Do you know what being a millionaire actually means? It surprises me how many people are confused by this - it’s simply your NET worth being in 7 figures.
That’s NET worth.
That’s NOT how much you’ve predicted your business will do this year.
That’s NOT how much your business TURNS OVER, in a year or cumulative years.
That’s NOT how much you think your database is worth.
It is simply the cash that you have access to RIGHT NOW. Well let’s say within 72hours, because mine is mostly all invested in the stock market and I couldn’t get it out today.
I was recently having a conversation with one of my clients over text messages.
She had just made some SERIOUS money. Over $100K in sales in a week. In a business that just last year did that in a WHOLE year.
This client was calculating out some numbers for the next 12 months of how many people she needed to get to her turnover goal of doing $1million.
At the end of the message she added - AND THEN I’LL BE A MILLIONAIRE LIKE YOU!
I was like, Hold up a second, do you understand what Millionaire actually means? Because it’s not your business turnover. It’s your Net worth.
She responded totally confused by what that meant.
Now this client of mine is not an idiot by any stretch of the imagination, university educated, been in business for 4 years, totally switched on and incredibly smart.
I then realised that this was the problem with people using “I’m a millionaire” so loosely all over the internet, they don’t understand what it actually MEANS. They aren’t all intentionally lying, some of them are for sure, but a lot of them aren’t, they genuinely think that they are millionaires.
Let me tell you what I explained to my client.
You can have a $1million turnover, a $5million turnover even a $100million turnover in your business. But that DOES NOT make you a millionaire. And when I say TURNOVER here, that’s not predictions, that is what cash actually comes into the business and would be the income on the profit and loss statement.
Turnover does NOT equal Net Worth.
All of those turnovers could have ZERO profitability. Hell they could even be running at a loss.
How many huge corporations do we see in the media that have gone into liquidation, declare bankruptcy? The reason for that is because they have NO cash and too much debt, they can’t keep operating.
Turnover is Vanity. Profit is Sanity and Cash is King.
So focusing on “I’m a millionaire because my business turns over 7 or 8 Figures” is just a vanity statement and means NOTHING.
Your profit is also different to your cash.
Yes that’s right, your PROFIT is different to your CASH.
Have you ever had your account give you your P&L and it shows a figure there for the profit and you think to yourself, “Cool, so where is all that money because that’s not in my bank account?”
Nearly every business owner that I deal with has had that happen, myself included.
The reason for that is that PROFIT is a theory. It’s a number that accountants make up when they move things around.
The most important number that you need to be tracking and looking at is your CASH.
When you are in business if you are not looking at your cash flow then you are fucked.
I have had many situations over the years where when I’ve taken my eye off it even for the shortest time period, I have ended up in a situation where I’ve regretted it. Because cash is the most important thing when it comes to running your business financials.
The problem is that most people in business don’t really look at ANY of their numbers, if they do its normally at their turnover - which is a VANITY number.
So back to the whole millionaire thing, because I could rant about this other stuff all day.
If your $1million dollar a year turnover business, has $300,000 CASH left over AFTER all expenses are paid, tax is paid then your have $300,000 NET for that year period.
If you managed to do that consistently for 4 years running and NOT TOUCH any of the money in that time period then you would have $1.2million dollars, correct?
THEN you could say that you were a MILLIONAIRE.
Your NET worth is in the 7 figure bracket then. Despite your business turning over collectively $4million in 4 years, you were not a millionaire until your CASH hit that.
Also - no one should be quoting their business turnover as a collective over multiple years. If you are doing that just stop. Remember: Turnover is Vanity. But it’s even worse when you are trying to make yourself sound even better by saying you have a $10million business but it’s actually been over the last 15 years.
I feel as though this is so simple but so many people are confused by it because of how many other people are confused by it and using the wrong terminology for the wrong situation. As I said earlier, most of them just don’t understand it but some people are lying purposefully about it.
It’s funny to me in a way because when I had my status click over into millionaire a number of years ago, I was extremely disappointed.
I know many of you will read this and think “How on earth could that be the case?”.
I am extremely grateful for my situation, don’t get me wrong. But I think on some level I thought that confetti was going to magically rain from the sky and fireworks were going to go off and magically everything that was wrong in my life would be fixed.
Instead - NOTHING.
No magic confetti or fireworks.
Nothing in my life changed. It meant nothing. I just kept doing what I had been doing and life kept going.
What happened from there over the last few years is a story for another day, so many lessons to share and not enough time!
I love talking about money and teaching others about money, I run an entire event called Money Magic that’s dedicated to teaching my clients everything I know about money!
I take people that HATE talking about money and think they are terrible with numbers, to falling in love with their numbers and feeling powerful because they understand what’s happening with their finances.
I’m thinking about putting together a short MONEY course covering things like:
Creating more money in your life through personal streams and YOUR BUSINESS
Creating POSITIVE money mindset - so that when you get the money you actually KEEP it and learn to LOVE numbers!
Money management techniques to create long term wealth - this is also so that you can keep it and have skills for life to help you live your life the way you want to.
Now none of this is financial advice *disclaimer* but what it is, is real life experience coming from someone that had a ledger book at 7 years old (yes, true story) that has had a great relationship with money since then, that lead me to build multiple business, multi-million turnovers a year and a NET worth in the 7 figures in my mid 20’s.
This is the kind of thing that only someone that has been there done that can really teach. It’s not theory - it’s real life experience.
If I was to put this together for you, an inexpensive short course to help you create more abundance with your money and your money mindset coming from a legit millionaire businesswoman - would you be interested?
If so, click the button below and enter your details.
I want to help create more legit millionaires in the world - not the ones that have the definition wrong!