take care of your mental health. It is only then that it becomes easier to absorb whatever the entrepreneurial journey has the throw at you – risk, stress and uncertainty. 

Image credits: Top by Madison Inouye from Pexels

See also:

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6 Ways Your Mental Health Is the Key to Your Success in Business

By
Irene Makanga
-
3
wealth architects - mental health & entrepreneurship

About one-half of all entrepreneurs suffer from at least one form of mental health problem during their lifetime, according to a study conducted by Michael Freeman. 

It is really difficult to stay positive and highly motivated all the time. Particularly as an entrepreneur. According to a study by Michael Freeman, it is clear that the traits that drive entrepreneurs to succeed can also drive them to depths of darkness pervaded by a black fog. Entrepreneurs experience almost every emotion with intensity. From the adrenaline rush of launching to the heart-wrenching grief of failure, with panic churns. The terror of feeling like an imposter.  Jitters of the highs and the calm energy of getting things done at 2 am in-between. A great percentage of the time they look to positive maxims and highly motivational aphorisms to keep going. 

As an entrepreneur, you are the key asset in your business and the driving force of your team. Therefore, you need to take care of your mental health in order to meet the challenges of leading a business to success else, doomed to stagnancy. 

Today, there is a lot of research and case studies that point to the negative correlation between entrepreneurship and mental health. To succeed in a society that glamorizes entrepreneurship, here are six (6) ways your mental health is key to success: 

#1 Entrepreneurial Life is Stressful

The life of an entrepreneur can be very stressful and we are easily stuck in a never-ending cycle of putting out fires forgetting to kick back and connect with the masses. We tend to think about work even when we are supposed to completely unplug. Also, we are notoriously sleep-deprived, undernourished, over-caffeinated and finally constrained – with very little emphasis on self-care or any coping strategies for fun. Many of us are highly predisposed to addiction. Very vulnerable to developing unhealthy relationships to success or other tendencies to numb the stress. 

Therefore, regardless of the fact that you are running a massive empire or you are a solo entrepreneur running a small business, spare some time to exercise to improve mental fitness. Give your body the best chance to support you mentally and physically through challenges and stressful situations you may encounter. 

#2 There is Pressure of Success

There is a saying that success comes with a price and entrepreneurs are acutely aware of this. All the stress and pressure to succeed can lead anyone to their breaking point. It can be quite difficult to balance business and wellbeing as higher your rise because there is greater pressure to perform and self-doubt keeps knocking. 

The pressure to succeed a lot can bread isolation and self-neglect. For a business to take off, it requires a lot of time and mental capacity to manage. This tends to lead many entrepreneurs to push aside things such as social interactions that may provide an anchor or support for their mental health. 

Therefore, don’t let the things that bring richness and joy to life be consumed by business. Invest some effort to self-care, family or simply moments of stillness to recharge and rejuvenate yourself. If the pressure is left unchecked, it can topple the balance between drive for success and mental health. Ultimately leading to burnout and eventually, full-blown mental illness. 

#3 Social Isolation

As mentioned before, it is quite difficult for us to balance our business and wellbeing, thus we tend to pour ourselves into our work leaving to isolation. This is particularly so during the early stages. No one understands us and we more often than not, feel unsupported for taking a non-traditional path. This may lead to depression since most interactions are often networking or sales focused, lacking the vulnerability necessary for authentic connection. 

All we need most the time is to hear that we are “doing a good job” not “get a ‘real job’” to provide some level of reassurance not further the loneliness, frustration and shame. 

#4 Feeling Like An Imposter

A lot of entrepreneurs feel like imposters which fester feelings of shame. In order to cope, we develop impression management tactics in order to be considered competent by customers, investors – basically everyone with an interest. We need to be perceived as infallible. Constantly putting up a strong front further perpetuates the shame and disconnection experienced, discouraging us from seeking help. 

Impression management hinders the development of a sense of self, which leads to insecurity and identity confusion. This will kill your business faster than you think. Don’t suffer silently, hiding away and opting to put forth optics to cover our weaknesses. You are not alone! Internalise that. We all have weaknesses and sometimes, we all feel like we don’t belong sometimes. Also, we all aren’t always ready or know everything. Most importantly, no one sees you as an imposter. 

