Young and Profiting with Hala Taha - Business Finance Masterclass: This Cash Management System Increases Profits For Every Small Business Owner!!

Episode Date: September 15, 2023

What if you could implement a cash management system today that guarantees profitability, automatically sets aside money for tax season, and ensures you don't overspend on expenses? In this episode, Hala is joined by Mike Michalowicz to break down Profit First, the cash management system that has helped hundreds of thousands of small business owners increase their profits, or generate a profit from day one. Mike Michalowicz is the entrepreneur behind three multimillion-dollar companies and is an author of business books for entrepreneurs and small business owners like Profit First, Clockwork, The Pumpkin Plan, Fix This Next, and Get Different. Mike is a former small business columnist for The Wall Street Journal and regularly travels the globe as an entrepreneurial advocate. He became a business author with a clear mission: eradicate entrepreneurial poverty.  In this episode, Hala and Mike will discuss: - What happens when you constrain a resource - How to think of profit as a habit - The value of practicing fund preallocation - The five bank accounts every small business owner needs - The difference between an ownership salary and profit - How much money should you put toward profit? - Why you should compress your operating expenses - How to pay off debt - How Relay can help you implement profit first with ease - And other topics… Mike Michalowicz is the creator of Profit First, which is used by hundreds of thousands of companies across the globe to drive profit. Today, Mike leads two new multimillion-dollar ventures, as he tests his latest business research for his books. He is a former small business columnist for The Wall Street Journal and a business makeover specialist on MSNBC. Mike is a popular main-stage keynote speaker on innovative entrepreneurial topics; and is the author of Get Different, Fix This Next, Clockwork, Profit First, Surge, The Pumpkin Plan, and The Toilet Paper Entrepreneur. Fabled author Simon Sinek deemed Mike Michalowicz “…the top contender for the patron saint of entrepreneurs.” Sign Up For Relay – Our #1 Banking Choice For Small Business Owners: Relay: https://relayfi.com/profiting **Relay is a financial technology company, not an FDIC-insured bank. Banking services and FDIC insurance provided through Evolve Bank & Trust and Thread Bank; Members FDIC. The Relay Visa® Debit Card is issued by Thread Bank pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa® debit cards are accepted. Resources Mentioned: Mike’s Book Profit First: https://mikemichalowicz.com/profit-first/ Profit First Instant Assessment: https://s3.amazonaws.com/ProfitFirst/PF-InstantAssessment.pdf  LinkedIn Secrets Masterclass, Have Job Security For Life: Use code ‘podcast’ for 30% off at yapmedia.io/course. More About Young and Profiting Download Transcripts - youngandprofiting.com   Get Sponsorship Deals - youngandprofiting.com/sponsorships Leave a Review - ratethispodcast.com/yap Watch Videos - youtube.com/c/YoungandProfiting Follow Hala Taha LinkedIn - linkedin.com/in/htaha/ Instagram - instagram.com/yapwithhala/ TikTok - tiktok.com/@yapwithhala Twitter - twitter.com/yapwithhala Learn more about YAP Media Agency Services - yapmedia.io/ **Relay is a financial technology company, not an FDIC-insured bank. Banking services and FDIC insurance are provided through Evolve Bank & Trust and Thread Bank; Members FDIC. The Relay Visa® Debit Card is issued by Thread Bank pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa® debit cards are accepted.** Learn more about your ad choices. Visit megaphone.fm/adchoices

At public mobile, we do things differently. From our subscription phone plans to throwing a big sale right now when no one else is. Well, maybe they are, but who cares, our sale is better. And it's on right now, no waiting necessary. You have the latest phone, now take advantage of a great price on a 5G subscription phone plan. It's the perfect deal for anyone who could use some savings right now. Subscribe today at publicmobile.ca. Different is calling. I was doing at Kino two days ago.

