In this episode of The Agent of Wealth Podcast, host Marc Bautis is joined by Jen Paterson, Founder of Dollar Divas, a money coaching company that supports female entrepreneurs or mompreneurs who need financial assistance with their businesses.
Jen recounts her journey from being a financial advisor to recognizing the lack of tailored financial education for women, prompting her to establish Dollar Divas. Through open discussions and workshops, Jen aimed to create a non-threatening environment where women could address their financial concerns and learn essential money management skills. The concept of “paying yourself” emerged as a central theme, emphasizing the deliberate allocation of revenue towards personal income, business reinvestment, and savings, with Jen offering step-by-step guidance on implementation.
In this episode, you will learn:
- Practical steps for implementing the “Pay Yourself” concept, which emphasizes the importance of intentional revenue allocation towards personal income, business reinvestment, and savings.
- How entrepreneurs can navigate fluctuating income by adopting percentage-based allocation rather than fixed amounts.
- How societal influences contribute to women’s perceived financial inadequacy and tendency to prioritize others over themselves.
- How women can manage their finances with practical tools and accountability.
- And more!
Resources:
dollardivas.org | Bautis Financial: 8 Hillside Ave, Suite LL1 Montclair, New Jersey 07042 (862) 205-5000 | Schedule an Introductory Call
Disclosure: The transcript below has been edited for clarity and content. It is not a direct transcription of the full episode, which can be listened to above.
Welcome back to The Agent of Wealth Podcast, this is your host Marc Bautis. Today, I’m joined by a special guest.
Jen Paterson is the Founder of Dollar Divas, a money coaching company that supports female entrepreneurs or mompreneurs who need financial assistance with their businesses. With more than 12 years of experience, Jen has mastered the psychology of money, the step-by-step process of growing a business, and the art of creating financial stability.
Jen, welcome to the show.
Hi Marc, thanks for having me.
Founding Dollar Divas: A Journey of Empowering Women in Finance
Can you start off by telling us about your journey to founding Dollar Divas?
It’s a long story, but I’ll keep it short and sweet. I was a financial advisor in a previous lifetime, and while I was working in that industry, I found that the financial education for women was lacking. There was not a lot of information out there, and what was felt inaccessible to women.
So, myself and a friend of mine – who was a realtor – put our heads together and said, “Let’s just do it ourselves. Let’s get women together. Let’s get them talking about money.” Our goal was to do it in a way that is non-threatening, and in a very open and comfortable atmosphere. We wanted women to feel like they could ask questions. That was when Dollar Divas was born.
Its first iteration was in-person events. We’d get together at coffee shops to talk about money with anyone who was willing to show up, and it was a surprising amount of people.
So we did that, and grew that, and it fed our businesses and our souls. It was wonderful. Then, as my life changed and I became a mom, life got a lot busier and I wasn’t able to keep up with the financial advisor life. So, I decided to switch gears and move into the online world. I got into coaching, and the Dollar Divas brand just kind of evolved along with me.
I don’t do in-person events anymore, but the spirit remains the same – I create an environment for women to gather, talk about money and learn. That’s how I got where I am now.
When you first started Dollar Divas, and you were meeting with women at coffee shops, did you have an agenda, or was it more of an open and format? Did you see patterns and trends of the issues that concerned women the most?
We did both, actually. We would do structured workshops on specific topics, and we would host open discussions. Both were super fun.
In the open-ended conversations, you never really knew what women were going to bring to the table, so they were always very different – it depended on who showed up and what questions they had. We always felt like we had a lot of wisdom to impart.
For the structured workshops, our goal was to leave the women with something that they could use to improve their financial lives. A lot of the feedback that we got from those events was that they appreciated the very simple language used, and the practical nature of the topic. Whether it was investing, or real estate, or budgeting, women would walk away with something that they could implement right away.
What It Means to “Pay Yourself”
You mention simplicity, and one of the things you promote is this “pay yourself” concept. For those who haven’t heard of the concept before, what does it mean to “pay yourself”?
I find that, across the board, one of the biggest hurdles people face is implementation. Whether you’re looking to improve your financial situation, build a business, lose weight, and so on… People may understand the theory of what they need to do, but implementation is where they struggle. They don’t know how to look at their own lives and apply changes. That’s something that I work with a lot of my clients. We’ll look at their specific situation and how to apply a variety of concepts to their life.
When it comes to the “pay yourself” concept, people want to know:
- How do I do that?
- How do I structure it?
