Rhondalynn Korolak

How to combat your client’s ‘poverty’ mindset

http://yuktung.com.my/esnew/309 Are you having another one of those months where most of your clients are struggling with cash flow and working capital issues?

what the best age to start dating Here’s why your clients are likely on struggle street. The needs of your clients for a quick hit of cash to make payroll (or cover a tax bill) is the equivalent of a drug user who has just dropped to the ground. Calling an ambulance may get them back on their feet in a relatively short period of time, but it is a poor substitute for treating the underlying emotional reasons that caused their addiction and putting a plan in place to help them stay clean.

http://freejobseeker.com/author/charan/ If your clients are constantly struggling with cash related issues, it’s highly likely that they also have “chronic poverty” mindset — and unless you are prepared to work with them to address the problem from the inside out (dealing with both the financial literacy and the emotional and mindset elements), you will never have a successful advisory practice. In order to help your clients move beyond these roadblocks that keep them poor, you must first identify the underlying reasons and then work with your client to address them at the source.

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http://metodosalargarpene.es/ebioer/153 http://sortsystems.es/?fiesred=conocer-mujeres-lima-peru&ace=02 1. Profit, money and tax are bad

Money is simply a piece of paper that you use to pay for things. Profit is merely an accounting term used to describe what is left over after all expenses are deducted from the revenue generated. It’s not even a real or tangible thing that you can take to the bank and deposit. And tax is something that you pay the government when you have made sales and profit. When your client attributes a negative or evil connotation to these words, they unknowingly set themselves up for a world of pain and struggle. The brain is a survival focused mechanism — it wants to keep you out of harm’s way. If your client truly believes that money, profit and tax are bad, their brain will do everything in its power to protect them from it — which essentially means that at a deeply subconscious level, your client will sabotage himself/herself in order to avoid the pain of encountering these things.

When you assist your clients to let go of the negative meanings they have attributed to money, profit and tax, it frees them up to attract more of them into their life, which is a good thing.

here 2. Penny-wise, pound-foolish

Have your clients ever told you stories about how they went far out of their way to buy supplies, fuel, or printer cartridges because they were a few cents or dollars cheaper? Have you witnessed them purchase things they didn’t need (or bought in bulk) just because they were offered “a good deal”? Even though they thought they were saving money, these bad habits invariably end up biting them in the bank account because they waste more time, money, and energy than it’s worth chasing them.

I’ve seen clients waste days of their time on saving $100, yet think nothing of entering into a contract to purchase an item worth $100,000, when they are short on cash, the return on investment is poor, and they didn’t bother asking their lawyer or accountant to review the contract before they signed it.

If your clients are pound-foolish, it’s going to take more than sheer willpower and a stern talking to from you, to help them break free. Neuroscience has proven that takes 21 days to break or form a new habit, and your clients will need consistent and impactful support from you to ensure they prioritise financial decisions and evaluate them properly.

follow 3. Scarcity mentality

If your clients have scarcity mentality, they will tend to view life as if there were only one pie and if someone else gets a piece of it, it means there is less (or not enough left) for them.

Scarcity is particularly dangerous because it affects your client and everyone else that they deal with. It means that they are less likely to want to share (and that includes power, profit and recognition). Furthermore, it focuses your client on the extreme short term of every decision and causes them to ignore the long-term consequence(s). Scarcity directly impacts cash flow because it causes them to feel compelled to use up resources they have right now so that they can’t be taken away from them later. That is precisely why it leads to impulsive and bad decisions.

Abundance on the other hand, flows from a belief that there is plenty enough for everyone. When your clients choose to focus on abundance and gratitude, it results in sharing of prestige, profit, and decision-making. And it opens up possibilities, options, alternatives, and creativity.

http://calonline.com/?q=viagra-without-a-doctor-prescription-from-canada 4. Entrepreneurship is hard

Many entrepreneurs make the mistake of thinking that in order to create a successful business, they need to work themselves to death and plough all their cash back in. They often pay themselves very little, even when their business is actually quite successful.

Perhaps even more commonly, many owners pay everyone else first (including employees, the tax man, the bank, and all suppliers) and often overlook and undervalue the role they play in their own company. In order to value themselves, your clients need to learn that putting funds aside for their own pay and retirement, and earning a profit, are essential to having a successful business.

Creating an intentional system — with a regular salary for each owner and vacations to rejuvenate — means your clients are putting the right building blocks in place to overcome their poverty mindset and create a healthy and sustainable company.

grafici forex multipli in tempo reale 5. Not feeling worthy

Small business owners rarely charge what they are worth. Whether it’s due to a lack of self-worth or just a fear of losing sales, it never pays to undercharge. Your client’s price directly impacts their margins, and margins are one of the key determinants of cash flow. While it is possible to have a high net profit margin and low cash flow due to mismanagement, it is actually rare to have low margin and high cash flow. Unless your clients are raising capital or selling assets, it is impossible to have high cash flow unless they first start with decent profit.

That is why it is imperative to help your clients narrow the focus of what they do so they can command a premium price. If they let customers or competitors drive the price down, then they will be doomed to continually face cash flow issues.

It is your job as their trusted adviser, to show them how to demonstrate the value of their unique solution. Until your clients believe that “they are worth it”, no amount of financial literacy training or forecasting will fix their cash flow problems.

So, what can you do about it?

As long as you continue to focus reactively on merely the technical and financial aspects of your clients’ cash flow, you will struggle each month to add value, gain leverage, and create influence with them.

To put an end to your clients’ cash flow drama once and for all, you must strengthen your mindset, soft skills, tools and resources as an adviser.

Make a plan to shift or reframe their mindset or belief to the positive, or support them over a period of at least 21 consecutive days if they need to break a bad habit (or form a new positive one). To do this effectively however, you will also need to invest in developing your soft skills to gain the knowledge and tools that you need to tackle these issues from the inside out.

Remember, these emotional blockers, fears, limiting beliefs and self-sabotage are deeply ingrained in your clients. It’s going to require more than positive thinking, financial literacy, and quick, band-aid fixes to overcome them.

But the good news is that those beliefs can be overcome and you can learn the soft skills that you need to help your clients combat and crush them.

Rhondalynn Korolak, managing director, Businest Pty Ltd

2 thoughts on “How to combat your client’s ‘poverty’ mindset

  • May 18, 2018 at 3:20 pm
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    Attention : Rhondalynn Korolak
    Dear Rhondalynn
    Re How to combat your client’s ‘poverty’ mindset
    My parents owned a newsagency, back in the 1970’s there seemed to be always that poverty mindset. Most of the things in the shop were under $5. The loophole was it was a matter of selling a high volume of newspapers to ad the the “goodwill” value of the business since that was how newsagencies were valued. Really though my parents worked themselves nearly to death, opening 7 days per week for 10 years only taking off Christmas Day each year and most morning starting work at 5 am to deliver paper and intiially starting at 2am on Saturday and Sunday until they decided to pay other people to do deliveries. . Intially we lived in a derelict house that was the old post office residence close to the shop and it cost $12 per week rent. It was demolished after we moved out to a better place that was on 5 acres. Still even that place had a lot of problems, snakes, long grass, burnt out car wreck in the front yard, dead birds in the wall cavity, septic tanks
    So I spent my teens in those type of places.

  • May 18, 2018 at 3:25 pm
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    So I must add, a person can pour everything, all their money and time into a business and neglect house and family. Businesses can turn kids into business orphans or latch-key kids. So in my teens I’d wake up and Mum and Dad would already be at work. I’d go home and cook tea for myself or sometimes for my parents as well if they were going to leave the shop early

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