Strength in Numbers with Marcus Crigler

Episode 69: Why So Many High-Income Entrepreneurs Still End Up Broke (and How to Fix That)

• Marcus Crigler • Episode 69

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0:00 | 23:17

Why do so many business owners still struggle financially even while making good money?

For today's episode of the Strength in Numbers podcast, Marcus Crigler answers this question while he shares practical advice on bookkeeping, cash flow, hiring, forecasting, and building long-term wealth the right way.

He also explains why financial systems matter and how small mistakes in money management can quietly destroy a growing business.

Listen and enjoy!

You’ll Learn How To:

  • Build a financial system that supports business growth
  • Use bookkeeping to make smarter decisions
  • Forecast cash flow and plan financially
  • Avoid common money mistakes high-income entrepreneurs make

What You’ll Learn in This Episode:

(02:19) The real foundation of a successful business is your books and records

(03:07) The biggest mistake bunch of coaches make in their books

(04:43) The “three-box” wealth-building system

(05:27) Magic in building wealth

(06:50) The importance of forecasting

(09:29) The “3X Rule” to hire safely

(11:25) Reserves matter more than most entrepreneurs realize

(13:31) The importance of accountability even when the business is doing well

(14:17) How to attract clients on a day-to-day basis?

(17:15) The financial systems entrepreneurs need before scaling

(18:19) Marcus’ biggest takeaway from the Coaching Inc event

(20:26) Entrepreneurship can feel lonely without the right community

(22:06) Connect with Marcus Crigler

Who This Episode is For:

  • Real estate entrepreneurs who want to scale
  • Entrepreneurs scaling past inconsistent income
  • Business owners who are struggling with financial systems

Why You Should Listen:

This episode is a strong reminder that making more money doesn’t automatically solve financial problems. Marcus explains why systems, reserves, forecasting, and discipline matter just as much as revenue growth.

Connect with Marcus Crigler:

SPEAKER_01

But the real foundation of everything you do in business is your books and records. If you've got all the revenue in the world, but you don't know where it's at or what it's doing, it doesn't matter. It doesn't matter. You're gonna go broke. And I've seen it enough times that if you're not tracking your stuff, you can't outrevene that.

SPEAKER_00

Welcome to Strength in Numbers, the podcast for real estate entrepreneurs who are tired of being broke and not having control of their finances. If you're ready to finally take control of your money, last your taxes, and start building real wealth, you're in the right place. And now here's your host, Marcus Krigler.

SPEAKER_02

What's going on? What's going on? It's your boy, StorytellerJet, and we are live right now at Coaching Inc. in Orlando for our meeting here. And it's been a fantastic couple of days. Incredible. Uh the presentations were invaluable. The time that we got to connect afterwards, too, fantastic. Last night I got the opportunity to hang out with Marcus over here. And um, I guess like my favorite thing for last night was uh when he brought like you know that my tie for me, which was incredible. So bam, extra special Mai Thai. It was so good, man. It was so good. It was one of the best my ties I've ever had.

SPEAKER_01

Well, you know, I told the bartender, I said, listen, my buddy wants this my tie, and it better be one of the best ones you get.

SPEAKER_02

Okay. Yeah, that was awesome. But yeah, that's what I love about like an organizations like this, Coaching Ank, when people come together, break bread together, and learn together and grow together. Right. Yeah, it's incredible. So let's get started by doing a quick introduction of who you are, Marcus, and um, we'll dev into the conversation today.

SPEAKER_01

Yeah, sure. So Marcus Krigler, founder and CEO of Beck CFO and CPA. I work with real estate entrepreneurs across the country, helping them make money, save money, and build real wealth in real estate through our accounting firm. So we kind of take an approach of how do you actually make an impact on somebody's life as an accountant? And we do that again through trying to save them a bunch of money in taxes and help them understand where they're at and how to make more money along the way.

SPEAKER_02

This is awesome. I love that. Well, there's like, again, I know we probably would need like five hours to really uh unpack what you just said over here. But what are some quick ways that you help investors like save money or coaches save money?

SPEAKER_01

Yeah. Well, so I think the first thing and the foundation of everything that you do in business, right? And and a lot of people don't realize this because everybody thinks revenue is the name of the game. But the real foundation of everything you do in business is your books and records. If you got all the revenue in the world, but you don't know where it's at or what it's doing, it doesn't matter. Doesn't matter. You're gonna go broke. And I've seen it enough times that if you're not tracking your stuff, you can't outrevenue that, right? And so one of the big things that if you want to save money, make more money, build wealth, doesn't really matter. It all starts with getting good bookkeeping, good books and records, good analysis of that information so that you can go make decisions on it, right? Um, somebody did a presentation yesterday and put the quote up there that what doesn't get measured doesn't get results, right? And so that's what we believe in all the time is if you want results, you have to be able to measure it. And and in business, measuring it starts with bookkeeping.