- What are the specific steps that I need to take in order to make it happen?
For example, I was working with a client last week. Together, we broke this down step-by-step. We started by looking at the client’s revenue – the money coming into her business account. Next, we got very intentional about allocating those funds. I asked her:
- How are you going to take those dollars and apply them to your life?
- How much are you going to spend on reinvesting in your business?
- How much are you going to spend putting towards your emergency savings account?
- How much are you going to actually pay yourself in salary?
We went through that process very intentionally and set it all up. It didn’t take that long, this isn’t rocket science, but sometimes you need a person to handhold you through it. By the end of the meeting, the client asked me: “That’s it?” And I said, “Well, do you want it to be more complicated?” She said, “Well, no, but I’ve always been very reactionary with my finances. I’ve never been proactive like this. I didn’t realize it was so simple.” The reality is, nobody ever taught her how.
That makes sense. Now, there’s obviously challenges that can come out of completing that exercise. For example, people struggle when their funds aren’t being allocated correctly. In order to change that, they usually have to make major lifestyle changes, like reducing their spending. But no one wants to be told they have to cut back, right? So, how do you help clients through this change in mindset? Is the approach slow moving, or do you suggest they rip it off like a band aid?
Honestly, everyone’s mentality is different. The band aid approach generally doesn’t go very well, but there is that unique personality type that can just go from one extreme to the other. I’d say that’s pretty rare.
Usually, what I recommend is to take stock of where you are right now. Determine:
- What are you currently doing?
- What is your goal?
- What are the steps that bridge the two?
Change rarely happens overnight, so this long-term approach. Take baby steps.
The Process of Paying Yourself
The challenge that I see all the time in my practice is business owners who do not pay themselves. Every dollar they earn is going back into the business, because they want it to grow and thrive.
In these cases, I’ll suggest, instead of putting 100% of the revenue towards reinvesting in the business, start with 99%, and take that 1% of your revenue to pay yourself. What happens over time is psychologically, the owners realize that they can run their business the same way with slightly less revenue. That 1% is pretty negligible. This process really shifts the mindset and it starts to help the entrepreneur realize that their business is not going to go bankrupt just because they are paying themselves. One little shift can make a big difference. Then, all you have to do is just shift it more and more – 2%, then 5%, then 10%.
The way that I like to look at it is like toothpaste. When you have the brand new tube of toothpaste, you load up the toothbrush and get going. As the toothpaste runs out in the tube, you have to get more creative about how you get it out of the tube. You have to twist it. Maybe you shave your thumb in it, maybe you’d break it open with a knife. At the end of the day, your teeth still get brushed. It’s just how you assess that toothpaste. It’s the same thing with our finances – we will find a way to make it work on less if we are so motivated to do so.
How Entrepreneurs Can Navigate Fluctuating Income
Yeah, I like that comparison. What are some tips you have for entrepreneurs who have variable income, when revenue differs month to month?
That is the story of every entrepreneur I’ve ever met. Whether your work is seasonal or you’re in those first early days of your business and you just can’t predict your revenue, there’s always reasons why it fluctuates. And so one of the things that I’ve worked a lot with entrepreneurs is ditching the traditional budget structure because a lot of the traditional budgeting just doesn’t work for entrepreneurs because we don’t have that predictable every two weeks you get this amount of dollars. That’s just not how business ownership works. When you’re creating your guide or your spend plan, I recommend using percentages rather than specific dollar amounts. So when you look at your revenue, look at just a single dollar. Everybody can picture a single dollar and it’s okay, how many cents of that dollar are you going to allocate to the various things that dollar needs to do?
So you have to think about things like taxes. So how many cents of that dollar do you need to put aside for your income taxes? How many cents of that dollar are you going to pay yourself with? How many cents of that dollar do you want to allocate to operating expenses and growth opportunities, whatever else, payroll, things like that. So looking at it like that, a lot more entrepreneurs, especially in the early stages, entrepreneurs, they can get their head wrapped around that concept and then they can really make quality decisions. So there are going to be times when that dollar amount doesn’t cover and you may need to do a little bit of shifting or moving around. But what it also does is when you are in high season and things are going really well and you’ve got lots of money coming in, is you’re putting aside cash to cover you in those lean months because you’re allocating based on percentages, not based on dollar amounts, and then deciding, okay, what am I going to do with this extra cash?
