Profit First is a cash-flow system that uses multiple bank accounts to allocate money for specific purposes. By paying taxes and profit first, then using what's left for expenses, businesses create discipline to pay down debt faster.
How can the Profit First system help me pay off debt quicker? So quick recap, Profit First is a cash flow management system. There are 4 core principles that set the framework of the guidelines. Profit First is meant to be guidelines. Pick the things that make the most sense for you. But here are the principles. Smaller plates. You know, if I have one giant plate, I can lose weight simply by filling up a plate that's a little bit smaller. So instead of one big bank account that I do everything out of, Have multiple bank accounts where I transfer money into it, into each of the accounts for specific purposes. Eat veggies first. If I eat my delicious broccoli first, I likely will have less room to eat all the carbs and maybe the less healthy things that are on my plate. Just like with dieting, there are certain elements of our cash flow that are going to be healthier for us to handle before we get to the junk food. Paying yourself first, setting aside money for taxes, setting aside money for profit distributions. Those are your veggies.