I asked Joanne and said, why did you start a business? And they all shared the same two reasons. I hear all the time. I started my business for financial freedom and I started for personal freedom. I said, who's experiencing that in this room? And there was the 1500 people in the room. I would say six hands went up. We all this dream of financial freedom and personal freedom.

And none of us have it. Most businesses are so financially strapped that you have to work your ass off just to get through the day. As a resource expands its availability, the more time we have, for example, the more we consume. It's true for money, and that's why so many businesses, as they see their sales increasing and revenue increasing over time, they get really excited, but almost uncannily, expenses are increasing at the exact same rate.

Well, that's a natural human response. It's a subconscious response, so we don't even realize we're doing it. But more cash means I have more to spend, and we keep on spending. To reverse this trend, we simply need to take profit first. Profit is not an event, meaning eventuality. Profit is a habit. What if I told you you could implement a cash management system today that guarantees profitability, automatically sets aside money for tax season, and ensures you don't overspend on expenses?

Well, that's exactly what you're going gonna learn in this business finance masterclass. Today, I'm joined by Mike McCallowitz to break down profit first, the cash management system that has helped hundreds of thousands of small business owners increase their profits or generate a profit from day one. Enjoy. I'd love to dive right into the topic of today.

You've got a classic business book. It's called Profit First. It was released in 2014. And since then, it has totally taken the business world by storm with hundreds of thousands of businesses using your method to drive profits. And fast forward nearly a decade after its release. I still have many extremely successful entrepreneurs who come on my show and they reference your books.

So we've mentioned your name several times on the podcast since you came on and episode 52. And there's so many businesses that handle their cash management using your system. In fact, my company Yat Media uses your system for accounting. And it's actually considered a Bible at Yat Media in terms of our cash management. So let's start off with a basic question. Why do you believe profits come first in a business? Well, because it is human nature when something comes first is prioritized and when something comes last, it's ignored or it's the manana syndrome. And so, you know, do I use Hala is imagine you love your family, which I know you do. And you imagine

saying, I love my family so much, I decided to put them last. I mean, it's absurd. I love them so much. I put my first, I put my health first. Things are important come first. And why I noticed was studying the standard formula, the gap that you only accepted principle for counting is that profit comes last. And it's called the bottom line in the year end. And execution, what this means, and maybe it's a subconscious response, but most entrepreneurs wait until the end of the year, you know, is April 15th now and they're like, I don't have any profit maybe next year. So profit is only considered at the end of the year and we fail to get it, we wait until the next year. Why teach them profit first is that profit comes out of every transaction.

So profit is not an event meaning eventuality. Profit is a habit. I'm going to dig deeper on all of these things. Let's first start about the traditional formula. So it's usually salesmuch as you can, take away your expenses, and then the rest is your profit. But you say this doesn't work because like you just said, it goes against human instincts. Because if we are saying that profit comes last, we're going to think of it last. We're not going to think of it first. So talk to about the Parkinson's Law and the primacy effect and how that actually impacts us from being able to use the traditional method and get our profits. Did you research?

Of course I did, Michael. I love it. Those two things are such important behavioral components. So Parkinson, quick history lesson, he's a theorist from the 1950s studying human behavior and finds an interesting phenomena. As a resource expands its availability, the more time we have, for example, the more we consume. So if you and I are discussing an agreement, I say, I'll get to you in one week, it'll likely take me a week. If you and I discuss the same agreement, the same people, the same parameters, by say, I'll get to you in one day, I'll likely get to you in one day. So as we constrain

a resource, we become more efficient. It's true for time. It's also true for food. The more food put in front of us, the more we consume. And it's true for money. And that's why so many businesses, as they see their sales increasing and revenue increasing over time, they get really excited,

but almost uncannily expenses are increasing at the exact same rate. Well, that's a natural human response. There's some constant response, so we don't even realize we're doing it. But more cash means I have more to spend, we keep on spending. So most businesses get stuck in this loop

of constantly trying to sell their way to profitability and success, and they never will get there, because of Parkinson's law. Now, the primacy effect means the next thing we see has a heightened importance. So as money comes in, those deposits come in, we look at it and say, oh, I got some money.