It’s already sitting there. And if you know your work is cyclical, for example, I ran an Airbnb as well, we are very much in our slow season right now, and because we knew this was coming, we have an account that’s dedicated to covering the shortfall for when the slow season comes because I know it’s coming because it’s January and Victoria and it’s raining and nobody wants to come create those systems that are going to work for you to help you navigate that feast and famine lifestyle. Because at the end of the day, you can get to a point where your revenue is relatively stable, but it’s never going to be exactly the same every single month. It’s just never going to happen. So using percentages and then creating more bank accounts to put that money aside, so it’s out of sight, out of mind to fund the shortfall really is an effective way to navigate that rollercoaster.
And I guess by doing that, by setting that money aside, you’re almost creating, you’re mimicking someone who works that typical nine to five works for their W2 employee, and you’re almost able to mimic that, basically build your own salary from that.
Exactly. You hit the nail on the head. Again, I like metaphors and analogies I find people really gravitate towards. And so I think of it like a well, when it rains, the well fills and then when you go through a drought, you just drain the well, you’re not having to go and search out more resources elsewhere because you’ve got that well sitting and ready and waiting for you for the dry season. It’s going to happen. We all know it. No matter what job you’re doing, something’s going to go sideways. And having that nest egg that well to draw on is only going to make your life easier.
On your website, you offer a simple money roadmap. Can you explain what it is and how that works?
Absolutely. So that is my signature pro coaching program. So it walks entrepreneurs through the step-by-step process of creating this money management system. So going from figuring out where you are right now, creating your bank account architecture is what I call it, the multiple different bank accounts that all serve different jobs. So we walk through creating that together. We talk about how to set goals and how to make them not just goals, but actual outcomes that you can accomplish, tick off a to-do list, and then how to use your revenue strategically and intentionally. So creating what I call a revenue allocation schedule, which is basically just a fancy way of saying what to do with that dollar, and then how to grow your business in a way that is financially stable, creating a foundation and having the growth opportunities available to you as well as being able to pay yourself. So basically being able to do it all and creating the money system to do that. And then the very last piece of the puzzle is how to grow and evolve with your business. And at that point, usually my clients, they go off into the sunset and I hear from them every couple of years saying, this is where I’m at, and it’s really fun and exciting for me. That’s the roadmap. It’s a three month coaching program, and it really will transform the way that you see money and the way that your business supports you.
But then do you also look in it on the personal side? Because what I’ve seen is entrepreneurs, one of the things that makes ’em different is decisions they make on the business side can impact the personal side and then decisions they make on the personal side can impact the business side. And it’s challenging to kind of juggle both of those versus someone who maybe just needs to focus on one side of the equation there.
Absolutely, yes. Yeah. So number one rule is business and personal shall not meet in the middle. If you are using your personal bank accounts to fund your business, then you are going to have a lot of gray hairs coming your way because that is going to be a messy misty situation when it comes to taxes. So absolutely, yes, the money goes into your business bank accounts, and that is how you pay yourself personally. It keeps it much neater, much tidier, and your accountant will be very, very healthy if you have it set up like that.
Another thing that I’ve seen unique to entrepreneurs is it can get challenging to manage the work-life balance where and not that work nine to, if you have a regular nine to five job, of course that can get out of control too, but it’s very easy on the entrepreneur side. Any advice you have from your experience or from working with other people on how best to be an entrepreneur but also manage to work life balance?
Honestly, it depends on the client and it depends on their situation. So quite often if a client is married or has a partner and their partner is not really on board with doing the coaching program, then we’ll sort of say, okay, if you have a system that it’s not broken, then that’s great, but if that’s something that they’re struggling with, absolutely we will talk about it. And quite often I usually recommend very similar programs and very similar structures to the personal finances as I do for the business finances, especially when you’re dealing with entrepreneurs because it’s like if they can manage their money in the business this way successfully, then it’s very easy to just apply the same methodology to their personal finances. And quite often what I’ve seen with my past clients is that they really appreciate the parallel between the two and they can really see it. A lot of the entrepreneurs I work with tend to be very intuitive, very visual people. And with the account architecture, you can see it right there in black and white in seconds where you stand, and that’s something that they really love and appreciate.
Yeah, time blocking reminds me of the whole pay yourself concept. Everyone knows what it means. It’s tough to implement because we’re obviously so distracted with everything that’s going on, but anyone, you read anything about productivity or you talk to someone and they’ll say how key time blocking is and how if you have something that needs concentration to do, you basically have to tune everything out and do your concentration, or if you’re going to do this, just tune everything else out and this is what you focus your time on. So it’s challenging, but definitely something that’s necessary to do.