SPEAKER_02

Yeah, yeah. What is the biggest mistake that you see a bunch of the coaches making out there as it relates to their books?

SPEAKER_01

Yeah, I I think I think the big thing that I see people just making mistakes is not giving their books the time of day, right? So there's a lot of great entrepreneurs out there that have realized that, hey, I know I need to get my books done, but like I don't ever look at them. I don't know what they mean. I don't know what it tells me. And so where I think a lot of people make the mistake is they get part one right, you know, they get the foundation, okay, we're gonna, we're gonna get our bookkeeping done. I'm gonna hire a bookkeeper, I'm gonna, you know, whatever that looks like, but then they don't ever look at it or they don't put a dashboard together to understand what it means. They don't look at the trends, they don't see, you know, all of the variables of the data, they're not looking at it. So such a big piece of the puzzle is just taking that data and then reorganizing it to something that you understand as a coach. You're not a financial person, right? Most of the coaches, most of the real estate entrepreneurs, they're not finance people. So we've got to put it into a way where your skill set of whatever that is can understand the data so that you can go make better decisions again to make more money, save more money, and build wealth.

SPEAKER_02

Yeah. So you just talked about like, you know, how you've helped people save money. So, how do you help people build wealth as an accountant?

SPEAKER_01

Yeah, it's a really good question. So, what we like to do is, well, we always start with how to how to build wealth, right? There's a process for this. And some people do it accidentally, some people do it on purpose. The ones that do it on purpose do it a lot faster. Okay. So wealth is all about kind of these three boxes. Okay. You have your business, right? A lot of coaches, a lot of real estate entrepreneurs, that's their business. They've got their personal box. This is where they, you know, you're buying your groceries, you're paying for your house, you're paying for all this other stuff. But then you've got your investment box. And so what happens in business, and this is kind of how people really figure it out, is they start at their business and their business takes care of their personal life, right? Like business is making money, it goes to pay my personal life, my personal expenses, all that good stuff. But then eventually we get to a spot where the business is making more money than my personal life needs. Now we can divert some of that to this investment bucket. Now, here's where the magic is the magic in building wealth is that once money goes into the investment bucket, it never comes back out. Not until you're done with your business. So you start, okay, life's good. I'm I'm paying myself every single month a good salary. I'm making good money. I'm putting some extra in my investment bucket. That investment bucket is churning, right? So every time that you make money, you're reinvesting it over and over again. And it allows you to have compounding on your investments. So now I always I always like to make the joke, your money's making money, right? You're you're making baby monies, right? And so they're uh, you know, doing what money does and making baby monies for you. And that's where the wealth is made. But most people miss this part. You do not take money from your investment box to your personal box until you're done with business. This investment box is what's gonna pay you for the rest of your life. And so you've got the business, you're working for that. Take the money from your business, and if it's not enough, work harder, right? That's the answer. Don't take it from your investment bucket because your investment bucket is gonna be there when you really need it, when you don't want to work, when you can't work, when you're tired, you're exhausted, whatever it looks like. We all get there at some point in our life, right? So your investment bucket is the one that's gonna solve that problem for you.

SPEAKER_02

Boom. I love that. Absolutely love that. So you work with a lot of investors and coaches. Yep. What is the common thread? What is the common issues that you see that most of those guys are dealing with on a day-to-day as it relates to their financial world?

SPEAKER_01

Oh man, I there's so many different issues that you can see in these industries, right? But it really comes back down to predicting the future. You know, if you want to hire somebody, you want to kind of get an understanding of how much are they gonna cost me and then when am I gonna recoup some of that money back, right? For we're gonna add another marketing channel. How much am I gonna spend on this marketing channel? How much time do I invest for us to see our OI on that? So a lot of it comes down to not looking at what decisions you're making into the future, right? So, you know, a lot of the times we're discussing, having conversations, we're talking about what is it that you're doing in your business that is going to impact next month, the next month, the next month. And instead, a lot of people are looking at like historically, like, okay, what did we do? Really, really what you want to do is start thinking about what you are going to do, 30, 60, 90 day forecast, right? Thinking about where the cash flow is going to be at in 90 days from now. Because if you can get an accurate projection of that, now you can start making really good decisions for today. Because if it's a lot more money than you care to have, you might change your decisions on how you're doing it. You might reinvest in some other things over the next 90 days. If it's a lot less, you might have to pull back a little bit. You might have to not make that higher. You might have to, you know, cut a couple of expenses. But a lot of people make the mistake of always looking historically. What did we do versus looking into the future? I kind of call this hindsight versus insight. Hindsight's historic. Insight is into the future. That's kind of your CFO type thinking, right? And so that's where you've got to kind of spend your time. If you're a coach, if you're a real estate entrepreneur, thinking about how or where my business is going to be from a financial standpoint in 30, 60, 90 days at any given time, that's really the where the magic starts to come in.

