I learned one of my most important business lessons when I was around 18 years old. Unfortunately, I learned it by doing almost everything wrong.

Before photography became my career, I started a small merchandising business in Peru. We received an order from a large German company for custom T-shirts. We found excellent suppliers, used beautiful Peruvian cotton, produced and printed the shirts, and delivered the order successfully. The business worked.

The client was happy. The project was profitable. We got paid. And then I took the money and went on a trip to northern Peru. I spent it.

At 18, I looked at the money that had arrived in the account and thought that because the business had earned it, the money was mine. What I hadn't understood yet was that part of that money was what allowed the business to continue operating. When the next opportunity came, I no longer had the working capital I needed to produce another order.

The problem wasn't that the business had failed. The business had actually worked very well.

I had confused revenue with money available to spend.

It was an expensive lesson, but one that has stayed with me throughout my entire career.

A profitable business can still run out of money

Years later, I finished my studies in economics, worked in risk management, and eventually quit to build a career as a photographer. I learned much more sophisticated ways of looking at money, but I still think that little merchandising company taught me something incredibly practical.

Money entering a business account doesn't automatically belong to the business owner. Some of it already has a job.

There are taxes to pay. There are costs involved in producing the work. There are subscriptions, accountants, office expenses, and equipment that will eventually need replacing. There are months when revenue will be lower than others. And somewhere inside all of that is the amount the business can actually afford to pay you.

This becomes particularly important in a creative business because our income isn't always predictable.

Photography is highly seasonal for me. I know there are months when Amsterdam will be filled with visitors, and my calendar will be very busy. I also know there will be quieter periods. After doing this for many years, I know my cash flow extremely well. I know when money usually comes in, when expenses increase, and when I need to be more conservative.

That knowledge has become much more valuable to me than simply knowing how much money happens to be sitting in my bank account today.

I don't rely on discipline anymore

The biggest change I have made over the years is surprisingly simple: I stopped expecting myself to make the correct financial decision every time money arrives. Instead, I make the decision once. Then I automate it.

My photography business now uses separate accounts for different purposes. Money needed for production has its place while VAT and other fixed obligations have theirs. The money for my accountant and office is accounted for. The business has its own savings, and part of every session contributes towards future equipment replacement, because each session uses a part of the life of the equipment involved.

Those amounts aren't available simply because I can see them in a bank account.

This means that when a camera eventually needs replacing, it doesn't suddenly become an enormous unexpected expense. Every client who has used that camera has contributed a little towards the equipment that will eventually replace it.

The same principle works with taxes. If the money isn't mine, I don't want it sitting beside money that is. I don't need to repeatedly remind myself not to spend it. The system makes that decision for me.

I use the same principle in my personal life

Interestingly, this way of thinking about money eventually became part of how we organize our household too. My partner and I haven't combined all of our finances. We have our own accounts and our own investments, but we also have shared expenses and shared goals.

Instead of constantly calculating who paid for groceries, who paid for dinner or whether one person owes something to the other, we calculate what our shared life costs. We contribute an agreed amount automatically every Monday into a shared account, with enough extra that the account normally remains in surplus.

Our groceries come from there. We order them online, normally buying what we need for the meals we have planned rather than accumulating food we don't need. Household expenses come from the same system. If we want to go to the cinema or take a day trip, we simply go. We don't have a conversation every time about whether we can afford it. The financial conversation happened much earlier, when we designed the system.

Travel works similarly. We contribute separately towards holidays. When enough money is there for a trip we want to take, we can book it and pay for it without returning home to a financial problem created by the holiday.

We still talk about money regularly, but our conversations aren't usually about permission to spend. We talk about our investments, companies we're researching, future expenses, and things we would like to do.

We actually have very different investment styles, which is one of the reasons keeping our investment portfolios separate works so well for us. We can discuss ideas without needing to agree on how the other person invests their own money.

For us, being a team doesn't require combining ownership of everything.

I also started from a privileged position

There is an important part of this story that I don't want to hide.

When I moved to the Netherlands, my partner already owned his home. The house and mortgage are his, and from the beginning he was very clear that I wouldn't contribute towards his mortgage. I contribute to the household and the services I use, but I don't pay rent or mortgage payments. That is a significant financial advantage.

Instead of treating the money I wasn't spending on housing as additional spending money, I decided to use approximately that difference to build my own financial security.

First came my emergency fund. Once that was established, the money could begin moving towards investments. I also came into entrepreneurship with another advantage: a background in economics, risk management, and financial markets. I already knew how to research companies, understand risk and manage a portfolio.

I don't think it would be useful to tell this story while pretending those advantages don't exist.

But having an advantage and using an advantage are two different things. The financial conditions of my life changed when I moved to the Netherlands. What mattered afterwards was deciding what I wanted to build with them.

Financial security changed the way I run my creative business

This is perhaps the part I didn't expect. Building financial security didn't only change my bank accounts. It changed my photography business.

When you desperately need the next client to pay a bill, saying no becomes extremely difficult. You accept projects you don't particularly want. You might agree to collaborations that don't really benefit your business.

Financial security creates another option. I can look at an opportunity and ask whether it makes sense for my business rather than whether I need the money immediately. I can decide that a project isn't right for me.

I can invest in equipment when the business has generated enough money for it, rather than making the purchase first and figuring out how to pay for it later, and I can make decisions based on where I want the business to be in several years rather than what I need it to produce this week.

That, to me, is one of the most valuable forms of financial independence. It is about not being controlled by every individual financial decision.

Make the decision once

It has taken me many years to understand that good financial management isn't necessarily about having extraordinary discipline.

I don't want to stand in front of my bank account every week and decide again how much I should save, how much belongs to taxes, whether I can afford new equipment, or how much the business needs for the quieter months.

I would rather make those decisions when I'm thinking clearly, create a system around them, and automate as much as possible.

At 18, I thought a successful business made money. I received the payment, saw the profit, and spent it. It took me years to understand that earning money is only the beginning.

A sustainable business needs to know what that money is for before it arrives.

Today, every part of my income has a purpose before it arrives. It supports the business I have now, protects it through quieter periods, and helps build the one I want in the future. Only after those things are taken care of do I think about what is actually available to spend.

The result isn't simply healthier bank accounts. It is freedom.

That freedom changes the way I make decisions. I can turn down work that doesn't feel right, and take time away without wondering which client will pay the next bill. More importantly, I can think about the business I want to have five years from now instead of making decisions based on what I need by Friday.

I learned at 18 that revenue is not your money. What took me much longer to learn is that when you give your money a purpose, it gives you choices in return.

Until next time,

Joanna

Your Vacation Photographer in Amsterdam