Finally, I can do, and whatever that do is, is the next important thing. We need to get new technology, we need to hire that employee, and we complete the account immediately. So those two things in that scenario work against us. By taking our profit first, when sales comes in, we take a predetermined percentage of that money

as revenue and remove it away, it constrains the supply of cash. Now, Parkinson's law becomes our ally. It's like, oh, I don't have $10,000 deposits. I only have $6,000 available to operate my business. And we constrain and control our spending around that. And that $4,000 has been reserved for profitability. Something else that you teased out is that taking out profits is not an event.

It should be habits. So, can you talk to us about how we can actually make this more of a habit rather than thinking about taking our profits out five years down the line? I think we look at profit in chunks by default. Like, oh, you know, if I get one more client or I get the big sale, finally we're gonna chunk a profit. But the reality is, profit is something that means needs to be a habit or habitual.

We build that. It's kind of like saying, I'm going to go transform my body by going to the gym one time and work out like an animal, and I'm going to come out with a perfect body. We know that to have transformational effects on our body, we need to exercise regularly for a sustained and perpetual period. Well, this is true for the viscule body, if you will, of the business. It rarely, really happens that you have that huge client and all that money comes in,

and now you can reserve it and sit back and go on easy street. What we need to do is every transaction, every time there's a deposit, a predetermined percentage, goes to our profit. What happens is we start reverse engineering profit. If I want my company to have a 20% bottom line profit, and I get $1,000, I know 20% is 200 dollars, 200 dollars is hidden away and now I'm reverse engineering that profitability. I've 800 left. That's why I have to work with

to run my business. It becomes this habitual reverse engineering of profitability and it assures profitability. You will always be profitable because you took your profit first. And this is really important, guys, because this is actually how you build financial freedom as a business owner and entrepreneurs, why you got into entrepreneurship. And the first way, it's you didn't get into entrepreneurship to build a job for yourself. We're just on a hamster wheel. This actually allows you to get rewarded, pull out money from your business, and build financial freedom. You know, I was doing a keynote two days ago. I just got back and the large audience night asked, you're in to say, why did you start a business?

And they all shared the same two reasons. And I hear all the time. I started my business for financial freedom. I don't want to worry about bills and I started for personal freedom. I want to do what I want when I want. I said, who's experiencing that in this room? And there was the 1500 people in the room.

I would say six hands went up. No one's experiencing. We all this dream of financial freedom and personal freedom and none of us have it. It's the room. I would say six hands went up. No one's experiencing. We all this dream of financial freedom and personal freedom. And none of us have it. It's the reverse. Most businesses are so financially strapped that you have to work your ass off just to get through the day. To reverse this trend, we simply need to take profit first. And by the way, this is nothing new. It's new to business, but the belief of the pay yourself first principle has been around forever. So I simply took an established concept in personal finance, pay for your retirement first, reserve for your savings first, live off the remainder, simply apply it to business

and it works. It does work. This is why hundreds of thousands of businesses use it. So at the end of the day, profit first is really a cash management system. And one of the most innovative parts is the fact that you say you actually need to split up your bank accounts into smaller chunks. And this is something that we've actually adopted at yet media. We love it. It's really helped improve the things that we do in terms of the transformation before we were doing this to after. These things are running a lot smoother

and peace of mind as a business owner for myself as well knowing we have like money for taxes, money for this is like I'm not constantly worrying about stuff. So for people who are unfamiliar, what is the advantage of actually taking all your money and splitting it up into different accounts? And then we can get into the types of accounts and everything.

Sure, sure. So the technical definition of this process is called fund preallocation. Meaning we're taking money and assigning it a responsibility before we spend the money. So the concept is we set multiple accounts at your bank and I got to score this a million times. That is fundamentally the key.

