Similar to The Elite Nurse Practitioner “Clinical Pearl Wednesdays”, I will now begin releasing a tip every Friday to help the nurse practitioner with their personal and business-related finances. These tips will hopefully help many of you build a more financially secure, redundant, and independent life. So, lets get to the very first Finance Tip Friday!
Every nurse practitioner should get a better grasp on their finances, and this all starts with controlling expenses. The amount of expenses in your personal life and in your business will be the number one determining factor on how healthy you are financially. You should not be spending more or equal to what you earn… I could literally live off $2,000 a month because I have very low personal expenses, but I used to spend $10,000 a month on useless crap before I realized I was doing nothing but enslaving myself further and delaying financial independence. So, if you want to escape the rat race, CONTROL THOSE EXPENSES!
The first step in decreasing your personal/business expenses is to identify a potential purchase as a “want” or as a “need.”
Before you purchase anything in your day-to-day life, ask yourself “Do I just WANT this, or do I NEED this?” If you are trying to cut back on your expenses, then anything that is a “want” is typically not necessary in your life, and a waste of money. Additionally, the desire for this “want” usually will dissipate in a matter of a few hours or days and you will be glad you didn’t purchase that “want.”
In your business, you need to ask yourself the same question, “Does my business actually NEED this, or do I just WANT it?” Profits = Revenue – EXPENSES. If you want more profits, you need to decrease those expenses! If your practice does not 100% need the service or product you are buying OR it will not increase your revenue, then it is unnecessary and just a “want”, therefore you need to skip it. Expenses can really pile up in a business and before you know it, you will be in the red!
Integrate the concept of identifying potential purchases as a “want” or as a “need” into your mind and watch the expenses in your life decrease significantly, which will lead to more savings, and ultimately more freedom!