How to Hire: Complete Guide

Thinking of hiring your first or maybe 100th employee?Today, we're diving into everything you need to know, from financial preparation to practical tips. Plus, we'll get into the debate about whether to jump in before you're ready. So whether you're ready to hire now or planning for the future, this episode will help you avoid the common pitfalls

that trip up most employers. For those of you with employees already, keep listening, because returning to the tried and true is a great reminder for your next hire and to retain the staff you already have. In a world where chaos seems to reign supreme, where uncertainty lurks around every corner and financial markets are now more unpredictable than ever. There's one place you can turn to to find clarity and control.

Welcome to the Wealth Wisdom Financial Podcast. Hey, I'm Brandon. And I'm Amanda. Join us as we dive deep in the world of personal and business finance to assist you in navigating through the chaos and building the financial future you deserve. We believe when conventional financial thinking doesn't get you where you want to go, you need wealth wisdom. So if you're ready to take control of

your financial destiny. Tune into the Wealth Wisdom Financial Podcast because in a chaotic world, your money shouldn't be. Subscribe now and never miss an episode. I

want to take you in our Wayback Machine. Of course, you know, we like time machines here, like the DeLorean and stuff. So we're going to go back to our first hire in 2011. We were hiring our first barista. So our bar was pretty low. I mean, literally we were hard to be a barista. Yeah, we had people do dishes and all that fun stuff. And in the beginning we were recruiting first, you knowOur friends, because everybody wants to work at a coffee shop, apparently, or friends

of friends. And that got us through the first couple of years, right?So we were able to leverage that. But over time, we needed to veer into the world of job postings, putting it on Indeed and on or Craigslist at the time. Yeah, yeah, and onboarding. Since then, we've hired so many baristas. Administrative staff and many roles to count. So I think that we're pretty, I wouldn't say we're experts, but we've done it a few times. We've helped a lot of people and you know, it's been

fun. Today we're passing on what we've learned. From our experiences and challenges, from getting input from those we've hired to many other things and many people that we have even today. Yeah. And from people who have hired way more people than we have to. Yeah, yeah, yeahSo we're gonna

start with probably the most opinionated idea. And yes, there's a lot of opinions, of course, about everything. And yes, it's going to be about money because this is a financial podcast after all. But I think it's really interesting how we're going to tie this into some of the other things that people who teach people how to hire might talk

only about. But with because they don't focus on the money, they miss out on how the talking about the money can actually boost the other parts of the people part of your business. So. This is what something most business coaches are not going to tell you about hiring employees. Here it is. It's just as much about your business's financial structure as it is about finding the right person. I'm going to say that again, very controversial

here. It's just as much about your business's financial structure as it is about finding the right person. Today we're going to talk about what all that that means and what that looks like. We've seen far too many business owners rush into hiring without the proper financial foundation, only to create stress for themselves and their new hire.

But we've seen also seen entrepreneurs wait too long, thinking they've got to have their financial system perfect and they miss growth opportunities because they're of that perfectionism. Today we're going to find that sweet spot between preparation and action. understand how that money foundation, financial foundation of your business actually helps you hire better. Yep. And I, and again, I think that's really important to know and think about,

right?And we might land on one side or the other, but it's a middle ground. Yeah. So we've got three crucial

layers to the financial side of the business that we're gonna talk about. And I'm gonna kind of introduce each layer and Brandon's gonna help like bridge that into some bonuses. of how the how you hear these normal business coaches kind of talk about hiring, how actually what I talk about with money bridges into those those areas. So first, this essential foundation of having Profit First properly set up in your business. If you're not familiar with

Profit First, it's amazing. We're going to kind of talk a little bit about it. But if you've started Profit First, if you had a little bit set up, this is going to help you take it to that next level. It's not just about having the separate bank accounts, it's actually knowing how much you can sustainably spend on payroll. Yep, since payroll is one of our biggest expenses, right?As we grow businesses. Yeah, most businesses, yeah. So are you at your

target allocation percentages yet?Should you hire before you are or not, right? Like, that's up to you, but great question to ask, right?Are you building up some cushion in your operating expense account?Are you having to borrow from your other accounts to fund the OpEx? That's going to be a different kind of signal for whether you should hire or not. How is your debt paid down from your quarterly profit distributions going?Are you seeing your debt go up?Are

you seeing it go down?Are you able to make those quarterly profit distributions to help pay down your debt and to reward yourself for the risk you're taking in your business?There's this marketing analogy of a campfire. We're taught when we're doing marketing to make sure your marketing fire is going, that you're actually generating some leads before you pour more fuel onto that fire and try to generate a whole bunch more leads.