SPEAKER_02

I love that. I'm going to ask you a follow-up. I guess Ipot, I can never pronounce that uh words because of my super sexy accent. Hypothetical. Hypothetical, yeah. Yeah, I'm gonna ask you an hypothetical question as a follow-up to one of the things that you just shared right now. So hiring. Yep. So when is the right time to hire? Yep. Meaning, like, let's say, like, you know, it's a new business, like new coaching business that's just kind of got started. They definitely need to hire to continue to grow their business. On the financial world, like their finances, when do they know that they are ready to hire that person? So let's say they're hiring somebody for 100 grand, but they have like 100 grand in their business now. Is it the right time to hire? Or like, you know, what financial looking at their finances, like when is the right time for them to do the hire?

SPEAKER_01

Yeah. And I'll even take it another level to add a significant expense, hiring big marketing. We're not talking about, you know, adding Adobe subscription. You know, we're talking about the big things, right? I have what's called the 3x rule, which means if you do not have three times that expense already accounted for in your reserves, you're not ready for it. That means what you're currently doing today has not allowed you to stack up enough cash to pay for that next thing, right? And so what a lot of people make the mistake of is, and let me clarify this 3x rule here, because I I could have skipped over that. So my big belief in is any healthy business has three times their expenses and reserves, at least at a minimum. Any healthy business needs to have that. And so let's say your you know expenses are $100,000 a month. You need to have $300,000 in the bank. Okay. Well, you want to go hire that $100,000 employee. We got to have three times their salary into the business, but not their full salary. It's only three months worth of salary. That's three X, right? So that gives them three months of time to figure out if it's working or not, right? But you've got to put that in the bank first. So that you know, let's call it $10,000 a month. You needed to save up an extra 30 grand, put it in. Now you got 330, you can hire that person. You're staying at the 3x rule because you've stayed at, you know, three times your expenses. And now it's giving you runway to say, okay, well, at the end of this three months, if it didn't work out, I can make another move, right? And so anytime you make, and that's another thing that I tell people anytime that you make an investment in your business, that's what we're talking about. People, marketing, any of that kind of stuff, you got to give it 90 days. It's got to at least be a solid 90 days, and that's going to allow you to know is it working, is it not? You're gonna have enough historical insight, and then you'll have enough hindsight or or insight into uh where you're going from here to decide if we want to keep spending this money. Yeah. So it's all about reserves.

SPEAKER_02

Yeah. Why did you pick the three months instead of like six months instead of like, you know, a whole year?

SPEAKER_01

Yeah. So three months is where we like to start. We like to get up to six months as we're growing our business. But 12 months, I believe, is too much for most businesses because of just the cost of that capital. Now, there are plenty of businesses where 12 months should be the right number. But for most businesses that we work with, that three to six months keeps them plenty reserved, keeps them operating at a high level, and allows them, if there is a hiccup, to recover pretty quickly. Because the reality is this if you have six months worth of capital, that's probably actually going to give you a year, a year and a half worth of runway because you're gonna start cutting expenses, right? You're not gonna keep the exact same expenses. So while it sounds like six months just because of today's expenses, if the economy went bad, if something changed in your business, really you're probably gonna make that six months last a year, 18 months. And now you've got a lot of opportunity. Any good entrepreneur can reinvent themselves in 18 months, right? You can go from zero back to the top in 18 months if you're really focused on it.

SPEAKER_02

I love that. That's a huge takeaway that you just shared, like value bum and people watching this, you definitely need to consider that. Uh, because I think that was that was awesome, man. That was that was really cool. What is one practical things that you have changed or done over the past year in your business that has resulted in the biggest impact for you?

