S3, Ep. 119- How I Plan For Large Business Expenses

Leah Gervais: Hey, visionaries, welcome back to the show. I hope you are all enjoying the end of summer. If you’re listening to this, when it is released, it has been very, very hot here in New York. I typically am not the biggest fan of New York in the summer. I think it’s the worst season here. Um, well, I don’t know if that’s true. I think August is the worst month here, I guess I should say. But, um, the summer does have a magic to it. August can just be so hot though, and I’m recording this at nine months pregnant.

So it has been a little different this year, but that’s okay. I have really focused on all the good things about being so pregnant in the summer. Like you don’t really have to put on pants or boots or coats. And when my son was born in late November, uh, three years ago, I remember really having to rely on my husband at the end there to like, put on shoes for me and stuff.

So just have to focus on the positive part of whatever you’re going through. I think there’s, there’s easy and challenging parts about late pregnancy, you know, no matter when.

So anyway, that’s what’s new over here. Um, I hope that you’ve had a wonderful summer. I hope you’re looking forward to September and Q4. Um, I was talking to my mastermind about this, um, my most recent call with them, but I especially think Q4 has the most potential when it comes to sales and business. 

Uh, so it’s really exciting that it’s approaching and, um, I hope that you’re feeling ready and, and getting your business ready for it. And today’s episode might help that this might actually not be so timely. Kind of depends, and it’s gonna be pretty short and sweet, but it’s something that I think is worth mentioning. It might even feel somewhat obvious to you.

But, um, I recently did another episode on a launch we did earlier this summer. And in that I talked about our budget for paid ads. For that launch, that budget was around $8,000. And I wanted to just touch on that, um, as a topic on its own, which is this idea of lump sum expenses in your business and how to manage that when you have a pretty consistent cash flow of a range of money that comes in monthly and a range of expenses.

 And I know, and I’ve gotten some feedback from that episode, that even when people are making 10 or $20,000 a month, when they think about spending 8,000 a month on let’s say ads in this situation, or another big expense that I think about a lot and plan for in my business are my retreats. I host two mastermind retreats a year, and I also frequently do international VIP days.

If you follow along with me, you know that I’ve done multiple in Paris over the past just like three years. Um, I also do VIP days in New York, but those aren’t as expensive, uh, in the, you know, as a one-time fee kind of because I live here. Um, the other ones really can accrue a lot of expenses because I’m also paying my own travel expenses and airlines and hotels and all of that. 

So for those, for my international VIP days or any VIP day where I travel, and then for things like launches when I know I, you know, we are gonna do so many launches a year and it’s going to, we need to think about how we’re going to pay for the ads we need for that. Um, or if you are investing in something that is a single lump sum payment, it might feel frustrating because you might feel like, man, I’ve worked so hard to make five figures a month, or to make, you know, 20 KA month, multiple five figures a month.

And yet when I think about bringing over 10, you know, five, 10 even maybe $15,000 in a single month, that feels really scary. That feels really tight. That feels like, um, I don’t have that much profit on a given month where I would know where that would come from. 

So let’s talk about that because I think it’s really important to set your business up for success in that you don’t want to avoid large expenses, large investments because of a cash flow situation. Um, they can be instrumental to the business growth that you need. You know, I can’t imagine my business without the launches. We have it a few times a year. I can’t imagine my business without, um, those, those list injections we have a few times a year and I definitely can’t imagine my business without my retreats and BIP days. They’re a big, big part of my brand and how I connect with my clients.

And I think what makes, especially my mastermind so special and so different. So we don’t want you to hold back on these things because of a lack of clarity of how and where the money will come from. So I thought I would just talk about how procedurally we do this in my business. So you can think about and start planning for your own large business investments. Typically, this is how it works. At the beginning of the year, I do an overall audit of my expenses.

Now I have a typical range of how much we spend monthly. I am not a bookkeeper. I’m not militant about our monthly spend. I probably should be more so, but I’m just not. I have a range of around how much I know we spend every month given what I pay my team, what I spend on ads on a regular basis, what I pay my own coach, um, the tech stack that we have, uh, any other business expenses accrued like, um, workspace.

You know, I have a coworking space that I’m a member of. I’m also a member of a social club that is part of this. So I have a range of give or take a few thousand dollars that we spend every month. And I’m comfortable with that. That’s good enough for me. I don’t need to know the dollar. It’s actually not as good of a use of my time because I could literally make more money doing something else than obsessing about things down to the last dollar. 

So I have a gauge of that. But then I look at the ones that I know are going to be big over the course of the year, like in 2025 for instance. I know that my mastermind is going to have a retreat here in New York as well as a retreat in Paris. Paris will be the most expensive retreat I’ve ever done.

