"Why is it that I can never seem to get this damn credit card paid down?"
This is the question I kept asking myself with my business. Despite doing well and generating profits, it seemed like we never had the cash on-hand to pay down our credit card.
To be blunt, my knowledge of books and finances has been historically weak so this problem seriously plagued me.
Then eventually, as I really started looking at the books and modeling out our finances, it hit me...
I've been overpaying myself.
Not by a lot, but by enough that month-after-month, we would add to our credit card instead of paying it down.
I had been using the Profit First system, by Mike Michalowicz, but my percentages were just a bit too high.
As a result, I was taking a higher personal income that helped me pay down personal debts at a faster rate... all while increasing my business debts.
You need to learn your finances.
You need to master these skills.
Because there are so many things that are easy to screw up if you don't know how to manage your money.
For me, I learned to stop overpaying myself.
But the deeper I dig into financial management, the more I realize I don't know.