SPEAKER_01

Yeah, I think I think holding standards. I think holding standards within our our company is probably been the biggest impact. I think, you know, it we're we're very blessed. We've got a very successful business and have have been able to uh you know grow it drastically over the last half a decade or so. But with some of those successes comes a little bit of, I won't call it laziness, right? You just sometimes you turn the blind eye to things and then it takes too long and you I should have hold that held that accountability a lot earlier, right? And so what I've learned over the last year, and probably something that I'll continue to take with me as I continue to you know become a better entrepreneur, is making sure that even though things are good from a monetary standpoint doesn't mean that you don't hold accountability at a high level, right? And sometimes, you know, I see it with my clients, I've seen it with uh myself. It's easy when things are going good to not have you know that kind of that focus and that hardcore accountability when things are going bad. Everybody does that. Like, oh, you got to get here on time, you know, do, you know, show up to your meetings, go do your appointments, go do all these things. That's easy when things are rough. When things are good, owners, myself included, take their eye off the ball a little bit. So be careful, don't fall into that trap, keep your eye on the ball, and you'll have a lot of success.

SPEAKER_02

Yeah, absolutely. One of the questions that I've been asking everybody right now is how are they attracting clients for their business on a day-to-day basis? Or so what are some of the activities that you're doing to help you grow your business, attracting new clients? Sure.

SPEAKER_01

Yeah, we have a small social media presence that we do a lot of posting.

SPEAKER_02

By a small social media presence. He's one of the most inspirational persons that I know on the planet that is, you know, posting on social media. But sorry to cut you off, but appreciate you saying that.

SPEAKER_01

I appreciate it. Yes, I do like to post you know good advice that I, or at least I think is good advice on on Facebook and and other social media platforms. So we do that. We get a lot of referrals in in our industry. That's kind of the name of the game is referrals. And so yeah, we're we're just big word of mouth and just trying to put out value to people. We do a lot of podcasts, we do a lot of uh stage presentations, we do a lot of that kind of stuff and just get the word out about how here's at the end of the day, if you can figure out the financial side, first off, it doesn't matter what business you're in, the financial side is paid pretty much the same. It's all the same words, it's all the same, you know, pieces of the puzzle. But when you figure that piece of it out, you've just opened yourself up to this gateway of opportunity that you've never known before. And so if we can share that message of here's how you understand your financials, here's what it means, here's the 3x rule, here's the other 15 rules that we have of good business owners. If I can share that, then you know, some people will come with us, some people won't, the right ones will, the right ones won't. It's all good. You know, that's how we that's how we take it.

SPEAKER_02

Yeah, absolutely. For anybody that is sitting at like maybe five to 10K per month right now that wants to grow to 100K. Okay. What is the biggest advice that you would give them for them to grow their business to that level? Take your time.

SPEAKER_01

Take your time. Everybody hears the story of the person that went from 10,000 to 100,000 overnight. But that's not the most common story. It's just the loudest. The most common story is you went from 10,000 to 12,000 to 20,000 to 32,000. And you're creeping up along the way. And honestly, the great thing about that is it allows you to grow your skill set and your reserves along the way. And I know a lot of people are like, well, how would I not be making or adding reserves if I instantly turn to, you know, from 10,000 to 100,000? You know how much marketing you're gonna have to spend to go from 10,000 to 100,000 overnight? So much money. So we're talking about net. And if you want to net the most, I think it's a slow game. I think the ones that do it the best do it slow and steady and they win the race, right? It's tortoise in the hair.

SPEAKER_02

Yeah, I love that. So let me add to that question too. So we talked about, like, you know, what they can do to go from five, 10,000 to 100,000 a month. So now if somebody wants to go from five to 10 to 100,000, what is one thing that they should fix in their business to ensure that they get to that level?

SPEAKER_01

Oh, so again, I'm a finance guy. So I'm always gonna go back to numbers. And I think it always comes back down to if you don't have good books at 10,000, at 100,000, you're gonna really have bad books, right? If you don't have a good financial system at 10,000, you're gonna have a really bad financial system at 100,000. So one of the last places that scales in most business is their finance department. Most people, it's easy to scale marketing, it's easy to hire another person. What's not easy is to improve your financial department and make sure that what I'm doing today at 100,000, if that's really your goal to get to 100,000 a month, you've got the financial back end to do that, right? We all think about okay, I got the marketing back end to do it, but did you build the financial engine to do it? And a lot of people miss that one.

SPEAKER_02

Yeah, absolutely. So, right now we were live at Coaching Inc., it's been a fantastic couple of days, and we have one more day tomorrow, uh, which have a really, really strong lineup, and I cannot wait to watch those presentations. Can you share with me what has been your number one takeaway from the event so far in the two days that we've been here?