We do this at your bank because it's a behavioral intercept. So most entrepreneurs manage their business by logging to a bank account. We have accounting statements, but we don't read those. We have a simpler system for most of us. Logging into the bank account and see what we have and spend accordingly. By having multiple accounts at the bank, determined or designated for different responsibilities, we know what that money is intended for, and it will, before we spend it, we know how to spend it. And that's the key. Now, the reality is for most entrepreneurs, if they don't have profit first,

is they have a single primary checking account. They're banked. They have another one for payroll or something, but they have one or two bank accounts. What happens is all the funds go in there and they pay all the bills from it. And what I equate this to is imagine Thanksgiving dinner and you cook a turkey or something. And then instead of carving up the turkey, you say to the guest, everyone fight for it. Whoever wants it most wins. Everyone for themselves.

And that's absurd. We instead carved a turkey so everyone can get a piece of turkey on their plate. Well, the same thing is with our business. If you've won serving tray of cash and you tell your business, whatever needs it next, we got to need to hire when you computer technology, fight for it, they will consume the whole turkey and the rest of the business will starve to death. So what we're doing in this system is we're setting up plates for every guest at the business table, which we have always different accounts for. We carve it up and that way everyone entire business is fed and healthy. Awesome. So speaking of these plates, there's really five

plates or five accounts that's main income profits, owner salary, taxes, and operating expenses. So I think my listeners are really smart. All of these seem decently straightforward, except for profits and owner salary. What's the exact difference between those two? Because especially for a solar preridory, you might think profits is the same thing as your salary. It's an honest comp and it's not. Yeah. So profit is a reward for taking the risk of starting a business. Here's the scary statistics. Only 17% of the population will ever take the risk of starting an operating business. And only 20% will do it successfully for at least

five years. So that means 20% times 17%, which is roughly 3%. Only 3% of the world population will ever run a successful business. 97% of the population is looking to work for a successful business. Our job as entrepreneurs is to be a creator of jobs. And the profit account is a reward. As a thank you, we're taking on this risk. That only 3% of the people ever pull off. So just like if you invest in private stock, I have, or public stock, I own some Ford stock. Ford sent out a distribution, check, profit distribution.

I don't run to the Ford factory and say, oh, I got to earn this now. And I definitely don't return it to him and say, oh, it's a plowback, let's go for it. I say, I take a risk, I want the value to increase, but it could decrease. This is a reward for doing what almost no one else will do. Our business, we hope the value will increase over time, but we've taken the risk, it may collapse. Profit is a thank you for supporting our global economy.

Now, owner salary or owner's compensation is the pay for the work you do within your business. So, most small business owners work within their business. And if, if I had to replace you, I suspect you're the best salesperson for your organization, you're the best spokesperson, you're the most knowledgeable, you work your tail off of this business, what would I have to pay a person to replace you? To do the same thing. $100,000, $2 million, it's a big freaking number, that's all I know. Well, that's the number you deserve to make

because your company found you. It has you. So your company must pay you. And if it doesn't pay you appropriately for what you're doing, it's a matter of time before you resent it. Most business owners say, ah, screw my salary, I gotta pay everyone else.

And years later, like I hate my company. I am starving here. So owner salary is to pay you for the work you do. This is what your lifestyle should be adjusted to. Profit is the bonus for taking on risk that almost no one will do. So again, the five buckets are main income, profits, owners comp, taxes, operating expenses,

and we have to put percentages for each one of them. So why don't we start with profits? How do we determine the ideal percentage that we should allocate towards profits? So what I did, and I'm not trying to be pitchy here, it's in my book, but you can get online for free. I, in my team, analyze a thousand businesses in all different industries, media industry, restaurants, manufacturing, professional services.