Honestly, I wish I had better advice, but I’m not great at that personally. So I have two kids, I’ve got three businesses. Life here is chaos all the time. And I wish I could say, oh yes, it’s perfect and wonderful and lovely, and it’s just not. But I will say that things that work for me are a very strategic and scheduled week. So I use time blocking in my life where if my calendar says that I am to be in meetings, then I’m in meetings. If my calendar says that I am to be dealing with my bookkeeping, then I’m dealing with my bookkeeping. If it says that I’m to be sitting on my tush watching Netflix, then that’s what I’m doing. So creating that space and looking at my week from a bird’s eye view and saying, okay, where am I putting in my self-care? Where am I putting in my work hours? When do I need to be accessible to my kids? Drop-offs, pickups, things like that’s what works for me just because I am very type A, I love a good spreadsheet, and that’s really what keeps me on top of everything while not burning out, but it’s not always successful because life happens.
Yeah. You started off the episode by saying that you work with female entrepreneurs. What are some of the things that are different between females and males when it comes to finances?
I will say one thing that really was a life-changing read for me was a book called Tiny Habits by BJ Fog. His methodology changed the way that I view my life. He said, “If you can’t do something in eight seconds, it’s probably not going to happen.” I appreciated that, because usually eight seconds was all I ever had to create something new. So he was all about the trigger points, and once you get started on a habit, then it just flows. And that really was life changing for me. So focusing, not necessarily on the whole activity, but just that very first tiny little step to get it going, made all the difference in the world. So I know if I have bookkeeping time blocked, I know that I’m necessarily going to focus on not the whole bookkeeping process, but just gathering my receipts. That is my trigger point. And once I’ve gathered the receipts, the rest of it just happens, but it’s that very specific trigger point and celebrating when I win and actually gather the receipts at the time, I’m to so highly recommend that book. It really was a game changer for me and for a lot of my clients.
I find that women, first of all, because the society has told us we’re not good with money, they already have this sort of level of mental block around dealing with money. They don’t want to talk about it. They feel embarrassed about it, they don’t want to ask their questions. So that first and foremost comes up is let’s talk about those mental blocks of why you think you’re not good with money. Why do you think that you’re doomed essentially to not be good with money? And then the other thing is women tend to put themselves last. Again, societal pressures we’re caregivers, we’re nurturers, and we’re at the bottom of the totem pole. I mean, you look at any sort of mom and their kid is well dressed and put together. And even myself, my own appearance today, I didn’t get a chance to blow dry my hair because I was too busy getting my kids out the door and to school.
That manifests itself in the not paying ourselves because our business becomes our baby. It becomes a priority. And once again, we fall to the bottom of the totem pole and don’t get paid. So I quite often have to break down a lot of those barriers before we can even start on the strategic work. We have to talk a lot about that mindset. And I love working with women because it’s an experience that I’ve had myself. It’s a journey that I’ve walked through and continue to walk through throughout my life. And I feel like I’ve got a lot of wisdom to share with other women, and it’s a lifestyle that I understand, especially dealing with moms too, because that is a life that I live every day, and I know how important it is to make sure that what I provide to them is things that they can do quickly, easy, and intuitively, because otherwise it’s just not going to happen.
That makes sense. Alright Jen, that’s all of the questions I had for you today. Thank you for joining me on The Agent of Wealth Podcast, I really enjoyed speaking with you about these money habits that entrepreneurs and mompreneurs can implement. How can listeners learn more about what you do, or get in touch with you?
Absolutely. Your listeners can follow me on instagram @jenpatterson.biz. They can also check out my website, dollardivas.org. I’ve got my simple money roadmap there that you can check out. The other thing that I’m just launching starting next week is Friday mornings I’ll be hosting free coworking power hours. So I’ll be available on Zoom. You can pop in, pop out, you can just log in and work alongside me. And it’s to provide entrepreneurs with the opportunity to ask questions or just have some accountability and make sure that their money gets paid attention to on a weekly basis. All that information is on my website, dollardivas.org.
Great, we will include all of that in the resources section of the show notes. Thanks again, Jen. And thank you to everyone who tuned into today’s episode. Don’t forget to follow The Agent of Wealth on the platform you listen from and leave us a review of the show. We are currently accepting new clients, if you’d like to schedule a 1-on-1 consultation with our advisors, please do so below.