How Money Beliefs and Personalities Shape Entrepreneurial Success
How Money Beliefs and Personalities Shape Entrepreneurial Success
Our beliefs about money and the way we naturally behave with it form the foundation for how we approach opportunities, risk and growth in life. This is especially true for entrepreneurs and small business owners, where financial decisions are not just personal but pivotal to business success. In this article, we will explore how your money personality can influence your appetite for risk, why resilience planning is crucial for small business owners and how building multiple income streams can boost your financial wellbeing. Understanding your financial capability and resilience is the secret weapon to navigating the ups and downs of entrepreneurial life. It is time to take a closer look at how mastering your money mindset can power your professional and personal dreams.
Your Money Personality and Business Risk
Every individual has a money personality, whether it’s a combination or one is a strong stand out, you are generally a saver, spender, risk taker or an avoider. These innate behaviours shape the financial decisions you make daily, and they are especially influential when starting or growing a business. Entrepreneurs who are natural risk takers may jump into opportunities quickly, while savers might hesitate longer and need more certainty before investing. Both tendencies come with strengths and challenges. Recognising your money personality helps you play to your strengths while also managing your blind spots. Take time to assess your default money habits and consider how they may impact your business decision making over the long term. Tools like financial personality quizzes and coaching can help you better understand yourself and build strategies that work with, not against, your natural tendencies.
Take our Money Personality Quiz now to read more about yours.
The Double Edge of Flexibility
One of the greatest perks of entrepreneurship is flexibility. You can choose your hours, work from anywhere and have greater autonomy over your life. However, this flexibility comes at a price where there’s irregular income, responsibility for business expenses and a heavier financial burden when things do not go as planned. According to the Australian Small Business and Family Enterprise Ombudsman, around 97% of Australian businesses are small businesses, highlighting just how many people are balancing these trade-offs every day.
Planning for financial resilience becomes non-negotiable when flexibility is your chosen path. Successful entrepreneurs build financial buffers during good times to prepare for leaner seasons. It is also essential to separate personal and business finances to maintain clarity and reduce stress when navigating business cash flow fluctuations.
Why Financial Resilience is Non-Negotiable
Financial resilience is the ability to bounce back from setbacks without spiralling into financial stress. It is not just about saving for emergencies. It is about creating structures that allow you to respond to life’s surprises without losing momentum. Studies show that 60% of small businesses in Australia do not survive beyond their first three years. Building a resilience plan that includes cash flow forecasting, emergency funds and backup strategies is critical for long term success and peace of mind.
Start by reviewing your current financial position quarterly and adjust your plans based on changing circumstances. Additionally, setting realistic savings goals and creating a "resilience checklist" can help you stay proactive rather than reactive in managing your business finances.
As yourself these questions: What buffer do I have in reserve that I could use for an emergency? What situations classify as an emergency to use this buffer? What are the business milestones that are upcoming for me (both positive and/or negative)? What are the financial scenarios that would take place with hitting these milestones?
If you’re a risk taker or avoidant money personality, the planning and forethought here could be a challenge for you, but reaching out for support and working with a trusted business coach or financial wellbeing coach could help guide your process.
The Power In A Mindful Money Story
Knowing your money story means you understand why you do the things you do, or don’t do, when it comes to money. It’s about delving in and mindfully revisiting your past, your childhood, your cultural background, and your parents/family’s money history. The act of writing down your personal experiences with money means you can mindfully choose what beliefs and behaviours serve you and which you can let go of and leave in the past.
Why was money talked about the way it was? Who were the key players with money in your life? What were the big decisions that governed how your family lived, and how was the money flow handled? Who was trusted with money and who wasn’t? Is there a debt or a negative money story that you’re still avoiding or perpetually trying to overcome? Holding onto past money trauma can cause us to fall back into familiar patterns when things get challenging. Which money stories are still ruling you now, and will you allow into your future? Relationships with money can be re-shaped when we address the past.
The Power of Multiple Income Streams
One way to boost your financial resilience is by creating multiple income streams. Diversifying your income helps safeguard against downturns in any one area of your business. Whether it is offering different services, selling products or developing passive income opportunities, having multiple streams helps small business owners adapt faster and more securely.
The 2022 Xero Boss Insights Report found that small businesses that diversified income sources were 35% more likely to stay profitable through economic challenges. If you are just starting out, consider developing one additional product or service that complements your core business offering. Over time, you can expand your portfolio and create a more stable financial foundation for your business and personal life.
Do you feel like your business is your baby? If so, change or growth might seem painful. But what can you do to maximise what your business offers in a positive way to create extra services, products, or resources that provide financial security in challenging times? Spending time really understanding the complementary upstream and downstream processes, products, and services is time well spent, as it can help you also comprehend the end-to-end client experience. There’s a case for exploring the possibility of packing differently and offering current products/services to an entirely new application, target audience, or market.
Adaptability Is the Ultimate Superpower
Life throws curveballs, and successful entrepreneurs are those who can pivot and adapt when necessary. Whether it is shifting your business model, finding new markets or learning new skills, being adaptable ensures that short term setbacks do not derail long term goals. Developing this skill is deeply connected to financial capability. It’s understanding your numbers, your cash flow and your options at any given time. In the unpredictable world of small business, adaptability paired with solid financial skills builds real confidence. Conduct regular "what if" planning sessions where you explore potential challenges and brainstorm flexible solutions. Embracing change with a proactive mindset rather than resisting it can often open new doors and opportunities you had not considered before.
Staying adaptable in todays market means you’re:
Keeping up to date on industry changes
Being aware of broader market forces both inside and external to your industry
Staying abreast of regulatory and legal aspects
Utilising AI and upskilling in technology where suitable
Aware of the costs and avenues available to broaden or retract your business, including hiring and shrinking your team
Move and position your offering with the market trends and needs
Connected with a mentor or coach who has gone before you and achieved what you are looking to achieve
Maintaining a healthy group of likeminded people/businesses for support
Conclusion
Being a successful small business owner is not just about having a great idea, it’s understanding yourself and your relationship with money. By building financial capability and resilience, and recognising how your money beliefs influence your behaviour, you can create a thriving business and a fulfilling life. Embracing flexibility while planning for resilience, creating multiple income streams and staying adaptable are the keys to weathering any storm.
Remember, financial wellbeing is a journey, not a destination. Every step you take you are learning what works and what doesn’t, and you can always change things to work for the better. Tenacity, persistence and consistency are great traits when you’re an entrepreneur. Begin to incorporate these practises by taking small but consistent steps toward better financial health today so you can enjoy the rewards for years to come. Your entrepreneurial dreams deserve a foundation that is both strong and flexible, and financial wellbeing plays a big part of that.
This article provides general advice only. It does not take into account your objectives, financial situation or needs. Before acting on any information provided, you should consider the appropriateness of the information and the nature of the financial product in regards to your objectives, financial situation and needs. We recommend discussing your personal situation with a financial professional.
Blog article by:
DARLENE NEU
Co-Founder, Financial Wellbeing Consultant and Mortgage Broker
The Money Collective