Painting Business Owners: Is it a Good Idea to Move Money between buckets when using #profitfirst

If you just want to keep it simple in the beginning and just kind of understand the system, you basically have a bucket for profit, a bucket for taxes, a bucket for everything else.

When money starts to get a little tight, we get a little squeezed for cash. Our first temptation is to cut our profits, to take money that we'd normally keep for profits and spend it on other things. Is that allowed in this system or is this more of a hard division? Profit first, and then if we've got to make decisions about cash flow, well then we might need to tighten up operations or reduce our expenses, but we're not going to reduce our profits. Is that kind of the thinking?

Yeah. Once you move it into profit, you're not supposed to borrow from it. It's kind of the idea. You'll need to go in before you start doing it is understand what are your true costs going to be when you start this? Because if you start it and you just kind of guess, like, I guess I want this much, you know, you're probably not going to succeed at least the first time without kind of really understanding what your numbers are and where you should allocate.