I already know that. I already know my mastermind won’t be as profitable next year because we are hosting our first international retreat and Paris is outrageously expensive. New York, I ha New York is very expensive too. It’s hard to host retreats in New York. It’s definitely been easier when I’ve done it in places like, um, LA and Miami. It’s actually shocking how much cheaper LA is than New York. You think that they’re hand in hand, but they’re not. 

But Paris is on a whole different level. And even though I know Paris quite well, I have the benefit of living in New York and knowing it like the back of my hand. So I don’t feel like I need to do all this research from the ground up about where to host things. Um, so New York feels doable. Paris will be very, very expensive. So I know that now, right?

I’m able to start thinking about that now. Now we also then will think, okay, what times of the year are we going to do big launches when we need far more set aside for ads or we’ll need to spend more on ads, uh, than we typically will.

 So I’ll look at stuff like that. You also, some things that you might put in here are, you might take a maternity leave like I am this year and you might need a lump sum of money for that. You might be, even if you’re not hosting a retreat, you might be traveling to a retreat or to an event and you wanna make sure you set aside, you know, a few thousand or several thousand for that, whatever that’s going to cost you. Um, in years past, I probably will actually do this in 2025 ’cause it’s been a little while, but I’ll earmark uh, photography expenses.

Like I’ll just know that I wanna do a big brand photo shoot, um, that can cost some money. I’ve done videography in the past and that’s a few thousand dollars. So I’ll just try to make a list of things that I know are going to be high one-off expenses, and then I’ll add them all up. And then as simple as it is, I have a high yield savings account specifically for big purchases, big investments, big lump sum payments. I divide it by 12 and I just automatically withdraw money from my business checking account every month and put it in that high yield savings account. 

So it ends up working out that when the month comes along, when the retreat is hosted, or when the launch happens, or when the travel takes place, that I just withdraw whatever I spent that month on the retreat or on the ads or on the travel from my high-yield savings account that I have been setting aside money for, for all month, um, or all, all year on a monthly basis for that expense.

So what you’re really doing is simply turning what feels like a one time fee or one time big expense into part of your monthly expenses. You’re turning it into something that is more in the category of your monthly team. Spend your monthly coaching, spend your monthly ad spend, your monthly tech stack spend, anything else that you’re kind of just paying for monthly. 

This now feels like I’m just paying for it monthly because that’s where the money does come from and how frequently the money comes from. I just then get a little bit of interest accrued on it because it’s in a high yield savings account rather than a checking account, just sitting there collecting dust. And then I’m able to take it all at once and it doesn’t feel like it’s this gut punch for my business or like this scramble of needing to make up a surplus of money in a given month, uh, to make, you know, to make this, this payment come through.

So that’s really my whole system for it. It’s very straightforward. It’s kind of personal finance 1 0 1, but I think it’s worth just pointing out because I think sometimes we feel like we’re at the mercy of our monthly payments. And what that can do insidiously is the end. You end up having you feel like and being back in a paycheck to paycheck type way of running your business. So you might not be living paycheck to paycheck anymore because you’ve found a bit more financial freedom with your business, which is fabulous, but you also don’t want your business to be running paycheck to paycheck. 

So having that savings account for the expenses you know are coming down the line is really, really important for you and the health of your business. If you’re listening to this and you’re feeling like, okay, Leah, that’s nice, that works out well for you because you have enough money coming in every month to pay for these things.

I want to encourage you, this is something you, if you’ve listened to my podcast over the years, you’ve heard me talk about till I’m blue in the face, I want to encourage you to focus on your monthly recurring revenue. This is something that I work very closely with my clients on. It’s something that is extremely important, um, because it’s what helps you inform these types of decisions and it’s what helps you set yourself up for success with these types of decisions. 

So if it’s feeling like this is far from you right now, my recommendation would be to shift away from a monthly goal you might have right now and into how you can get your monthly recurring revenue stacked and slowly up. And you know, it’s only August right now. If you have a goal to have your monthly recurring revenue to a certain place by the end of the year, you’re in a great situation to spend the final five months of the year focusing on that and making that happen. And if you want help and support making that happen, consider applying to my mastermind. We are currently in the fast action enrollment period. We actually only have about a week left in this fast action enrollment period and those spots are filling, so don’t delay applying. You can go to leahgervais.com/mastermind to learn more as well as to see the application. 

But do keep in mind that when you go to that page you will see the pricing of the Mastermind and you currently are eligible for a $5,000 discount thanks to the fast action window. 

So now is a good time to take advantage of that if you’re interested. And if you have any follow up questions, let me know and I will talk to you guys soon. I hope you have a great rest of your summer. Thank you so much for tuning in.

Your Biggest Vision’s Daily Checklist for Visionaries;

Free Download!

Click here to download the checklist