#5 Facing Uncertainty

To manage our anxiety, we entrepreneurs create to the illusion of certainty to hide the of feeling powerless. Since, we are susceptible to higher levels of uncertainty, anxiety and responsibility, we tend to constantly optimistic even when things don’t look good. 

Therefore, to face uncertainty, our strength and resilience are what gets tested the most ergo invest the effort to get familiar with yourself. You are the greatest asset, the driving force – you will discover that all your characteristics function as both strengths and weaknesses. To soldier on, get the courage to identify and admit your vulnerabilities. Remember, that it is in the deepest darkness that we open our eyes to see the light at the end of the tunnel. 

#6 The Marriage of Self-Worth & Company Success

Many of us tend to attach our self-worth to our businesses. This is particularly so because we tend to lose ourselves to building our businesses and thus become detached from ourselves, our loved ones and friends. This attachment is a manifestation of perfection that leads to anxiety driven by the constantly changing company forecast. 

Consequently, try to divorce yourself from your business by not to be dependent on its ever-changing forecast. You can do so by turning your focus outward to family, friends or being a mentor of someone else. This will reap incredible benefits for your own mental health. In providing the satiating nourishment that can catalyze improved mental health to help your reach greater business success. 

Summary

The consequences of poor mental health can be catastrophic. The emotional darkness that lingers can pervade not just your professional life, but also several other areas of your life. So, in becoming aware of the ways in which mental health can negatively affect your performance as the asset of your business, you can steer your health in a progressive direction. This way you can achieve success beyond what you thought possible with a far greater sense of purpose and satisfaction.

Image credits: Top by Madison Inouye from Pexels

See also:

 

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10 Reasons Why You Need To Have Multiple Financial Accounts

By
Irene Makanga
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wealth archiects - 10 reasons why you should have mutiple financial accounts

You should have multiple financial accounts for a bunch of reasons. We cover just five of those reasons today.

Don’t depend on your success one single financial institution or plan of action. For multiple reasons, you’d probably want to have more than one of the same type of financial account spread across multiple financial institutions for a bunch of reasons.

Here are ten (10) reasons why :

1. Service Outage/Downtime In Times of Need

Banks often perform system upgrades, and sometimes, not always there are total service outages. Having your financial accounts in on financial institution may leave you unable to access your account, and sometimes even have issues when payments do not reflect as posted.

So, as long as you have enough funds spread out in several accounts and financial institutions to cover you in the case of an emergency, you would easily be able to handle stressful situations in times of service outages and downtime. 

You don’t want to miss a payment or have all your funds stashed up on a single bank, you never know when you might be in a money crisis and your bank is unable to come through. 

Take Advantage of the Best Products In Each Category

If you want access to the best in class financial products in every banking category, you are probably going to have to have multiple accounts to take advantage of them. Not all banks are created equal, each bank has its own strengths and weaknesses, thus rarely will a single have the best transactional accounts, savings account, credit card, loan rates and mortgage products. Instead, you will find that one bank has amazing credit card products and another, has the best car loans. 

3. Reaching Your Deposit Insurance Limits

This is a big one, for me at least. Some years ago, I witnessed a friend of mine lost all the money in her bank account when the bank went under. This incident really opened up my eyes to the reasons why it is important to spread your money across multiple accounts in banks and credit unions. If you have reached your deposit insurance limit, you should consider spreading out your money to make sure that it is all insured should your bank or credit union go under. 

So what exactly does all this mean? Basically, if your bank or credit union has insurance on deposits, you can get access to your money up to the insured limit, should the bank fail tomorrow. Should you have more funds over and above the sum insured, then spread your money all over so that all your deposits are covered. This way, you can continue living your day to day life while the bank’s matter get sorted. 

4. You run a business

In order to keep your finances separate – personal and business, you’ll need another account to ensure the smooth running of things. You can do this with the same financial institution as your primary account, however, having your business account in a separate bank can keep you from drawing from the wrong account for the wrong reasons.

Here is why: 

(a). Mixing your business and personal transactions can lead to legal troubles as it opens you up for personal liability when you would others be protected. 

(b). Separating your finances makes life much easier if you run all transactions in the designated account. 

5. For Easy Money Management

A common misconception is that having fewer accounts makes it easier to manage money. However, multiple accounts can help keep you accountable to your budget and allow you to save for specific goals. A single account can make it quite difficult to allocate money to your financial goals and also manage expenses since everything stashed in one account. 

