If you want to build an mlm business effectively you need to get serious with your money. Money management is often underestimated and overlooked by mlm and direct sales business owners worldwide.
You dont have to be an accountant to make this work and with a few easy precautions you can be assured of having cash flow, rather than going bust.
The first rule of mlm money management
The first rule is quite clear, although it is the most dangerous one too. During your participation in your mlm business you will be asked to purchase company products. While this is alright in theory, it could proof destructive in reality.
And here is why: if you over commit your finances nothing good will happen to your business. To successfully grow any business you need to first earn money before you spend it. Time and time again I see people fanatically buy everything they are told (naturally it is always in their own interest), yeah. sure.
Be aware that you dont need all of the tools that are being shopped to you at the back end. The sooner you realize that this is often how your upline increases their own profits, the sooner you will strengthen your changes of long term success in your mlm.
The second rule of mlm money management
Once you have a clear hold of your spending habit,
remember income + curbing your spending = cash flow
you can take charge of your finances. It might be a good idea to put aside a percentage of your income every months into a savings account. Some people choose to save 15% while others choose more or less.
This account can be used for holidays, special purchases or even retirement. Its always good to have a backup plan, this includes finances too.
The third rule of mlm money management
Never commit all your savings into your mlm! I mean that. I nearly went bankrupt because I made that stupid mistake myself. I was blue eyed enough to believe pretty much everything I was told by my upline and got suckered into spending thousands of dollars for international events time and time again.
Ok, even though I have travelled the world with my mlm business I could have paid off my mortgage instead and once I was actually very close to faulting my mortgage payment because of that navet.
Forth rule of mlm money management
Dont take everything at face value. Be smarter than me and always double check facts. Especially hype! Do not fall for hyped up events, messages and sales pitches.
I have and it cost me dearly.
If you use common sense there should be no reasons why you couldnt become successful with your mlm business. Granted, your company has to be legal and there should be plenty of demand for the product or services you sell.
In the end, it always pays to be a little bit on the cautious side. It could save you a lot of money.