Doing the books

There should be more than just income/outgo in your ledger

A lot of tool dealers fall into a problem because they feel rich. You’re walking home, you’ve got a $1,000 wad in your pocket, and are feeling happy with that money. Then, they make the biggest mistake. They dip into it and take $5 to go to lunch. They rob their till.

I take every bill that a person has in a year. I mean every bill: Car registration, kids soccer, ballet lessons, child care, etc. I need to know every bill that you will spend some time during the year, down to the miscellaneous expenses of even taking the kids out for a Happy Meal. I have to work closely with the dealer, to know all the debt, because unless I know all the bills, I can’t account adequately for the whole budget. Your bills change. You should be reassessing your life and bills every three to five months.


I want everyone to be debt-free. I want tool dealers debt-free, I want them with health insurance, I want them with life insurance, and I want them to start putting money away for retirement. And most people think that’s really hard. It’s not when you live weekly. Plan out a little bit every week.

You should have a 401k for retirement. You need to be putting some money in somewhere — a mutual fund, a CD. It’s pulling out money weekly. We’re tool dealers, we don’t do anything by the month.

Tool dealers are a little different breed. They don’t all think about what happens if they’re not going to be there. You work a job at State Farm, or Chase — you get life insurance, usually from your job. We’re tool dealers, nobody does that for us. You need to do that for yourself. If you can’t afford whole life, don’t do whole life. Do term. Do a 20-year term.

On the tool truck, it looks like you’re making more than the job that you left, but you have a business. And you’re still not taking care of things, life insurance, health insurance, 401k. It’s really easy to fall into the trap of ‘I’m going to borrow some money from the business’ then you don’t put it back. There are little ways that you shortchange yourself without really realizing it.

It just comes down to living within your budget — anybody can do a budget, it’s just living within it becomes the issue.


• You should be reassessing your life every three to five months. You really should be reassessing your bills… You’d be surprised at how much things change.
• Know your finances. Don’t underestimate what you spend.
• Live within your budget; anybody can do a budget, but living within it becomes the issue. Stick with it. Especially when you’re new, it’s even more critical.
• Biggest mistake: Don’t rob your till.
• Tool dealers should have life insurance. I don’t think that’s something you wait until you have money for. That’s not fair to your spouse.
• You should have a 401k for retirement. You need to be putting some money in somewhere — a mutual fund, a CD — and adding in money weekly.
• If you pay your tool bill on a credit card and are paying it off without interest or finance charges — then you’re racking up points. That’s free air miles to go to your tool rally.
• No toys (RVs, wave runners, four-wheelers, etc.) for three to five years. Make sure your business is solidly off the ground first.

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