In the spirit of keeping things in order and separate, you can transfer money into separate accounts designated for a specific purpose or goal such as a home down payment, new car fund, vacation fund, education fund and more. This way, you are less likely to use up money out of the wrong account. Separate accounts will keep you disciplined and focused on the goals you really care about.

6. Prevent the Bank From Making Drawings

When you make defaults on certain payments i.e. loans, credit cards etc, banks and credit card companies can perform due process and get your account seized to pay off defaults. Particularly, banks can simply make drawings from your account without even going through the legal channels. 

Therefore, keeping things separate is for your security and best interest. This way, you can avoid the bank or credit card company from gaining access to all of your money. 

Summary

If you currently have all of your accounts at the same bank, you should seriously consider opening at least one other account to secure your money. First, decide what you want and then open the account to cater for that as soon as you can. 

Image credits: Top by Serpstat from Pexels

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4 Ways Financial Planning Differs for Entrepreneurs

By
Irene Makanga
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A lot of people fail to plan. This is because they think they don’t have enough – enough variable income or are currently investing in a business, waiting for it to produce a sizeable income. As such, financial planning during the early stages of entrepreneurial venturing tends to be more invested towards running the business and increasing business cash flow, rather than personal financial planning. However, this shouldn’t stop you from having some personal financial goals as well.

So, why is it so important to think beyond your primary entrepreneurial venture? 

Entrepreneurs have an unstable income

Profitability can sometimes be erratic – increasing and decreasing at irregular intervals – making it hard to predict and manage personal finance. As such, you’ll need to work really hard to ensure that your income is as predictable and as smooth as possible. This way you can be able to pay yourself at least a competitive market rate for your role.  

Financial planning provides lifestyle stability

Planning and managing your personal finance can help provide you with greater lifestyle stability. Thereby reducing the stress around money i.e. debt, unexpected expenses and more. A stable life can be a source of great confidence and productivity for entrepreneurs. 

Helps you prepare for the worst

In business, as in life, one needs to be realistic. The failure rate of new business is quite high even though you have great ideas and a good team to execute, you can still end up without a source of income. So combine this stress and the fact that you might have to take on debt and risk to start the business. You could be left in a very compromising position. Preparing your personal finances to cater for the worse case scenarios can guard you against such eventuality. 

Take advantage of amazing payoffs

Financial planning for entrepreneurs, though difficult, can yield tremendous payoffs, if a financial plan is in place to actualize. For entrepreneurs, it is possible to retire years before what is considered normal retirement, start another business or even work on things that you are passionate about. 

Financial Planning For Entrepreneurs

Since entrepreneurs are compensated different i.e. via wages or profit distribution, this impacts their financial risk, tax, pension and more. Here are five (5) ways in which financial planning for entrepreneurs is different: 

I. Risk Profile

Risk is inherent in entrepreneurship, particularly at the starting phase as personal cash flow tends to be negative. In many instances as you might be funding your business personally or through debt which you have guaranteed to get things going. However, as the business stabilizes with a steady income, being an entrepreneur becomes less risky compared to being an employee. 

For entrepreneurs, this means that they need a smaller emergency fund than a typical employee with similar compensation. 

II. Taxation

When it comes to tax planning, entrepreneurs have a number of options. As the owner of the business, you will need to make a few decisions that will have an impact on your tax bill. Things to consider are: 

  • They type of business which determines how tax is paid 
  • Whether or not you’ll have an employee-sponsored retirement plan that determines how much income will be tax-sheltered. 
  • Type of self-compensation you will have i.e. salary or profit distribution
  • The treatment of what you can write off as a business expense.

III. Choice of Benefits

Unlike a typical employee, you have the choice of benefits you want to have in terms of health care, retirement plans, disability insurance, life insurance – the full array. All these things will seriously impact your personal financial plan since it’s either you get them through the company or you purchase them on your own. 

IV. Exit Strategy

For many entrepreneurs, a primary motivation to grow their ventures is the payoff they expect to net from the business upon their exit. This payoff is the key factor in the financial plan and needs to seriously needs to be considered when drafting a financial plan. A payoff on the sale of the business can really change your outlook and present you with new opportunities you previously never thought possible. 

