Pay Yourself First: A Game-Changer for Marital and Business Finances
What if you treated profit as a priority instead of an afterthought? In his book Profit First, Mike Michalowicz challenges the traditional accounting formula—Revenue - Expenses = Profit—arguing that it leaves profit at the mercy of whatever’s left over. His revolutionary approach flips the script: Revenue - Profit = Expenses.
For Maritalpreneurs—couples balancing the demands of marriage and business—this mindset shift can transform how you manage money, ensuring that your goals and priorities are funded first. By focusing on profit, you create financial stability and freedom, both in your relationship and your business.
The Profit First Formula
The core of Profit First is simple: Allocate a portion of your revenue to profit before paying for expenses. This approach forces you to manage expenses within what’s left, rather than letting them consume your income.
By prioritizing profit, you build a financial buffer, reduce stress, and create a foundation for growth—whether in your family’s finances or your business.
Practical Applications of the Profit First Formula
1. In Marriage: Treat Savings as Profit
Applying Profit First to your household finances ensures that your family’s future goals come first.
Step 1: Create a “profit account.”
Open a joint savings or investment account dedicated to long-term goals like buying a home, funding education, or building an emergency fund.
Step 2: Allocate a percentage of income to the account.
Example: Transfer 10% of your monthly income to savings before paying bills or discretionary expenses.
Step 3: Adjust expenses to fit what’s left.
Prioritize essential costs and find ways to reduce non-essential spending.
By treating savings as non-negotiable, you ensure consistent progress toward your family’s financial goals.
2. In Business: Prioritize Profit to Ensure Stability
Profit First is a game-changer for business owners, helping you build financial health and stability.
Step 1: Set up a dedicated profit account.
This account should be separate from your operating expenses and payroll accounts.
Step 2: Transfer a fixed percentage of revenue to the profit account.
Example: Allocate 5–15% of all revenue to profit each month.
Step 3: Avoid dipping into the profit account.
This account is reserved for distributions or reinvestment—not to cover unexpected expenses.
By building profit into your financial process, you create a safety net that protects your business during lean times and supports future growth.
3. In Personal Growth: Automate Savings for Your Future
Using Profit First principles in your personal finances helps you prioritize growth and security.
Step 1: Identify a savings goal.
Example: Build an emergency fund, pay for professional development, or save for a meaningful experience like travel.
Step 2: Automate transfers.
Set up automatic transfers to a dedicated savings account with every paycheck.
Step 3: Protect your savings.
Treat the account as untouchable, except for its intended purpose.
Automating your savings ensures consistency, helping you stay on track with minimal effort.
Conclusion: Profit is a Mindset, Not Just a Number
The Profit First formula isn’t just about managing money—it’s about prioritizing what matters most. By putting profit (or savings) first in your marriage, business, and personal life, you create stability, reduce stress, and build a foundation for future success.
Ready to align your finances with your goals as a couple and as leaders? Visit www.MaritalPreneurWeekendIntensive.com to explore workshops designed to help you thrive in both marriage and business. Start building a future where profit and purpose go hand in hand—apply today!
