All right, all right. So another year has passed you by and your thinking" this year, I'm gonna do it!!" Well, I ask you. What exactly is it that your gonna do?? If you are one of the few who do actually have an answer... Just how the heck do you plan to do it?!?! So if you are a hairdresser, nail tech, massage therapist or aesthetician and your hoping to look better in the pocket book area at the end or 2010 than you are right now, read on..
Traveling the country and dealing with hairdressers one of the things that has proven itself to be a harsh reality is that most people in our business could so easily achieve their financial goals. However most do not. This is true for two simple reasons. Number one reason; They do not know how much they want to make in the first place. Number two reason; they have no plan at all on how to achieve their goal.
First of all there are only 4 things that we can actually do with money. We can Make Money, Save Money, Grow Money and of course SPEND MONEY. Most people do not read a blog about how to spend money so let's focus on the first two for now.. first of all How much $ do you want to make this year?? There are just two things that you need to consider when answering this question. 1. how much dose it cost you to live for a year. And 2. how much would you like to have left over after that (Which is the saving part).
#1. How much dose it cost me to live.. Make a list of all of your monthly expenses.
A. Rent or mortgage
B. Car maintenance, and insurance
D. Savings long term and short term
E. Electric and Utilities
F. Child care ( and all that comes with that)
G. Clothing
H. Groceries
I. Entertainment
J. Telephone and Internet
K Etc. etc. etc.
Now add those all together and come up with the total.
Let's say that all of your monthly expenses added up to $ 3,750
Next we are going to take that monthly expenses total and multiply it by 12. (because there are 12 months in a year)
SO, 3,750 * 12= 45,000
There we have it! An accurate number of how much you would need to make this year if your current monthly expenses are $3,750.
Now If you are a salon professional who works on a commission basis of let's say 50% (to make the numbers easy your commission may be higher or lower in this case you would adjust the numbers to fit your personal situation) we would take your monthly Desired income and multiply it by 2 ( because at 50% you take home 1/2 of what you take in).
3,750 * 2 = 7,500 this gives our before taxes bring in income it would take for us to achieve our desired income.
An easy way to for us to figure taxes is to "guesstimate" that taxes are 30% if our "bring home income". So again take your desired monthly income ( which for the example is 3,750) and multiply X .3 and we will come up with a good estimation of taxes.
3,750 x .3 = $1125 So $1125 would be your estimated tax with hold. Let's now add this with your desired monthly "take in" income and see what we come up with. This will give us a grand total of what we would actually need to produce behind the chair to achieve our financial goal.
7,500 + 1125 = $8,625 This is a very realistic $ amount that it will take in to cover your monthly expenses. Dose this make sense?
* remember the difference between "take in" and "take home" can be very different. However they are both VERY IMPORTANT numbers for you to have great awareness about!
3,750 x .3 = $1125 So $1125 would be your estimated tax with hold. Let's now add this with your desired monthly "take in" income and see what we come up with. This will give us a grand total of what we would actually need to produce behind the chair to achieve our financial goal.
7,500 + 1125 = $8,625 This is a very realistic $ amount that it will take in to cover your monthly expenses. Dose this make sense?
* remember the difference between "take in" and "take home" can be very different. However they are both VERY IMPORTANT numbers for you to have great awareness about!
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