Otherwise, if your fire's not lit, you end up with wet locks when you just pour more fuel onto it. That's it's similar with hiring. It's better to have an employee come into a profitable business and make that business more profitable. Than to think your hire is the magic pill to make your business profitable. With the latter where they're the magic pill, you end up with a business even less profitable than it was before. You just spent all this money in hiring,

right?And that's like the wet logs equivalent of that campfire analogy and probably yourself even closer to bankruptcy. Yeah, I think that's a big thing to also think about, right as we've. done and worked with lots of clients and you look at their, their OpEx and all that stuff, and I'm like, wow, their payroll is really high and they're not paying themselves. Uh, and that makes a big difference and it impacts their psyche as a business owner, becomes a hobby, not a prof, uh,

business. And so we wanna really think, uh, about that, how those intersect. So now do that where, you know, apply this to how most business coaches would talk about hiring and how this, you know, you've set up your financial foundation, what that actually does. By taking the time to set up your financial foundation, you get to know yourself better, right? Plus, you'll see the gaps in the business and in your own expertise, right?So by really

learning about you. then you hire people to fill those gaps and make the business better rather than hiring people just like you or like you or whatever. Like attracts like, right?You're hiring people that you like rather than people that your business actually needs. Yeah. And they become similar to you. And then you're you're not actually growing other the business, you're just kind of feeding your ego or something. I don't know. So really also, and if you want to want help in knowing, let

me go back. So if you want some help getting to know yourself, we've taken plenty of tests, like from the Enneagram test to the Myers-Briggs to Predictive Index and so many more. Like by doing that and taking that work as a business owner, knowing yourself, that's not only going to help your marriage, right, but it's going to help your business. And I think there are so many things that you can do as a team dynamic that is gonna amplify

your business. And then I, again, I suggest putting a line item in your budget for development and even possibly working with an expert in that area. Uh, and if you're looking to dive deeper intoThose kind of things. I have a friend, his name is Brian Alexander, and he has this business called Ready, Aim, Climb. He's a ninja in people development, right?And so you wanna not just invest in your people's payroll. and yourself, but you also want to invest in knowing them and knowing how you can

work together. And you can go for his, if you go to ready and climb, uh, that's his link. And, um, there's gonna be show notes and all that stuff. And then just say, hey, I heard about it from Wealth

Wisdom Financial. I don't know. Great. So moral of number one, your first layer, you set your financial foundation, fully implement profit first,That helps you not only have the the money set and the new employees coming into a profitable business, but it also helps you identify the gaps and get clearer on who you're gonna hire, why you're hiring them, not just who you're gonna like, but also who's going to fill in the gaps of, 'cause you can't be perfect at

everything and doing other things. Really? Really, yeah, yeahSo now we go

to the second layer. And this is an ideal scenario, not totally required, but highly recommended. This is where, as you're working profit first, you end up with a vault. We've talked about the vault a lot of times on this podcast. If you want to get familiar, go back and listen to some past episodes. And the vault becomes kind of a, you can use it as a testing ground in this case. So imagine this, you pretend to pay your future employee for about three months.

And you just move that money into your vault instead. So it goes from the OpEx into the vault as if you're paying that employee. So you kind of build that habit, feel that what that feels like. It's kind of like a dress rehearsal for your business's cash flow. And what employee would not want to come into a business with three months of their pay on hand just in case they go through a cash flow crunch like we talked about a couple episodes ago when we talked about

cash flow management. Like for an employee to know like, hey, I pretended to pay you for three months before we hired you. If I know I can do that now, but also if business doesn't go as expected, we've got three months of payroll. That is a huge signal to the person that you're hiring that you've got a legit business that they can build a career in. Now is 3 months the right number?It could be one month, it could be 6 months, right?

Could any of those be better?And that could vary depending on the variability of your cash flow, right?And how your seasonality, things like that. You decide what to have in your own vault, just to make sure it's there specifically for payroll. And you have separate funds for all the other things you need to cover during a cash flow crunch. Yeah. Right?