We found that there is a percentage that the physically elite, the best performing companies in any industry will do. Now, it's based upon different revenue ranges. So a smaller business, say you're a brand new startup, you make 250,000 or less in revenue, which in the service industry is typically a single person operation. If that is your case, you will probably take a diminished

profit of maybe 10%, you'll take an expanded percentage of owner salary, maybe 50%, you'll reserve 15 for tax. The tax account in business is your business can reserve your tax liabilities and responsibilities regardless of your formation. So you can have an LLC or a sole proprietorship or an S-Core and your business can pay your taxes and talk with a tax professional how you distribute it is unique and different in each case. But the percentage will change.

So once you hit a million dollars, you're not putting 50% toward profit or owner's compensation where you take a $500,000 salary, it may be reduced. Maybe now it's 20%. Once you get to a 10 million dollar company, maybe the owner's compensation is 10% went about a million dollars a year. So the percentage is adjusted. What I suggest people do is look at the resources, what we analyze, but don't necessarily start there.

If you're an established business, a target is simply where we're headed. You have what we call caps or current allocation percentages. This is your starting point. If your business has never paid a profit before, and we're suggesting you can get to 20% in profit, let's not start there. Let's start next month by going to 1%.

And after quarter, let's go to 2% and 3%. Maybe the rollout takes us a couple of years to get that 20%, or it allows your business time to digest and three percent. Maybe the rollout takes us a couple of years to get that 20 percent, or it allows your business time to digest and adjust to the taps that we're targeting. I've got to say, guys, implementing profit first into my business was a night and day difference.

The clarity I have about our financials, how much profit we're generating, how much money we've set aside for tax, how much we can spend on expenses. It's given me so much peace of mind that I've never experienced before as a business owner. And that's why I'm so excited to have partnered with Relay. Relay is an online banking and money management platform that is the official banking partner of Profit First. With Relay, business owners can create up to 20 individual accounts and automate their profit first allocations so that when money

comes into your income account, it automatically then gets distributed to your other accounts based on the percentages you've set up The best part is especially if you're trying to follow the profit first methodology and you have to set up all these different accounts There's no account fees. There's no overdraft fees no minimum balances and you can make unlimited payments via ACH wires or bank checks They also have great integrations for syn with accounting softwares like QuickBooks, which we use at YAP Media and Zero. If you're a small business owner, you need banking that is truly built for your business. If you have even the slightest interest in profit first or if you simply want a banking

solution that was designed specifically for the needs of small business owners, I highly recommend Relay. It's easy to apply online and it's absolutely free. You can sign up today by visiting RelayFI.com slash profiting. Again, that's RelayFI.com slash profiting and the link is in our show notes. Give them a try, I hope you do. I love that and I want to kind of dive deeper on that point.

So you're saying, take baby steps, just start off with saying, all right, I'm going to allocate 1% to profit, 2%. At the same time, we should be reducing our operating expenses by the same amount, right? So explain to us why we should do that. Yeah, that's the kind of the, how the equation works is when you take a percentage away for, or add it to something, you gotta take it away from something else. So in most cases, not all, but in most cases,

we will compress operating expenses. What our research has found, and we have over 700,000 companies have deployed profit first to give context, most businesses run far too rich in operating expenses. They're spending upwards of 95% of inbound income was right back out the door to operating expenses, and it's a meager amount left for the owner.

What we also found is that the spending is kind of aimless. It's just like, oh, I heard we should be running Facebook ads because other people told me I'll do this and I'll do that. And there's no concentrated effort in a certain area. What's interesting is we start constraining the operating expenses. So we allocate more to our profit. So forth, reduce that op-ex from 95% to 90% and then 80% and so forth. That the business owner, their behavioral response is interesting. It doesn't reduce the impact that the business is having. And say what does is requires them to focus more on what is having impact and they make bets onto the sure things. So instead of just randomly testing stuff,

you say, you know what, we've had success here. Let's do more of that. Or let's bring an expert that can tell us actually how to do Facebook ads so we just don't blow money out the window. And they start becoming more focused. The greatest surprise for me, I never expected this, is businesses that deploy profit first and reduce their operating expenses

