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Take Back Control Of Your Cash Flow In 4 Easy Steps
On this episode of HVAC Revealed, we took a financial lesson with Tim Yurek, the founder, and CEO of Tier 1 Capital, a leading national financial consulting firm.
We dove headfirst into business finance, discussing what companies are doing correctly and where they fall short. Tim’s unique perspective offered a fascinating exploration of the financial landscape, focusing on the crucial aspects businesses must pay attention to for financial success.
Cash Flow Is The Lifeblood Of Your Business
This essential financial component represents the money that flows in and out of business, enabling it to fund operations, invest in growth, and meet its financial obligations. Proper cash flow management is paramount, ensuring a company can continue operating while preparing for future growth.
Most businesses have a problem with cash flow because they don’t control it. Their money goes into paying salaries, utilities, rent, and inventory. They need to purchase new equipment or repair current equipment, and most of the time, businesses borrow money to fund these initiatives, whether it be a loan credit line or borrowing from an investor.
When we borrow money, who ends up profiting from that decision? The lender! They earn the interest, they use our repayments to fund other investments, and we lose money that could have otherwise been invested in ourselves or our business.
Nobody Wakes Up In The Morning and Says, How Can I Screw Myself Up Financially Today
We’ve been taught our entire lives that we need to live in this constant debt cycle to fund our dreams, but we actually “need to learn how to use the money to [our] benefit,” Tim explained. His business, Tier 1 Capital, bases much of its consultation on a four-step system to manage your cash flow. It has been an eye-opener for most of his clients.
Step 1: Identify where you're giving up control of your money, unknowingly and unnecessarily
You’re climbing your way up, making moves, thinking every financial step is a step forward. This is what you’ve been taught, what everyone else does, and how you’re supposed to handle your money, right?
But the methods you thought were rocketing you towards financial success, in reality, are hurting you. “If what you thought was true turned out not to be true, when would you want to know,” Tim asked.
Of course, it’s a no-brainer: as soon as possible! The quicker you uncover any financial missteps, the faster you can recalibrate your plan and pivot towards gaining control over your cash flow again.
Step 2: Stop Doing It!
Easier said than done. “It’s hard because it’s what you’ve been doing, what everyone else has been doing, and how we’ve been trained to do these things,” Tim explained. It’s a vicious cycle that we get ourselves into, and to stop it from continuing, we must stop our bad habits.
Once you’ve identified where you are losing control, you have to consciously stop and create a new plan to regain that control in your favor. This can take some time, weeks, or even months, but you must stay on course to swing things back in your favor.
Step 3: Save That Money
The loan or credit line payments you’ve been making are already built into your cash flow, so now it’s about taking dedicated money and putting it into an area you own and control. Whether that’s savings or your business, it has to be somewhere that you have access to it and where you are profiting on those payments.
Step 4: Borrow Against Your Own Money
Once you have money accessible to you and controlled by you, use it. “Borrow against yourself, pay interest to yourself, and rinse and repeat,” Tim explained. “Your money never ends up leaving your control.”
This gives you the freedom to save for emergencies, expansion, or succession; it gives you peace of mind and relief that you can be self-reliant and grow your business as you see fit.
Get The Whole Picture
Alright, we’ve given you a sneak peek, a quick tour of the critical steps to financial fluency and cash flow management. But guess what? There’s a whole treasure trove of insights and secrets waiting for you! All you’ve got to do is tune in to our podcast, HVAC Success Secrets: Revealed, for the full experience. Dive deeper into these four steps, uncover more knowledge nuggets, and let the expert voices guide you toward achieving financial mastery.
Until Next Time,
Evan and Thaddeus
About Tim Yurek
Tim is the founder and CEO of Tier 1 Capital, a leading national financial consulting firm. Over his 35+ year career, he has worked with thousands of families nationwide, helping them achieve their financial goals – like sending their children to college, purchasing a new home or property, planning for business succession, and successfully navigating through all stages of their financial journey!
