“Having your personal finance in place will allow you to walk into each and every sales environment with confidence, not needing the sale, but it also puts you in a more powerful position to engage with the customers and actually get that sale.” – Ben Lex in today’s Tip 1760
Do you have an emergency fund??
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Transcript
Scott Ingram: You’re listening to the Daily Sales Tips podcast and I’m your host, Scott Ingram. Today’s tip comes from Ben Lex. Ben is a fee-only fiduciary advisor, which means he does not sell products or make commissions. He is passionate about helping sales professionals across the US manage their variable income and plan for a successful retirement. Here he is:
Ben Lex: I’m excited to share this tip with you today. Today’s tip is not directly a sales tip, but it is a tip for sales professionals, and it’s a tip for all sales professionals, regardless of where you’re at in your career. It’s something I see sales professionals get wrong all the time. I don’t necessarily know why that is, but my hope here is to educate you so that you can actually make sure you get this right, and it will put you in a better position each and every time you walk into a sales situation. And that’s simply having an emergency fund in place.
Having an emergency fund for your personal finance affects your sales more than you would know. Some I know some of you might have experienced this before, but when you don’t need the sale, the sales often come and they come in an abundance. But when you need the sale and that’s apparent in how you’re engaging with customers, it can be the hardest thing to do. I used to work in sales, and so I know that space and environment, and it’s a challenge. Having your personal finance in place will allow you to walk into each and every sales environment with confidence, not needing the sale, but it also puts you in a more powerful position to engage with the customers and actually get that sale.
What is an emergency fund? At the end of the day, an emergency fund is money that’s sitting on the sidelines in case of emergency. If something were to happen that was really just unprecedented and unforeseen, maybe it’s a job loss, and most often That’s what we talk about with an emergency fund. Having a proper emergency fund in place is important for all people, but it is very critical for sales professionals because not only does it affect you mentally, but it also affects your spouse and your family, if you’re in that situation where you have a family, but it’s also going to allow you to do your job with more confidence. Having typically three to six months of expenses is going to be sufficient for most people. But we find within the sales realm that that’s not always sufficient. There are some people that work in sales where three months of expenses in an emergency fund is great, but not for everybody. And let me state that this money is not money that’s invested. This is money sitting on the sidelines ready for you in case something were to happen that you can access quickly. So maybe it’s in a savings account or a high-yield savings account.
And what you need to think about is, what is your situation? Do you have a family? Are you the sole provider for your family? Do you have a spouse that works? Do you have kids? How old are the kids? How many kids? And then in pertinence to your job, how specialty of a sales realm are you in? How easy would it be to find a new job comparable to the one that you’re in if you were to lose yours? These are all things to consider, all things to think about, but just some general recommendations for you. Really, the only salespeople I would recommend having three months of expenses in an emergency fund would be a sales professional that has a very healthy-based salary And they can live off their base salary if needed. That’s really it. If you have a stable role with a base salary plus commission, I’m okay with you having three months. Every other sales professional needs to have a minimum of six months.
And let me tell you some things that might I’m going to push this further. If you are a sales professional and you are in a highly competitive space, nine months. If you are a sales professional and you are the sole income provider for your family, minimum of nine months. If you are fully commissioned and you have a lot of variability in your income, that’s okay. It’s an amazing spot to be, minimum of nine months. And we can go up to 12 months. There’s a lot of factors that play into it. If you’re a fully commissioned sales professionals, and especially a high earner, and what we talk about with high earner is making more than about $300 to $350,000 a year, you might want to have closer to nine to twelve months. Maybe 12 months is where it’s at. That doesn’t mean the money is sitting there doing nothing. Like I said, you could potentially utilize a high yield savings account. It’s not just sitting there. But this is so important, not only for your mental space as you head into each sales environment, but it’s also super important to make sure you and your family are taken care of.
Scott Ingram: For links to connect with Ben, just click over to DailySales.Tips/1760. Once you’ve done that, be sure to come back for another great sales tip. Thanks for listening!