From Bank Balance Panic to Calm Control

This month, we’re in Stage 3 of the Business Evolution journey: Cash Flow Confidence. By now, your business has steady work and decent revenue — but finances still feel like a roller coaster. It’s time to replace that anxious “bank balance check” with calm, confident control.

In school, I treated the syllabus like most people treat their cash flow spreadsheet: something I meant to look at but rarely did. I kept it all in my head, and somehow made it through. That same laissez-faire approach worked fine for a college budget but it’s a terrible way to run a business. I think it was Steve Martin who said that chaos amidst chaos isn’t funny, but chaos amidst order actually is. Where does your business fall?

The Symptoms

Let me paint a picture and you tell me whether you feel seen or not.

The basis for understanding the finances of your business, and therefore the bedrock of your business decisions, is your bank balance. If the balance is going up, business is good, albeit still somewhat stressful. If the balance isn’t moving, business is still good and still stressful. If the balance is going down though … business is not great but you don’t let on and try to put on a confident air when out in public? Oh and you’re even more stressed out.

At times, you have to scramble to pay the taxes when they’re due. Maybe you put that date off as long as possible while you try to get the money together for what your accountant is telling you it’s going to be.

Other times you’re looking at the balance and thinking there might just be enough to pay yourself this month, or give yourself a bonus. And yet there are an equal number of times where you’re looking at the balance and you’re not sure there’s enough in there for the next wave of payroll and expenses.

Maybe you’re really on the ball and you’re checking that balance regularly. You know that it’s low in the middle of the month, but higher at the end of the month. You know you shouldn’t panic and yet …

There’s this cloud of uncertainty, this fog of war that follows you everywhere all the time.

The Real Problem

Bank balance management forces you into a passive and reactionary state. You’re looking at a single number and you’re trying to infer meaning from it that will guide your strategy, the investment decisions for your business, your personal finances, your relationships with coworkers and at home, and so much more.

One single number at a single moment in time.

If you’re not totally on the ball, you might not even know that the balance is cyclical … higher at certain times and lower at others. You’ll be spending more freely at the top of the curve and freaking out at the bottom. It’s quite the roller coaster for you, for your employees, and maybe even your vendors or customers.

Imagine Tim Cook running Apple like this. Imagine any large successful company in this position.

Stop for a moment and consider: do you think driving more revenue will solve the problem?

What is the problem anyway?

The problem is you’re driving a car on the highway with the door open, staring at the pavement as it flies by beneath your vehicle. You are not looking down the road, you’re not watching the other drivers, or keeping an eye on the map to make sure you’re going in the right direction.

This isn’t so much a you problem as it is a systems problem. The system you’re currently operating within necessitates stress and insecurity at every step. Making more money doesn’t change the system, it just adds zeros to the numbers you’re looking at and potentially makes the stress worse as a result.

You need to stop reacting, see more than just the one number, at the one moment. You need a new system that allows you to learn from the past, understand the present, and plan for the future.

Calm Confidence

Alright, you’re ready for calm confidence. How do you get there?

Your new system will have three key elements:

1. Transparency or visibility
2. A rhythm
3. Separation

Visibility

Create (or look at) a dashboard that shows you the money coming in, and the money going out. It can be a simple spreadsheet, or a dashboard in Quickbooks, or whatever tool you use to keep your accountant happy. Where’s the money coming from, where is it going, and when.

Visibility.

Rhythm

Pick a regular cadence to view these numbers. Your best bet is weekly or biweekly. To avoid overwhelming yourself initially, just schedule a recurring meeting for yourself at the same time each week, or every other week, and use that time to just sit down and look at what money came in that period, what money went out, and understand what drove those flows.

Later when you’re feeling less intimidated by the whole thing you can start thinking about how those numbers change over time and what that means but for now just give yourself visibility and do so on a regular and consistent basis.

Separation

Use separate accounts. When you earn money, have that money go into a very specific account only used for collecting income. From there, set aside money for taxes in a separate account that does nothing but hold taxes. You can and should set aside money for the expenses you expect to incur over the coming weeks as well. You can call that the operating expenses account. There could/should even be an account where business profit gets put after all expenses are managed (including payroll, including your own salary).

This process of managing your money across separate accounts is really useful for visibility as well because you’re back to looking at bank balances, only now many of them represent your preparedness for the future.

There is no single best way to set up this account system and the distributions among them. That said, if we work together we can figure out what works best for you together, but the takeaway here is that separation is important.

It supports your visibility and it is supported by your rhythm.

The Shift

With visibility, a consistent rhythm (it wouldn’t be a rhythm if it wasn’t consistent), and separation, you will start thinking differently about every dollar. Not with anxiety, but with clear-eyed anticipation. The confidence comes from seeing and understanding the natural cash flows within your business. You’ll know where your money is coming from, and when. You’ll know where your money is going, and when. You’ll be prepared for taxes when they come, so that stressful scramble is gone. You’ll have slowly developed an emergency fund (kept separate of course) to cover any unexpected lows.

Your decisions aren’t reactionary anymore. They’re strategic.

You will be calm and confident because you know what’s going on.

Because you are in control.

Take Action

This week, set a 15-minute money meeting with yourself. Look at what came in, what went out, and what’s next. Don’t judge it, just see it. That’s where calm begins.

Next week, we’ll talk about forecasting — the habit that turns your new rhythm into a real early-warning system.