in the vast majority cases grow faster than their contemporaries who aren't doing profit first. Which I'm saying is, most profitable companies grow faster than unprofitable or checked by check surviving companies. So it's interesting, do you think it takes money to make money? It's what we've been told,

you need to spend as much as you can, and that's not the truth. You need to be innovative as much as possible. And when you control and constrain op-ex, you become more innovative, more prudent than how you spend that money. I think that everybody could look at their operating expenses right now and find

one to five percent of like quick things that you can do to just streamline things, reduce your costs, and then allocate that towards profitability, and so it could be just cutting software so you don't use anymore, looking at user seats on all your different platforms and realizing that you're paying for ten seats that you don't use, and just

little things like that. So, so I started investing in companies again and we just invested in a social media company and the first thing we did is exactly said we said, where is that? We said 10% and we said, where is the 10% we can cut and we did it within a month and the business has gone on unabated and there was no damage or nothing. It's like, oh, we had a subscription that we thought we were using but we realized we weren't. There's so much of this stuff that is just being spent automatically

that we were cutting, we were able to cut it, and we all went to profit immediately. We brought cash stability to a business within a month just by cutting unexpected or unnecessary costs. How about debt? What do we do if we have some debt that we need to pay off? How do you suggest that we handle that?

The only way to handle debt is by being profitable is the first thing to understand. Because when I present on this, people come up and say, I've debt, I can't be profitable yet. I'm like, oh, you have to be. So just a real simple definition. Debt is an expense you incurred in the past that you couldn't afford or chose not to afford,

but you've used other people's money. The only way to pay this is that you make more money than you're spending right now profit so that you can pay this back. It's the residual leftover that you can use to pay it back. So you have to be profitable. So step one is if you have debt, you have to implement profit first.

You still out-cate money to a profit. But the tweak is until this debt's away, when the profit distributions come out, we use a large portion of it, sometimes upwards of 95% of that distribution to eradicate debt. I'm not a fan of having debt. I'm a fan of self-funding.

That's the position I put my companies in, is that we have debt, we first get rid of it, and then we allow cash to accumulate an evolved account so that we have runway, and we can be a bank to ourselves if we have to be. Really great advice. So let's talk about the two buckets or accounts that we should never touch, which is profits and cash. Yeah, never really touched. It's effort quarterly. So it's an account that sits aside. So what happens is as we allocate my intraprofit,

if we leave it at your active business accounts, it can come, become very tempting. They bills come in, like I can't pay these bills. Oh, I have some profit money. I'll take from there. But the day you do this, this becomes a shell game. And now you don't have profit, it's an expense. And you just pretended you had profit. So we're going to do is when profit gets allocated, we're actually going to hide that away too. Taxes, the same symptom

can happen. Only is it take from the tax money. No, no, that's for the government. Let's hide that away. So we set that up as separate bank. Now, we do touch it once a quarter, and there's a reason behind this. Everything I'm teaching in profit first is a behavioral based, there's a behavioral based justification behind it. And the 90-day thing, where there's an interesting phenomena around 90 days. 90 days is far enough out that you have to make effort to get there, but it's close enough that you can anticipate it. It is pretty imminent. So it's a good rhythm. If you took profit once a year, it's so long out people don't even think about it. But since every 90 days is just around the corner, we keep on pushing toward it. Oh my gosh, can we be more profitable? So builds our energy

around it. And this isn't just a behavioral principle that I'm suggesting. All major public corporations do 90-day profit distributions, or the majority do. Forward, every quarter sends out their profit distribution, and you'll see that with most public companies. They know the number one fiscal discipline is engagement of the shareholders shareholders excited if you reward them every 90 days That's the highest level of engagement and virtually you think well honest take out profit every week I'll get really excited no then it becomes precedent and expectation. Oh, this is my new life standard So 90 days is far enough out that we're anticipating it, but we can't get our hands on it right away So hide that money away the tax same thing every 90 days is when tax quarterly is our due and that's when the money comes out. You

can make your quarterly payments. These are your personal taxes, your business can pay your personal taxes. Again, off-line accounting professionals, sometimes they can't pay it directly. You may have to reimburse you, but there's ways to do it. But that tax account is the same thing. We want it out of sight out of mind. And when distribution day comes every 90 days, we do it in the calendar. That's when it comes out. We reward ourselves with profit, and we pair tax spill through the business.

