Real estate agents, are you managing your finances effectively? If you find yourself on a roller coaster of fluctuating income and expenses, it's time to dive deep into financial management. Kyle Whissel and Bryan Koci of Whissel Realty Group, in their podcast episode titled "Why Your Business Will Fail If You Don’t Do This One Thing," discuss critical financial strategies that every real estate agent should implement.

Understanding the Basics of Financial Management

Kyle starts the conversation by addressing a common scenario many agents face: inconsistent income. This inconsistency can lead to stress and a lack of control over personal and business finances. He emphasizes the importance of understanding and managing your finances to maintain a stable business. According to Kyle, knowing the basics like your profit and loss statement and having a budget are crucial. These tools help you understand where your money is coming from and where it’s going, which is essential for making informed business decisions.

Tactical Tools for Financial Stability

Bryan discusses the practical tools that agents can use to stabilize their finances. He recommends setting aside specific times for income-generating activities such as prospecting and lead follow-up. Bryan suggests dedicating at least two hours per day to these activities — one hour for new client prospecting and another for following up with existing leads. This routine helps ensure a consistent flow of business and, consequently, a more predictable income.

The Importance of a Profit and Loss Statement

Kyle points out that many real estate agents overlook the importance of maintaining a profit and loss statement. This financial document is crucial as it gives a clear picture of the business's financial health. Without it, agents are essentially flying blind, not knowing if they are operating at a profit or a loss. He stresses that having a P&L is not just for large businesses; every agent who wants to succeed should maintain one.

Setting Aside Taxes

A significant point of stress for many real estate professionals is tax management. Kyle advises setting aside a portion of each commission check for taxes. He recommends saving about 20% of each check in a high-yield savings account, which not only prepares you for tax season but also earns you a return on your savings.

Leveraging Technology for Financial Management

Both Kyle and Bryan agree that technology plays a vital role in managing finances. They discuss various tools and software that can help real estate agents keep track of their finances, from simple apps to more advanced software designed specifically for real estate professionals. Using these tools can automate much of the financial management process, allowing agents to focus more on selling real estate and less on managing numbers.

Conclusion

Effective financial management is crucial for the success of any real estate agent. By understanding and implementing the strategies discussed by Kyle Whissel and Bryan Koci, agents can stabilize their income, plan for taxes, and ultimately run a more successful and less stressful business. Remember, the key to financial stability in real estate is not just about making money—it's about managing it wisely.

For more insights on real estate success, tune into "The Whissel Way" podcast, where industry experts Kyle and Bryan share their experiences and advice on thriving in the competitive real estate market.

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