Achieving It All

I am aware of my personal experience that it takes time for things to materialize and the business to move in a clear direction. Therefore, it becomes very difficult to construct a financial plan or even make personal financial goals. However, still, make those plans, don’t beat yourself up for not reaching them simply adjust and be flexible. Financial planning is extremely important for entrepreneurs as it helps clarify and translate one’s business success into attainment of personal financial goals. 

Image credits: Top by Polina Zimmerman from Pexels

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5 Practical Personal Finance Strategies For Every Entrepreneur

By
Irene Makanga
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1
5 practical personal finance strategies for every entrepreneur - wealth architects

Every entrepreneur should prepare their personal finances because you may never know what can happen to your business. 

Entrepreneurship is an extremely demanding life choice that requires a high commitment of time and resources to succeed. As such, there is not much time left to manage personal finances on top of staying healthy, sleeping and spending time with loved ones. You probably became an entrepreneur in order to do what you love while building a stable wealthy financial future for yourself. But, if you spend all your time focusing on your company’s finances and growth that you neglect your personal finance, you could severely compromise your future.  Perhaps your business may suffer too.

So, here are five (5) practical personal finance strategies that every entrepreneur should use:

I. Set Goals

I am a firm believer in goal setting. Therefore, won’t stop championing it as a great strategy to focus and work out your personal finance. So, ensure that you set specific and achievable goals. They will serve as a powerful motivator to keep you on track and give you a framework upon which you can measure the success of your efforts. Being consistent and following through, will help you achieve those goals. 

Solid Strategy: 

A. Budgeting – This is the first step to any solid personal finance plan that has a shot of success. Budgeting with a possibly invariable income can be quite challenging, but not impossible. There are several approaches you can use. The first being the most widely used, is you take your monthly income, subtract the necessary expenses. Then distribute the rest to personal savings, investments and perhaps discretionary spending. The second, a better path for entrepreneurs, is to work on minimizing personal expenses as much as possible. Once you know exactly how much you need, set it as a benchmark to work with. Then simply make the amount of money to reach that cost and have more leftover to save or invest. 

II. Think Long-Term

Adopt long-term personal finance plans intended to optimize for the long-term. Though most of the personal-finance strategies that we use are focused on building daily, weekly and monthly habits, as entrepreneurs, those actions need to optimized for the long-term. The further ahead you can plan, the better off you will be in a few decades. Entrepreneurship is a long-term game, so cast long-term. 

Solid Strategy: 

A. Investments – To have a solid long-term plan in place, you’ll need to invest whatever you set aside. This will go a long way to help catapult you into a successful financial future.  So, take the time to establish a solid plan.  Particularly a retirement plan, since you cannot guarantee the perpetuity of your business. Invest your money in a good pension fund, also consider placing your money assets and securities into a brokerage platform. Whatever you do, diversify your investment portfolio in stocks, bonds, mutual funds, REITs, and much more. 

III. Reduce Risk

Starting a business and depending on it entirely for your livelihood, can be quite risky. Therefore, the last thing you want is this risk pouring into other areas of your life. Though some forms of risk are unavoidable, it is your job to reduce the risk you face as much as possible. This can be achieved by keeping your financial life in balance. 

Solid Strategies: 

A. Emergency Fund – What if your business goes through a tough period – can’t turn a profit, or you need to cut back a little, or even goes under completely? These are some of the worst-case scenarios for most entrepreneurs. As such, we need to be very realistic about the looming threats that we need to prepare for. Setting up an emergency fund that can cover about 6 months to a year of your expenses will greatly help you survive the tough times. So, if you don’t have an emergency fund, establish one.  Set aside a bit of money every month until you have accumulated a significant amount to cover at least six months of your expenses.

B. Insurance – The best way to reduce financial risk in your life, is by utilizing the right personal insurance products such as home, asset, personal liability, health and life insurance. Make sure that you get the best deals possible. Do whatever you can to lower your risk profile as much as possible. This is assuming that you have already insured your company for liability insurance and similar policies. 

C. Diversify Your Income – Multiple income streams – not just your business – reduces the risk associated with having a single income stream. That is, protection if one source becomes unavailable or declines in value. Several income streams increase the total amount of money you make. Thereby increasing financial flexibility and putting you on the fast track to financial independence. The most common alternative income streams are investments that pay dividends/interest income, rental income, weekend gigs etc. Remember, the more diversification in channels the safer your money will be. 

