| Buying or selling a business is a major step for all | | | | decided to become an entrepreneur. |
| entrepreneurs. It comes with obvious financial risk | | | | From my perspective, this is critical. We often |
| which everyone understands and prevents many | | | | decide to do something major in life at a certain |
| would-be-entrepreneurs from starting their | | | | point for reasons that make sense at that time. |
| journey. However, an element not many | | | | However, our lives are constantly evolving and |
| understand is that the business ownership comes | | | | changing due to many external pressures, almost |
| with many emotional risks that play a more | | | | all of them outside our control. To therefore have |
| important role than the money itself. | | | | a document to look back at and jog your |
| Entrepreneurs are constantly challenged by many | | | | memory why you decided to become an |
| emotional risks. The obvious one is success or | | | | entrepreneur can also help you decide in the |
| failure. For most entrepreneurs, once they come | | | | future if your objectives have been met and it's |
| to terms with the financial risk involved with | | | | therefore time to try something else in your life. |
| business ownership, their next challenge is coming | | | | Alternatively, it can be sustaining and invigorating |
| to terms with the fact that owning a business | | | | to remind you why you decided to become an |
| comes with the possibility it will fail. That alone is a | | | | entrepreneur and allow you to refocus on that. |
| concern but the real concern is what they will say | | | | Just to repeat an earlier point, it's important to |
| to family and friends. | | | | share your life plan with those who are close to |
| Another emotional risk which is part of an | | | | you. Don't share it too broadly as it may become |
| entrepreneur's journey is handling the ups and | | | | a document others judge or hold you accountable. |
| downs. Every entrepreneur hopes there are more | | | | It's not a document of accountability, it's a place |
| ups than downs but the downs are part of the | | | | to keep your thoughts so you can be |
| landscape of being a business owner. This means | | | | comfortable with the decisions you are making. |
| not only emotionally handling these situations but | | | | Some of the thoughts to keep in your life plan |
| more importantly, building and using different tools | | | | can include what's personally important to you and |
| and resources so they are available when needed. | | | | what you hope being an entrepreneur will allow |
| A further emotional risk is having the | | | | you to do. If it's to support your family and allow |
| self-confidence and self-belief that you have the | | | | you to also contribute to local society, include |
| skills, tenacity, and acumen to handle all situations. | | | | those thoughts. If values are important to you, |
| It is a given that the capitalist system goes up | | | | what values will you bring to being an |
| and unfortunately and inevitably goes down. Each | | | | entrepreneur? What are your priorities and how |
| phase of the economic cycle requires using a | | | | do you intend to manage those priorities when |
| different set of tools and approaches. Similarly, | | | | they come in conflict with other priorities? What |
| each individual business has its ups and downs. | | | | should happen with the business if something |
| Generally they follow the economy but this is not | | | | happens to you? |
| always the case. Many, many new businesses | | | | The ultimate goal of creating a life plan is so you |
| emerge and come to life in a recession. A new | | | | can become at peace with your decision to |
| entrepreneur sees a need or identifies a trend and | | | | become an entrepreneur. As I've mentioned, our |
| takes the idea to the market. The market | | | | lives are constantly evolving and changing. We |
| embraces the idea and so the business moves | | | | adapt every day to change. Being able to easily |
| forward and grows. If the idea is strong enough, | | | | and readily adapt to that change will be the main |
| it attracts others who also embrace the idea and | | | | ingredient to your success as an entrepreneur. |
| so competition pushes and refines the idea; | | | | Understanding why you decided to start that |
| another emotion an entrepreneur needs to handle. | | | | journey in the first place and being able to remind |
| So being an entrepreneur comes with different | | | | yourself about this will help you make the many |
| emotional risks. There are many more than the | | | | decisions along the way and keep you grounded. |
| ones I have identified above. However, to help an | | | | There is also great value in keeping your life plan |
| entrepreneur understand and manage the | | | | up to date, at least on an annual basis. Once again, |
| emotional risks, it's my suggestion that the first | | | | it will provide a sanctuary for your thoughts in |
| main action the entrepreneur puts together is a | | | | case you are confronted with major events or |
| life plan. | | | | changes in your life such as a serious health issue, |
| What is a life plan? | | | | death of a loved one, divorce, the birth of a new |
| A life plan is a very broad and simple document | | | | child, a major change in the economy or any |
| that answers some basic questions. They will vary | | | | other unknown situation. |
| with the individual and their situation. Part of the | | | | Part 3 of this article series discusses the |
| reason for writing your plan life is so you can | | | | importance of a Financial Plan to an entrepreneur |
| share it with the important people in your life and | | | | and includes some suggestions to help make sure |
| also as a place for you to come back to on an | | | | your work as an entrepreneur is a financial |
| annual basis or as needed to remind you why you | | | | success for you. |