Helping you learn from my mistakes

Over the last five days, I’ve been helping my brother-in-law retile his front entryway and into the kitchen.
In prep for the project, he expected the process would take three days. Friday to remove the old tiles. Saturday to put the underlay down and start tiling. Sunday to finish tiling.
As he’s redone two bathrooms before, and I’m pretty handy, I trusted his assessment of the timing. However, I’m heading back today to put the island back into the kitchen now that the 3-day tiling job was finish in 5.

We foolishly assumed that the house was reasonably square, which would have made the corner cuts easy. The house isn’t square, and those corner cuts were an absolute pain. And all that time we spent getting the right measurements down ate into our non-existent time-buffer for the job.
This mentality is very true when it comes to many peoples finances. So often, people will plan out their expenses and forget to build in a buffer. 

A vacation that you expect to $5,000 but costs $6,400.
A renovation that you expect to cost $75,000 but costs $95,000.
On the other end of the spectrum – an expected yearly commission of $120,000 but only $70,000 is generated.

The last is the most detrimental as that can impact your ability to invest in your business and make paying bills difficult.

There are two easy ways to prevent this from happening.

The first is having a healthy emergency fund set up. As a realtor, you should have 6 – 12 months of business + personal expenses set aside to protect you when your revenue is less than your expenses.
The second is having a corporation set up. This will help you set aside money for when your revenue is more than your expenses. 

If you find that you are going to earn more than you need in 2021, let’s have a conversation to help you know when to start the process of setting up your corporation.