I remember at Yat Media, before we implemented profit first, our first year in business, we were hit with such a big tax spill that we weren't expecting. And it really hurt us, you know, like just cash flow-wise. Got plenty.

Now, you know, taxes are on the corner. I'm like, ah, we're candle that, you know? This is the craziest thing. I'm really blessed. I get an email every 15, 20 minutes now from readers of profit first and my other books, but profit first predominantly. The number one busiest day of emails and I'll get one every minute or so is on tax day. So in the US April 15th, it's unbelievable. How many people say I just pay my taxes. My businesses pay my taxes for me. I'm so excited. I thought people will be so excited about

profitability and they are, but never having to worry about taxes again. And that bill that can just shock you. Having your business already counted for it seems to be like the biggest relief for people. Like I said, I actually used profit first in my business at Yapp Media. It was not easy to find to be the biggest relief for people. Like I said, I actually used profit first in my business at YAP Media. It was not easy to find a bank that would allow us to have multiple checking accounts without a bunch of fees. The interfaces for these banks weren't great, and it was kind of tedious to do all the transfers.

But we really wanted to implement the profit first method because we wanted the transparency, and I'm sure a lot of my entrepreneurial listeners can relate. So I wanted to find a new bank that would allow me to create multiple accounts without a lot of extra fees that would allow me to implement profit first with ease. And that's when Mike told me about relay. Are there banks where it's free to just have as many accounts you want? My favorite bank hands down is called Relay. And what's so interesting about relay is they've become certified in profit first. So you can go to Relay Bank.

It'll say, do you want to set profit first account? And you click, yes, and it goes, it rolls them out. It's a no charge, no fee bank. And it'll even do now automatic allocations. So you can say 10% to profit, 15% here. And you say, and it starts doing the allocations for you. So they're a great bank.

Awesome. All right, so the last two questions that we ask on the show is what is one actionable thing our young and profitors can do today to become more profitable tomorrow? Real simple, only set one account. So we talked about the foundational five. You can do this in your personal finances

or your business, you choose, but call your bank and set one additional account and call it profit. Then any money that comes into your personal account or any money that comes into your business account, take one percent of it and move it into this profit account. The reason we do 1% is so small is it's not going to negatively impact your lifestyle or your business lifestyle.

But it's going to have a very positive impact on your mindset because you'll start seeing cash accumulating. When you see that this can work at such a small level, it's just a matter of time before you get momentum and expand it out. That's great. And what is your secret to profiting in life? And this could be relationships, financial, however you want to think of profiting? It's fine. One of the secrets, I guess, is there something I discovered in the last year or so? And I've really been practicing this. I meditate every morning and I have a ritualized morning. And one thing I ask myself,

I've stopped asking, will I be successful in life? I've been asking why matter in this life? Why take my final breath and it's a planet, I don't know if people will say, oh, he was successful as much as Mike mattered. I think that's the more important thing that that's what people remember. So I ask myself every morning,

am I gonna do something today that matters? And that has changed my trajectory and actually brought more energy to being of support to my fellow humankind. I love that, that's so beautiful. Michael, it was such a pleasure to have you on the show. You are so smart and this was one of the most actionable no fluff podcasts that I've had in a while.

So I really enjoyed it. That's my goal at Young & Profiting to be actionable. I think people are gonna be taking a book worth of notes. So thank you so much for your time. This has been a joy, Hala, as always. Thank you. Thank you. you