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Seven Steps to Financial Automation

“The factory of the future will have only two employees, a man and a dog. The man will be there to feed the dog. The dog will be there to keep the man from touching the equipment.”

- Warren Bennis

If you are like most agency owners, you probably started your own business for the pursuit of business ownership and the time freedom business ownership allows, not creating a 9-5 job for yourself. And who can blame you? Time freedom is a wonderful thing. Primarily it allows you to do two main items:


1.) It allows clarity to work ON your business and not IN your business.

2.) It allows you to enjoy the fruits of your labor knowing when you return, all will be ok.


With that being said each major system in your office must be independent of you, and your financial system is no different.


First, let us explain what not to do.

Let’s meet Brad. Brad is starting out his agency and was a great producer as a team member in an agent’s office prior to branching out on his own. Brad is excited about his opportunity and know he can perform on the sales side of the business.  However, when starting his agency he did not put much thought into his financial systems:

Do not do what Brad did:

  • He manually pays bills out of his business bank account
  • Writes checks for all his major purchases, and
  • When he has time, typically 2-3 months after the fact, he reconciles his business’s books

As he goes along, he becomes increasingly busy and finds it difficult to keep up with the mounting expenses, sometimes late on payments, incurring late fees, and is struggling with the time it takes him to deal with this. Come tax time, he is burnt out and knows he has a mountain of back work to organize his financials for his CPA. Sound like a nightmare? It should. Brad is stuck working IN his business rather than ON is business and eventually will reach a point where his business cannot grow due to his limited time.

Seven ways to achieve financial automation

Each major system in your office must be independent of you, and your financial system is no different.

The good news is there is a better way. If properly mapped, your financial system can automate your agency so it runs without you.

Now, let’s meet "Suzy."

Suzy is opening an agency and has met with several established agents and business owners. She understands the importance of working through systems rather than through people and in starting her agency she takes the following steps to create, as much as possible, a system for financial automation:

 7 Steps to Financial Automation:

  1. Setup Direct Deposit for Agency Commissions to a singular Business Operating Account
  2. All major recurring bills (i.e. rent)  that can not be paid on a credit card are put on auto bill pay from this account.
  3. All other recurring and non recurring expenses are paid on 1 or 2 Business Credit Cards (Points!)¹
  4. All Business Credit Cards are paid off automatically from Business Operating Account.
  5. All Business Lines of Credit are paid automatically from Business Operating Account
  6. Payroll is run the 5th and the 20th of every month to allow a few days of cash flow from her agency commission deposit.
  7. Sign up for a reputable accouting firm that knows your industry (i.e.: Club Capital) to maintain the aforementioned system, run payroll, and push Key Performance Indicators back to the agent to help scale the business. 


Click here for a quick video on how Club Capital helps insurance agents achieve financial automation.


Now, Suzy is truly operating as a business owner and enjoys working ON her business where she's able to focus her attention on where it matters most - growth and her bottom line! 

Seven ways to achieve financial automation

¹Two quick side notes on Business Credit Cards - to maximize their functionality it is important to pay off balances in full every month and to negotiate with Credit Card companies for the highest limit possible. Set reminders every six months to call Credit Card companies to increase your Credit Limit. This is important because your credit utilization rate (how much of your limit you spend every month) is one of the largest factors (35%) in determining your Credit Score. The safe range is 30% i.e. you have a $25K Credit Limit, do not put more than $7,500 on that card per month. Also, to maximize point accumulation, look credit card programs that have both a business and personal card so you can merge rewards points!


By Micah Cannon | September 22, 2017 | | 0 Comments

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