Like taking that vault and kind of using envelopes within that vault or, you know, categories within that vault to make sure this is for payroll, I'm not gonna touch it except for payroll. Yeah, I think that also like from a employer standpoint, one of my staff is like, hey, we're going too slow or we need we're or it's too fast. And I'm like, well, I'm thinking about 3

months, four months in. And what we're doing now, even though it's a busy time, helps to make sure we're good during the quiet times because there there will be quiet times. As well. And so we just kind of roll with it, but also making sure I'm thinking about his payroll three months he might not be. He's thinking about right now. And so we as a business owner, we have to kind of

be in both. basis. Yeah. And so the other thing here is that as you're taking this time to move that money to the vault each month and you're feeling what it feels like to have that, it also brings you some more clarity on who you're hiring and what you want them to do. You want to talk a little bit about that?A little bit different than this personality and personal development side we're talking about. This, you were telling me, is more about their job

description. Yeah. So if you have clarity and you know what you're hiring for, you, you then start building a job description. Maybe that's gonna be different than yours, right?And, uh, it goes back into as you're building the team and you're building their job description, uh, you might learn that that 8020 rule and helping to build more focus and seeing what's working, what's not working. Um, but, but then

that helps. You amplify and grow the business even further because you've hired the right people in the right seats. You're able to then see, oh, well, I'm not just hiring a person that's doing busy work, but we're hiring a person that's moving the business forward because that's, I mean, if you're a business owner, that's what you want is to move it forward, right?Yeah. OK, so we've talked now about profit 1st and then the vaults and how you can build some cushion there.

This might sound way too idealistic, like holy cow, I can't wait to do all that stuff before I hire. So stay tuned after the break for we're going to call it the reality check and this is where it gets really interesting. Ready to take the next step towards securing your financial future?Whether you're planning for retirement, saving for your dream home, or you just want to make your money work harder for you, the team at Wealth Wisdom Financial are ready

to assist you. And now it's easier than ever to see how we might give you a boost on your financial journey. Schedule a 15 minute discovery call with one of us today. And let's discuss your questions and your financial goals together. Don't wait any longer. Your financial freedom awaits. Schedule your discovery call at www.wealthwisdomfp.com/call.

Now you might be thinking, but what if I can't wait three months?My business is bursting at the seams. And you're right, sometimes the cost of waiting is higher than the cost of imperfect timing. I recently worked with a client, we'll call them Sarah, who runs a successful graphic design business. Let's say Sarah was drowning in work, turning away clients because they couldn't handle it, right?And Sarah didn't have her full

financial system in place. And so together we ran the numbers and realized she was losing more money by not hiring. Then she would risk by hiring before her systems were perfect. So we looked through it and she moved forward with hiring. It was a really great decision because now she actually has some of that time freed up. They're not turning away clients, and she can instead spend some time setting up those systems that she could have never set up because her schedule was just too full.

I think that's again, as a business owner, having that thinking time or having the guides there to help you make that decision. And sometimes we're too busy running around. We feel like we don't have the time. But by stopping, having that thinking time, having that time probably with you, yeah, allowed her to move in the right direction. Yeah. So the key here is to understand the difference between essential preparation and optional

optimization. In our very humble opinions, we think that essential is really only a couple things. Three things, actually. 33 is a great number. A clear understanding of your cash flow. Even if you don't have profit first fully implemented, you know, like here's about how much it comes in, right?Here's how much it comes out. You've got a basic understanding. To at least one month of payroll in reserve. If you're turning away clients like Sarah was, you should

have enough in the bank, right?Or in a vault where you know you could cover payroll for a month in case all those clients and potential clients just disappear. And then you need a basic payroll system, right?You need a way to pay them to collect their identity information to make sure they're eligible to work for you. You know, anything like that. That anything else, right? Everything else other than those three things, clear understated cash flow, at least one month of payroll and a basic

payroll system. Everything else can be optimized as you go. Can I add something that I was thinking about here is, you know, there's the Rocket Fuel book by Gino Wickman and that having that visionary and the integrator, some of those things, maybe your first person that you hire is maybe. Integrator. They might help you develop those systems, so you might not. That might be like, oh, I'm

overwhelmed by it. But that's an important thing to make sure that as you build your business, an integrator role or something that helps to. Take that minutia off. Yeah. So you can imagine Sarah, in our example, might sit down and say, do I want to be doing more graphic design?I could continue what I'm doing and hire an integrator. Or do I want to shift from doing so much graphic design to do some of that integration myself?Is that in my skill set?Is that what I really

want to be doing?And I need to hire a bunch of graphic designers to take on more of this?Yeah, yeah, great. I think that's an important thing. OK. And then there's one more alternative we'd be remiss not to mention. If you simply can't wait and you need someone before you've got all those foundations set, you don't have to hire an employee. You could hire a VA, a 1099 from a third party or directly. We did this with administrative help before we went on with hiring full-time W2 admin help.

