Financial planning: money rules
For better or worse, money is the ruler when it comes to the business side of ranching. Our goals and dreams extend far beyond profit. We want to see the land heal and flourish, the livestock thrive and our families live a comfortable, meaningful life. Money is simply a tool. Learning how to manage that money in a business like ranching is easier said than done.
In the first five years of our business we did not have a holistic goal, much less business plan nor a financial plan. When my partner (and wife) Mandy and I took the Holistic Management International (HMI) Financial Planning Course it changed our lives. It gave us control of our money and our future. Many of us think of the word “financial planning” and it makes us cringe. The worst disagreements are often over finances. We think of tax season or budgeting. Often this is done on scratch paper that gets lost on the desktop and eventually thrown away. How boring is this going to be? I felt the same way for the first five years and during those years we lived paycheck to paycheck without any clear idea of where our operation would be in the next year. I have since learned to love financial planning. It has given us clarity in our direction and allowed us to make sound decisions.
The first step in financial planning is to know your holistic goal. The holistic goal ties what you value the most in life to your life support system. One of our holistic goals at Parker Creek Ranch is to “generate a healthy profit from the land in order to support our family and invest in things we believe in.” The holistic goal includes quality of life, forms of production and a future resource base. All of your decision making process will be based around the holistic goal or goals. The next major step is to organize a huge amount of complex financial information, taking one step at a time. At this point you will need to have a deep commitment to achieving your goals to make that possible. I didn’t say that creating a financial plan would be easy.
I’m not going into the nitty gritty details about financial planning today. There will be future blogs about some of the things we did right and wrong with our financial plan and how to avoid those issues. I just want to give those seeking information an overview of why it’s important and how to get started. Creating holistic goals and a solid financial plan from year to year has saved our business an immense amount of time and money. Simply put it has given us a peace of mind. The best way to learn it is to do it. Don’t just take the financial planning course. Buy the Holistic Management book, buy the Handbook and take the Holistic Management International courses online. It will be one of the best investments you ever made for yourself, your team (family & employees) and your ranch business.
