You may have been wishing for a few free dollars to handle some of your business projects, to get something on your bucket list, or to pay a deserving fee. Money remains the topmost limitation against the execution of the plans of many people and entrepreneurs. But even when it comes, most people still don't turn it into their plans.
Talking about free offers, concrete evidence-based studies have proven that people are naturally drawn to free things. In an experiment from Chris Anderson’s book, Free: The Future of a Radical Price, a chocolate kiss(a conical chocolate sweet) and a chocolate truffle(a more rounded chocolate ball) were offered. The kiss was offered for a penny(1 cent) and the truffle for 18 cents. Chris Anderson noted in the book that the majority of consumers choose the truffle over the kiss. However, when the price of the truffle was reduced to a penny and the kiss became free, the opposite happened. Customers now preferred chocolate kiss.
The reason why customers initially preferred the truffle even when the kiss was only a cent was that the chocolate kiss was widely available while truffles are not. But when the price of a kiss was reduced to free, the kiss gained some formerly hidden value.
Back to where we started off. Many people have projects pending because they do not have enough capital to kick-start them. They would pin their inability to execute the projects on the lack of sufficient funds but you know what, that is not the major problem here.
Financial accountability skills are grossly lacking in many entrepreneurs today. Very many people are caught in the monthly loop of abundance followed by financial draught. On payday, money is more at their disposal and they uncontrollably go on to buy all the items they have been wishing for since the middle of the month, at which point they have already run out of cash. To loop through the cycle once again, the money runs red around the second half of the month, at which point, spending becomes regulated until money flow is restored on the next payday.
Apart from the 1000 dollar offer you are probably expecting, there are other money sources you must learn to manage and control. Most job interviews and interrogation sessions have begun including financial questions into their line of questioning. They would ask questions like, "if given a free 1000 dollars offer, how would you spend it?". Answers to such interview questions are usually very fantastic as the candidate would do anything to provide answers that would please the interviewer. However, in reality, we are continually being faced with this same exact question. But in these real scenarios, what has been your response so far?
Yes, you would say that it is none of my business knowing how you would spend your 1000 dollars. But I am afraid, it will go down the drain just like the others that may have come before it unless you learn some money management skills. Many great entrepreneurs have had to make great fortunes with minimal funds because they were able to account for the little money at hand, whereas many others have wasted bigger amounts without any returns. The difference yet lies in accountability.
Account For Money At Hand
There are chances that you have some money already at the moment and you must learn to efficiently manage it. Of course, you need to first cater to your basic expenditures like feeding, clothing, and shelter, but afterward, what happens?
In many countries of the world, we have people who barely have anything left after their basic expenditures and we have people who would do better with a little more careful accountability. Most shockingly, we have people who could afford to do very big things so comfortably after their basic needs have been handled but they did not succeed because they are not accountable.
Account For Expectation Money
Expectation money is a good source of hope when you do not have enough in your hand at the moment. The feeling that you have a sure expectation can strengthen you to hold on till then. But then, if you must account properly for the money you are expecting, you must do so without the bias of the things you currently lack and focus on what you truly need. True needs are beyond mere wants.
Account For Unexpectable Monies
The majority of experiences I have had or witnessed proved that people treat unexpected money almost the same way they treat free offers. They tend to squander it on needless things until it is totally exhausted.
However, if you are a project-driven entrepreneur, the best way you can effectively account for this source of money is to be up to date with your business and investment plans. When your business plans are up to date, you are more ready to fill in any vacuum with money that comes your way. If you fail to plan ahead, you may just see yourself under-utilizing your resources.