It was tremendously helpful. One tip here if you're going to go that route is have that 1099 admin. Help write down those processes that they're learning, that you're teaching them. Create some of those standard operating procedures, SOPS insights to make training that W2 admin even easier when you get to that point. Very legitimate, often used path to take and one that we

found really helpful. Yeah. And if you want other resources for VAS, we have several that reach out to us and we can point you in a few places that have helped us and that you know we. We could share our groups that we're part of. Yeah. OK, so the path to hiring isn't always linear. Well, having a profit first set up, testing your payroll capacity through

your vault, those are ideal. The most important thing is ensuring that you can sustainably cover payroll and basic benefits and still pay yourself and still have profit, right?Not just pay yourself. A little bit. But pay yourself. Like, for real. Yeah. Start with the essentials. Test what you can and be prepared to learn and adjust as you go. No one does this perfectly. Embrace the imperfection. Embrace the mess. But also keep your future bigger than your past.

Yeah. OK. And then one final tip here. Yeah, I want to share this. This is a lot

of fun. So we learned this way back before and we we've shared this many well before our first hire. Yeah. And we had met this guy again. We've shared this. His name is Perry Marshall. He wrote a book called 8020 Sales and Marketing. Didn't know he was famous at the time. Didn't know anything except we were told, hey, you should talk to him because he's a business expert and he could help you.

So, so we had a beer with them and what stuck with us in that that one of the many things, yeah, in that initial conversation was audition instead of interview. So what we did, and this is something you could think about, which is very helpful, is we had people come in. Well, we would talk to them a little bit, ask them some normal interviewee kind of questions, but then we'd go walk over to the sink and teach them. Here's the three section sink, how you wash dishes. We wouldn't

teach them too much. It was just a basic overview. Yep. And we would see, you know, maybe if they didn't learn how to wash dishes from. I don't know, parents, um, then they aren't gonna be good for the job. If they didn't know how to sweep, uh, I mean, you'd think this would be obvious, uh, but it wasn't. And you'd be able to see. Or like you can

take instructions. Yeah. Too. Right. So, So that helped us to be able to see, cuz, you know, as, as you've been hiring people, I'm sure, or are about to, people write a lot of amazing stuff on paper. But then you get to see how they actually work, and that's an important thing. So audition as well as interview. Yeah, and we highly recommend that 8020 sales and marketing book. You can read chapter 17 probably a few times before even posting a job description.

You'll learn this idea of auditioning instead of interviewing, as well as a a lot of other things. Total game changer. And then maybe read 8 chapters 18 and 19 about hiring and firing. Those are really great too. So check that out. So

are you ready to take the next step in growing your business through hiring? We've created a detailed hire readiness checklist. We shared a lot here. You're not going to remember it. You're probably going to want this checklist. It's a comprehensive guide that walks you through both the financial and the operational prerequisites we believe you need to have in place. You can head over to wealthwisdomfp.com/community and join the community and get that

checklist. Also inside the Wealth Wisdom Financial Community, again at wealthwisdomfp.com/community, you'll find lots of resources to grow a sustainable business that builds your personal wealth. Don't wait until you're overwhelmed to start preparing for your first or your next hire. Visit wealthwisdomfp.com/community today and get that checklist and join a community of business owners who are navigating this journey as well. Let's make your hiring success story. And if

you haven't noticed, we are doing a lot more for business owners. I mean, we love that. I was just talking to somebody the other yesterday and you know, again, we do a lot with the infinite banking concept with Profit First, but having that expertise of running a business, hiring people really. Amplifies your business and your business and personal intersect. So the articles that Amanda puts in the community, and I do as well, are

really, really helpful. And the relationships that are built, again, Brian Alexander is a key example of people that maybe aren't the financial foundation. Work, but you could then use them for the various aspects that are needed in your business at the right time. Yeah. So thanks for joining us. Hit that subscribe button so you don't miss this whole month. We're going to be talking about building your a team. Today we talked about with internal. We're going to go into some external a

team members in the future. The A-Team. Well done. Yeah. So don't forget, live long. I keep saying that. Don't forget. You know this. Live long and profit. Don't forget. Man, I did it again. Write a review, post comment, share this with right. Don't forget in the comments. Don't forget to do that. You know, I I feel like I have to say that because people don't do it. So do it. We love it. And remember the topics presented in this podcast are for general

information only. And don't forget to only for the purpose of provide, not for the purpose of providing legal, accounting, investment advice on such matters. Matters. Please consult a professional who knows your specific situation and make sure you know yourself by taking these tests. So don't forget, remember, and make sure they're all the same thing. Oh, there you go. Yeah. All right. We'll work on that until until next time. Take care. Those are my fillers.