IV. Strive For Stability

Entrepreneurs perform better when they are stable: they are more confident, make better decisions and are more productive overall. Stability will help you compensate for the volatility of the lifestyle entrepreneurship creates, allowing you to perform at your best. 

Solid Strategy:

A. Debt Reduction – debt is quite problematic for entrepreneurs, particularly when taken to start a business. It’s like having another boss that is super demanding and stressful. Striving for stability means getting your debt under control by making it work for you, not the other way around. Thus, only take on good debt i.e. debt to invest in an investment that grows in value and generates long-term income. As for the bad debt you may already have, aim to eliminate it by making an excess of the minimum payment each month to systematically reduce it. 

V. Continuously Learn

Entrepreneurship is about continuous growth and learning, this is the same for personal finance. Therefore, commit to continuously learn new things and new ways to employ your money to work for you. Now and then, adjust your goals as you make more progress, gain new information and even change strategies when you become more confident in your abilities. As an entrepreneur, never stay comfortable for too long.  Strive to improve and make even more progress.

The Bottomline

Once you have set-up these personal finance strategies, make time to regularly hold yourself accountable to the higher-level plans you have set. This way, you’ll remain on track for the long-term financial goals. They will provide you with better financial protection, and ultimately success as an entrepreneur. Remember, financial stability means a smarter and more capable entrepreneur. 

Image credits: To by PICHA Stock from Pexels.

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12 Valuable Business Lessons Learned The Hard Way

By
Irene Makanga
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1

Business lessons learned the first time in business are never wasted the second time.

2020 has been an incredibly challenging year for many of us. But, the biggest challenge (aside from battling to stay safe) is learning how to change rapidly in mindset, attitude, direction and behaviour. It reminds of an old saying that if you sit on a rock long enough, it gets warm. 

The ebbs and flows of this year, have been merciless but this is the time to believe in yourself now more than ever. The business lessons are learning now, will come in handy post-pandemic.  The entire year I felt like I was lagging behind in everything. I had some wins though and found better solutions to things. I hope I can help you avoid some of the pain I endured over the last couple of years, particularly this year. 

Here are the 12 business lessons that I learned that hard way:

Lesson #1 Don’t Take Advice from Habitual Advice-Givers

Be very careful when accepting advice from people who freely dish out advice. They tend to be lacking in many ways. More often than not, they have more interest in solving other people’s problems than they do their own. It’s an ego-gratifying habit that you don’t want to get sucked into, and dragged into the wrong direction. 

In business, it is always advisable to have a few trusted knowledgeable advisors that you can go to for advice. These people will have a better understanding of your situation and also will have your best interests at heart. Also, give yourself time to think things through before taking any action. 

Lesson #2 Be Willing to Learn

Look at things bit by bit, you shouldn’t go all in. Learn for yourself that way it will be known to you. Having the willingness to learn is critical to your success as an entrepreneur as you’ll need to constantly innovate in order to constantly stay ahead of the competition. Particularly now! Simply having that desire and willingness, shouldn’t be underestimated. 

Additionally, take the time to stop and reflect on the past. Your past performance actually does reflect your future performance. This is always something to remember when you are looking at your personal business endeavours and also your financial endeavours. If it was well, it shall be well again as long as you learn from your mistakes. Mistakes that are learned from are absolutely necessary to build character. Building a business is an experience like no other. 

Lesson #3 If You Can’t Afford it, Don’t Gamble It

A common-sense rule of gambling – “Don’t play with money you can’t afford to lose”. I know that risk is inherent in every endeavour but gambling isn’t. 

Note the difference: risk is a calculated move, while as gambling is forfeiting control to risk i.e. guessing. Guessing is foolish and reckless, but calculated risk tends to lead to the biggest rewards.  So when you choose to gamble or guess, ensure that you can afford it. No matter how lucky or skilful you think you are, playing with money you cannot afford to lose will seriously set you back on the chance you lose it all. 

In the long run, the uncomfortable experienced left after such an experience will haunt you and leave you unable to make the right moves or judgement because you already feel like a loser in the game. This goes beyond the bounds of self-control and decency. Therefore, strive to be a more intelligent player – and, you should strive to be a consistent winner in everything – you should always play with the right foot forward. 