SPEAKER_01

Oh man, there's well, I mean, first off, anytime you come to an event like this, it's always connection. If your number one takeaway is not a connection you made with somebody, you probably didn't do the event right, right? Yeah, there's speakers and the speakers were all great and they're phenomenal and they give you a lot of good ideas. But the reality is, it doesn't matter if the talk's 30 minutes or two hours, there's only so much you can get from a speaker. But when you make a connection, genuine connection, and you know, there's people that I've already got meetings set up with that we're gonna have conversations and and you know, figure out how we may be able to work together. Or maybe we never work together, but guess what? We know each other now and we've got a connection, and I might have an opportunity to do business with them, they might have an opportunity to do business with me. Who knows? But I think that's where it comes down to. There's been a lot of AI conversation this week on how people are utilizing AI in their businesses. I love the thought process of this group. This group is not a group that's thinking AI is gonna replace everybody. It's how do we use AI to improve everybody, right? And I think that's a different mentality than I've heard in a lot of places of oh, AI is gonna just take over everybody's job. No, no, no. Wait a minute. If we do this right, AI could just improve everybody's role within the company. And so that was a big takeaway for me, too.

SPEAKER_02

Boom. Yeah, that very well said. You share something super key and super important as well, is those connections because one conversation that you can have with somebody can alter your business, literally your life, your life for the better. Yeah. I mean, yeah, I've had some incredible conversation. Like I mean, even just today, we have a meeting probably scheduled for next week. If depending on kind of how that conversation goes, that could potentially be a huge opportunity for me and my business as well. So it's super important uh for that. So, in the same vein for that, how important it is for a coach or an investor to be inside of an organization like Coaching Act?

SPEAKER_01

Yeah, well, I mean, here's the thing entrepreneurship's lonely already, right? Most people in a household, there's one entrepreneur, and then you've got your spouses and kids. And then a lot of times, you're the only entrepreneur of all your friends and family. You know, you see that a lot. And so being an entrepreneur is a lonely world. And as much as you would love to communicate and talk about the stresses of being an entrepreneur, that connection there, right? How you work together in those conversations are different from somebody that is in the battle and doing the entrepreneur world versus somebody that's not. And that's not a bad thing. That's not, it's just the reality. And so coming to a group like this, where you've got a bunch of people that have a lot of the same thinking patterns, that have a lot of the same mentality, that have a lot of the same struggles, and you know, they feel that same loneliness. And then they come to a place like this where they're like, ah, okay, I got some people I can connect with. We can have these little deeper conversations about, hey, my my cost per lead's down or up or whatever, and and I don't know what to do to fix it. And, you know, you can't have that conversation with your neighbor that doesn't do anything with cost per lead. You know what I mean? So that's the big thing. That's the big thing about these groups, is just being able to come to a place with like-minded people with the same problems, with the same wins, same losses, and you guys can work through them together.

SPEAKER_02

Absolutely. Boom. That was very well said. I know you're such a big giver. Um, you always have like, I mean, I've known you probably like for six, seven years now. And I've like, you one of the person that's always kind of share other things, jumping on the call with other people and doing stuff. Do you have any special gift or anything that you can give to anybody listening to this, whether it's like a PDF that they can kind of download to see where they are at in their financial wealth building stuff or like strategy, or maybe even? Like you know, scheduling a you know quick call with some other people. Any other ways that people can do that with you?

SPEAKER_01

Yeah. Well, first off, please reach out to me on Facebook. Like Jet mentioned earlier, I try to do my best to put a lot of content on there that's valuable and real. All the content that I talk about on Facebook is because I'm working with a client that's running through that problem and I'm putting the solution online. You know, obviously not disclosing the client, not disclosing anything like that. But that's one way. If you just want some free, good content, reach out to me on Facebook, follow me, all that good stuff. I've also got a book that AI helped me write. Speaking of AI, Caden, myself, and and AI, my partner is Caden, by the way, wrote this book. It's called the Tax Wealth Playbook. You can go to taxwealthplaybook.com. I'm sure we could probably get it in the notes at some point. And free book, it talks about uh how we believe in building wealth and saving money and taxes all at the same time. So I think it's a it's a pretty good read. Awesome. Boom. There you have it.

SPEAKER_00

Thanks for listening to Strength in Numbers. If you're ready to take control of your finances and start building real wealth in your business, be sure to schedule your free discovery call with markets at BECCFO.com to get started. Thanks for listening, and we'll see you on the next episode.