📂 Profit First in Action: Where to Begin
Now that you’ve been introduced to the Profit First method, you might be wondering—what’s the actual first step?
It starts with your bank accounts.
To make Profit First work, you need to separate your money into specific buckets. This isn’t just a theory—it’s a physical change in how you manage your business funds. When your money is clearly divided by purpose, you’re more likely to use it intentionally.
🏦 The Five Foundational Profit First Accounts
Start with these five:
- Income – This is your main deposit account. All revenue lands here first.
- Profit – A set percentage goes here first—your reward for owning the business.
- Owner’s Pay – Your salary as the owner. You work hard; this account ensures you get paid.
- Taxes – Set aside a percentage here so tax season doesn’t sneak up on you.
- Operating Expenses – What’s left after you’ve allocated profit, pay, and taxes. This is what you actually have to run the business.
Optional, but helpful accounts:
- Vault Account: For long-term savings or emergency reserves.
- Payroll Account: If you have employees or contractors.
- Materials/COGS Account: If you’re in a product-based or project-heavy business.
🔁 How It Works
Twice a month (or weekly, if you prefer), you’ll transfer funds from the Income account into the other accounts based on set percentages. These percentages are custom to your business—and we’ll cover that in the next post.
It might feel clunky at first, especially if you’re used to a single bank account doing all the work. But give it time. The clarity and control it brings is worth the initial adjustment.
📝 What to Do This Week
- Open your five foundational accounts at your business bank.
- Label them clearly and set them up for online transfers.
- Don’t worry about perfect percentages just yet—we’ll tackle that next.
- Want help setting this up? We are the only Profit First Mastery Certified accounting company in Iowa! We can walk you through it.
📞 Next Up: Choosing Your Profit First Percentages
In our next post, we’ll break down how to decide on the right percentages for your business. Every business is different—your numbers should reflect your reality and your goals.
Until then, if you’re ready to get these accounts set up and running with expert support, reach out to us at CFO Accounting Services. Let’s start making your business work for you.