Lesson #4 Prioritize Earning

Focus on business activities that will generate earnings – cash flow is king in any business, especially now. I learnt this the hard way when I started my second business in which I had a lot of my capital tied up in inventory that I needed to convert into cash real quick to make other essential payments.

To stay afloat as a small business – keep your doors open – you’ll need to focus on getting paid first. Don’t give too much attention to things that don’t contribute directly to your bottom line. So, once your customer buying process is in place, focus on getting paid – convert product/service into cash over and over, while increasing efficiency and quality.

Lesson #5 Don’t Do It All By Yourself

This was the greatest lesson and the greatest roadblock for me. It is very difficult to let someone else do what you know you can do or even figure out on your own. I learned this lesson the hard way last year while trying to do everything. Business can get quite lonely, so strive to make a positive contribution to your own happiness and mental health by getting the support system you need to stay healthy and happy.

Lesson #6 Learn to Say No

My inability to say ‘No’ to people was costing me time and money. This made me an easy target for “friends” to use me. I spent billable time servicing friends and giving them special treatment in discounts and freebies. When I started out, I was so happy about every potential sale that came my way that I never stopped to think about how it would all play out to my bottom line. Please don’t get me wrong, yes friends should get “special treatment” for merely being a friend and also one of your first customers, but that shouldn’t be in the form of discounts and freebies. Having them pay full price, provides you validation for creating value and they are more likely to provide honest feedback to your business. In turn, help you grow your business. 

Lesson #7 Focus on Customer Retention

It amazes me to see small businesses mistreating customers they have worked so hard to get. When someone has your attention, ensure that it stays that way because acquiring a new customer is much more expensive than retaining an existing one. Customer retention is important for consistent growth and financial planning of your business. If you can count on a committed customer returning, you can easily make business decisions pertaining to budgeting and sales more easily. So, love your customers and take good care of them, tomorrow you may need them. This brings us to lesson #8. 

Lesson #8 Let Your Customers Pick Your Next Customer

The best customers are obtained through referrals – a customer acquisition strategy that also happens to promote retention.  With referrals, there is no need for spending money to attract new customers. Research says that 83% of consumers trust a product or service recommendation from family and friends.  So, let your existing customers help you bring in new business by making that initial recommendation. Ensure that you take the time to get to know your customer and then move on to provide a positive experience. They’ll be more than happy to tell their family and friends about it.

Lesson #9 Not Every Shilling is a Good Shilling

Essentially, not every prospect has the same shilling. There are times in business where you might be tempted to do business with certain people and then find yourself spending more to earn the shilling you are trying to earn. 

From a consulting perspective, sometimes there are clients that come to you asking for things that are outside of your scope of service. Since you know how to go about it, you are like…what the heck I will do it even though you are not super efficient at it as you are in the areas to do day in day out. Earning that shilling is going to be very slow and painful with a longer, larger ramp up time. Thus, you won’t get the enjoyment, their satisfaction at the end of the day and potential profitability out of it.  

Ultimately, in business do not make the mistake of taking on the wrong customer simply because they put money on the table. Know your customer, and pursue them with vengeance, knowing that each one you catch will make your business stronger and better in the long run. 

Lesson #10 Be Confident Enough Accept Your Faults

I learned that accepting the fact that you aren’t perfect will save you a lot of time and move you forward more quickly. Everyone has faults, so avoid the ego trip of trying to cover-up your mistakes. Instead, accept them and face the reality of your own mistakes. There is no greater sign of confidence, growth and self-acceptance – in the good, the bad and the ugly. 

Lesson #11 Don’t Be Afraid To Start Small

I think this is the most important lesson of all the business lessons. Most people are totally afraid to start small because they think they need much more to get somewhere. Personally, I don’t believe in starting with money, I believe in the purpose and the money will follow later on.  After all, you must start somewhere and at the end of the day, you don’t need a lot to do it. Just start. 

Lesson #12 Keep Going

Keep your head down and keep going. It is easy to quit but don’t. Tackle every problem as it comes along and learn those business lessons. Don’t overthink it or overanalyze about why it will not work out. Things will get better, just keep going.

Over to You

There you have it, guys. Twelve (12) business lessons I learned the hard way over the last couple of years as a solo entrepreneur. 

Anything here you can use? Add? Share your business lessons with us in the comment section below.

Image Credits: Top by Prateek Katyal from Pexels.

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