So it’s December 23.

Most business owners I know are trying to do two things at once right now: finish the year strong, and somehow be fully present at home.

And the truth is, that’s a hard gear shift.

You’ve got year-end bills, tax thoughts in the back of your mind, maybe a few jobs you’re trying to squeeze in, and then on top of that, you’ve got family events, travel, gifts, and all the extra holiday pressure.

And this is when the “autopilot” kicks in, right? You just keep grinding because that’s what you do.

Which is why this is actually the perfect time to talk about Rung 1 of the BuiltWealth™ Ladder: when all your eggs are in the business basket.

 

Why Rung 1 is so common (and why it makes sense)

Most business owners don’t wake up thinking, “I want concentrated risk.” They wake up thinking:

• “I’m building this thing for my family.”
• “I’m reinvesting because that’s how we grow.”
• “I’m trying to stabilize cash flow.”
• “I’m trying to hire the next person so I’m not the one doing everything.”

And reinvesting is often the right call. 

In the early chapters, the business is the best engine you’ve got. It can produce returns you’ll never get in a basic investment account.

Here’s the catch: when the business is the only engine, it becomes the only answer to every question. 

Need a new roof at home? The business has to have a good month. 

Want to take a real vacation? The business has to “allow it.” 

Want to retire? The business has to sell, at the right time, for the right price, to the right buyer, with the right tax outcome.

That’s a lot of pressure to put on one asset. Even a great asset.

 

The hidden problem: you and the business are financially glued together

On Rung 1, your personal financial life and professional financial life are often intertwined in ways that feel efficient, but can get fragile.

You might recognize some of these patterns:

• Personal spending floats up and down with the bank balance.
• Taxes feel like a surprise, not a system.
• Insurance and risk coverage is “good enough” until it isn’t.
• The business is the retirement plan.
• The “plan” is mostly in your head, not on paper.

And because you’re busy, you can slip into autopilot. Work becomes the default setting.

So the business keeps getting fed first, and everything else gets leftovers.

 

The core idea of Rung 1: Build a second engine

Here’s what we do on Rung 1, and it’s simple conceptually, even if it takes discipline to execute:

 

We balance reinvesting in the business with building independent wealth outside the business.

I like to call it building a second engine. Another source of wealth creation that does not depend on next month’s revenue, the next hiring decision, the next big job, or the next economic dip.

That second engine can include things like:

• Diversified portfolios (not exciting, but steady, and they compound quietly)
• Retirement accounts (the “boring” stuff that works if you keep feeding it)
• Real estate (when it’s done intentionally, not impulsively)
• Cash reserves and liquidity planning (so one bad month doesn’t create five bad decisions)

And notice what I didn’t say: I didn’t say you stop investing in the business. The business is still the primary engine on Rung 1. We’re just not letting it be the only engine.

Because if you don’t prioritize your life and your long-term plan, somebody else will, right? 

Usually the urgent stuff.

 

The big Rung 1 question (and it’s a gut-check)

If you only ask yourself one question this week, it’s this:

 

If my business hits a rough patch tomorrow, what part of my financial life breaks, personal and professional?

That question reveals your real dependencies.

Maybe the answer is:

• “My mortgage payment breaks.”
• “My tax payment breaks.”
• “Payroll breaks.”
• “My spouse’s confidence breaks.”
• “My sleep breaks.”
• “Everything breaks.”

And so, yeah, that’s a lot to think about. But it’s also powerful, because now we’re not guessing. We’re looking at the facts of reality, and that gives us options.

 

Moving up the ladder: What “progress” actually looks like

So what does it mean to move up from Rung 1?

It means you start separating you from the business in a healthy way. You stop treating the business like the only safety net. And you start building that second engine consistently.

Here’s the practical move you might want to make, and it doesn’t have to be dramatic:

 

Talk to your accountant and/or financial advisor and ask two questions:

• What do I have in place now as my second engine?

Retirement accounts, taxable investments, real estate, cash reserves, anything outside the business.

• What are my best options to start building a better second engine, given my cash flow and tax situation?

This is where the details matter: entity type, income level, tax strategy, and how much you can feed the engine without starving growth.

And as you do that, you’re not just “saving money.” You’re building optionality.

Because the end game is this: By the time the exit comes, financial independence isn’t riding only on the sale. If you sell, great. If you don’t sell, you still have a plan. If the industry changes, you still have a plan. If you get tired, you still have a plan.

 

If you’re on Rung 1, here’s your takeaway

So if you’re reading this and thinking, “Yeah… that’s me,” good. You’re not behind. You’re just on a rung.

Rung 1 is the season of building. It’s where most great owners start. But the move that separates the owners who stay stuck from the owners who climb is this:

 

Understanding that Rung 1 is not a problem, it’s a starting point.

Most entrepreneurs build wealth the same way they build great companies: one good decision at a time, repeated. 

And building a second engine is just that, a repeatable decision. You’re creating stability outside the business so you can run the business with more confidence, not more fear.

So take a breath heading into the holidays. Enjoy your people. Let your brain shut off for a minute.

Then, when you come up for air in January, let’s get clear on the one or two moves that start separating you from the business, so your future isn’t riding on a single outcome.

It’s built on a solid foundation.

 

If this hit home and you want to get a clearer picture of where you are on the BuiltWealth™ Ladder, subscribe to our weekly newsletter here. No pressure at all. Just something to help you think through your next move.

 

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HFM Investment Advisors, LLC is a registered investment adviser. All statements and opinions expressed are based upon information considered reliable although it should not be relied upon as such. Any statements or opinions are subject to change without notice. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. All investments involve risk and are not guaranteed. Information expressed does not take into account your specific situation or objectives and is not intended as a recommendation appropriate for any individual. Listeners are encouraged to seek advice from a qualified tax, legal, or investment advisor to determine whether any information presented may be suitable for their specific situation. Past performance is not indicative of future performance.