You've trained hard, you've passed or are close to passing your coaching qualification and you can't wait to help lots of people who can really benefit from your coaching skills. Fantastic! It might not be the sexiest subject to bring up at this exciting moment but in order to help lots of current and potential coaching clients, you need to stay in business and understand the very basics of finance to do this. Andi Lonnen shares her expert advice.
Finance is the language of business after all. So here are three of my top tips to ensure you are FABULOUS at finance in your coaching business:
1. Watch your cash flow
Simply put, you need to ensure you have more money coming into, than going out of your business.
No cash means no business.
It is easy to produce a very simple cash forecast showing what cash you expect to come in and when, what cash you expect to go out and when and therefore how much cash you will have left.
Start with what you know, which is usually cash going out, such as monthly direct debits and standing orders, a new laptop that you wish to buy, some office stationery, travel to your clients and networking groups, etc.
Then estimate what cash you will have coming in from your clients.
This wonderfully simple tool gives you the power to see into your financial future.
If you don’t like what you see, you can take action to improve your cash position – before you end up in a mess.
2. Getting paid
Asking for payment can all feel rather awkward when you first set up in business.
I know this from experience.
But, as Lord Alan Sugar himself says, “getting paid is THE most important part of your business.”
So 2 top tips for you:
a) Invoice your clients in advance of the coaching sessions. This is professional, perfectly normal in this industry and saves you a lot of time (and therefore money) and headaches chasing for payment after the event which can also damage relations with your client.
b) Bev James, Managing Director of The Coaching Academy, is a big fan of packaging your services and encouraging payment for a package up-front.
3. Get a good accountant
Good accountants are worth their weight in gold and will save you far more than you will ever spend on them.
Speak to them right from the start – they will help you determine the best structure for your business, i.e. sole trader vs limited company, both of which have different tax implications.
Of course accountants are also completely up to date with all the latest tax and VAT regulations. One golden rule is never, ever, ever contest the tax-man (or woman). EVER!
Your accountant can deal with them for you and keep your mind at rest.
Lots of luck implementing these steps to become FABULOUS at finance in your coaching business and here’s to your huge success!
About the Author:
Andi Lonnen delivers enjoyable, highly practical and business focused financial training and workshops around the UK and beyond and is a speaker at conferences and events inspiring delegates to be FABULOUS at finance! You can connect with Andi through her twitter @andilonnen.
The Coaching Academy was established in 1999, and is now the world's largest coaching school.
In that time we have trained over 14,000 people to become life coaches.
We are accredited by the International Coach Federation and the Association for Coaching, and we're rated 4.8 out of 5 on Trustpilot.
