Murphy’s Law

Murphy’s Law is a popular adage that states that “things will go wrong in any given situation, if you give them a chance,” or more commonly, “whatever can go wrong, will go wrong.”

Murphy’s Law and Your Business

If you have been in business more than five minutes you probably know that Murphy’s Law is alive and well. It not only applies to you personally but to your business. Unfortunately most people do not prepare for things that can go wrong or want to believe that it won’t happen to them. At the time of this writing the world is going through a Coronavirus and there are literally millions of businesses going out of business because they failed to plan for Murphy’s law. In America I also think we may have a false since of security hoping that the government will bail us out when Murphy’s law effects us.

Preparing for Murphy’s Law

When I was in the financial planning business we told our clients the first thing they need to do was work on creating an emergency savings account that they could use when Murphy’s law because it is not if it happens it is when it happens. The typical account should have at least three months of savings that will cover you during a crisis or situation until you can get back to your normal. I would suggest this should be done for your business as well.

How To Prepare

If you are a solo entrepreneur or a business with employees there are two major things you can do to protect yourself and your business against Murphy’s Law. If you can afford insurance purchase enough to cover you and your business for at least three months of income for survival. If you can’t afford insurance start an account to self insure and DO NOT TOUCH IT for anything that is not an emergency!

“I can’t afford to save for “Murphy’s Law” I don’t know how many times I heard this as a financial planner. The fact is most everyone that has a job or has a business spends money on things that they don’t need. In other words they are living above their means. They also are using credit cards for their emergency fund. In reality this is like digging a whole and the credit card company is throwing you another shovel! They also are paying too much for products and services where they could be saving for Murphy’s Law. I understand that you may want the best phone, newest car, greatest home or apartment, nicest close, coffee at Starbucks, etc, etc, and you should have a goal of having these things once you have protected yourself and your business against Murphy’s Law. Even if you need to start your savings with change from your pocket everyday in a jar it is a start. If this is where you are you should also take an accounting of where you spend money and see where you could save until you have three plus months of savings. You will be surprised if you shop your current services, insurance, products and other areas that could save you money. If you are struggling in your business you may need to reevaluate your business to make sure it is viable to provide the success you want or need. You can also get a side gig or part time job to make enough to fund your emergency fund and also to help fund your business. I recommend this to anyone who wants to fund a business that was created out of passion vs financial success.

Why Is This Important ?

I don’t know about you but I like to sleep at night! When you don’t have to worry about when and if Murphy’s Law hits (and it will!) you will sleep better, be more secure in your personal and business life. It also puts you in the minority of having to rely on family, charity or the government to bail you out even if that is possible. If you would like more information about this you may contact me for a free consultation I wish you success in your business!

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