Small Money Becomes Big Money


If you cannot manage small money you will never have the chance to manage big money. Small money is all over the haircut business. You have the opportunity to play small in a big way. Manage small money and pretty swiftly you will be managing big money.

The shutdown of salons and barbershops due to the covid19 pandemic has exposed a real problem with haircut professionals. Few have any savings. Few have a back-up plan. Few can afford not to work even when their very life and the life of their loved ones is at risk. That is just not OK. We as an industry need some solid saving habits.

Following are six small money savings habits that any and every haircutter can implement immediately to start saving and start building a secure financial footing and future. Money in the bank is piece of mind. Money in the bank is options for your future. Money in the bank is protection against the unknown. There is a lot of unknown right now. Let’s start small right now and look to finish big.

Here are some ideas:

1. Pay yourself first – Before you pay the rent guy, the credit card guy, the grocery guy, the car payment guy… Pay YOU. This is an old concept but still holds up. Determine a percentage of your weekly paycheck that you can live without. Live below your full income. Take this amount off the top first. Put it away. This is how rich people get that way. Deposit it safely in a savings account, a retirement account or a brokerage account. Consult a financial planner to determine the best places and amounts for you to begin to save. Your age and retirement plan will determine where and how this should be saved.

2. Raise your prices – In order to have more money than you have month every month you need to raise your income. The way we do this as a haircutter is to raise our haircut price. I have been talking about this for years. I will likely never stop talking about this. If you own your own small business this is simply more revenue. If you work on a percentage this is more money in your pocket every haircut. More money is more money. Do not live on the more. Save the more. If you cannot stretch to save now this little bit more, this increase, becomes your savings. Do not let your lifestyle expand to fill up the money available.

3. Stash your 1st haircut – This is another pay yourself first idea. Using the value of a single haircut as a simple way to set aside a daily savings amount. Conceptually “stash” haircut number one every day. You still need this cut to be properly on the books. Account for it. Pay tax on it. I am not suggesting, in any way that you skirt the system. I am suggesting that you use the small price of a haircut as a daily savings amount. Put it away every day. This will become a big money very rapidly.

4. Divvy your tips – Divide your daily tip income into small piles allocated to savings projects. I started this in beauty school. I have done this my entire 33-year professional haircutting life. The number of plies varied from time to time. Here is an example of the piles I used. You may have a different number of plies. Your plies may have different names.

a. My retirement

b. My wife’s retirement

c. Kid #1 college

d. Kid #2 college

e. Rainy day fund

f. Tax man

g. My pocket

I was living on and spending 1/7 of my tip money. Tip money is real money and it gets big fast. If you let it run through your fingers you will burn through most of it and have nothing to show for it. If you save it smart you will turn little piles into big plies.

5. Hide your fives – Five-dollar bills are not that common. Every time you cross paths with a fiver put it away. Twenty to a bundle makes $100. Fives add up five times as fast as singles. If you develop the habit of saving your fives these little bills will become a big pile of cash.

6. Change adds up – Loose change is really loose dollars. Empty your pockets into a change jar every night. Do not spend change. Save it. Take the jar to the bank every month and deposit the money in your account. This can be hundreds of dollars every year. It is just another small-money saving idea that adds up big.

All six of these simple small money ideas

I am working on a digital document that will be making available soon. It will go into specific mathematical detail on what the long-term value of these saving concepts can be. It should prove to be an exciting eye opener for all.



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