5 Steps to Tame the Cash Flow Rollercoaster and Achieve Financial Peace

If you’re like many architecture and engineering firm owners, you’ve likely felt the stress that comes with the cash flow rollercoaster: some months, cash is pouring in, and other months, you’re scrambling to pay bills. That unpredictability can make it tough to plan for the future or even feel confident in your day-to-day operations. 

The good news? 

You don’t have to live like this.

In this post, we’ll go through five practical steps you can take to smooth out the ups and downs of cash flow, so you can have more clarity and stability—ultimately bringing you closer to Achieving Financial Peace.

Let’s dive into how you can start taming that rollercoaster ride today.

1. Bill on a Percentage of Completion

One of the easiest ways to create consistent cash flow is by changing how you bill clients. Instead of waiting until a project reaches a specific phase, consider billing based on the percentage of completion.

Here’s why: When you invoice at the end of a phase, you’re often left waiting to finish the phase before you can send out another bill. But if you bill based on completion, you have the flexibility to bill as much or as little as you want—whenever it makes sense for you and your client.

This method helps create a steady flow of income, even on long-term projects where waiting for completion can create financial strain. Plus, it puts you in control of your cash flow, rather than being dependent on project milestones that may change.

How This Connects to Financial Peace

By implementing this method, you're creating predictability in your business, which leads to peace of mind. Cash flow predictability is a cornerstone of financial peace. Consistency means fewer sleepless nights worrying about income, allowing you to focus on growing your business with confidence.

2. Develop Recurring Revenue Streams

In architecture and engineering, recurring revenue can seem tricky, but it's not impossible. You can still develop recurring income by diversifying your service offerings and staggering projects at different phases.

Here are a few ideas:

• Consulting Retainers: Offer clients monthly consulting services or project management support. This keeps you engaged with clients while providing consistent revenue.

• Design Audits or Reviews: Provide ongoing design reviews or project audits at scheduled intervals throughout the year.

• Small-Scale Projects: Take on smaller, more frequent projects like feasibility studies, site evaluations, or initial design consultations that can provide regular cash inflow while you work on larger jobs.

• Repeat Customers: Focus your marketing and sales efforts on customers that will lead to repeat business.

Recurring revenue means less stress about where your next paycheck is coming from, and it’s a great way to fill in the gaps between big projects.

How This Connects to Financial Peace

Building multiple revenue streams is a form of diversification, which is crucial to a strong financial foundation. It reduces reliance on a single income source, creating financial stability. With steadier income from different sources, you’re better equipped to weather slow periods without worry.

3. Create Multiple Savings Accounts for Different Purposes

A single business savings account is good, but why stop there? Taking a cue from the Profit First model, setting up multiple savings accounts for different purposes can give you even more control over your finances.

Here’s how to structure it:

• Tax Account: Set aside money each month specifically for taxes so you’re not scrambling to find funds when tax season hits.

• Profit Account: Allocate a portion of your income for profit. Yes, this is money you get to enjoy! It’s important to reward yourself for your hard work.

• Reserve Account: Build a reserve fund for those unexpected business expenses or downturns in revenue. Aim for at least three to six months of operating expenses.

• Expense Planning Account: You know those big, annual expenses like software renewals? Plan ahead by setting aside a small amount each month. You can even spread these costs over time using a credit card or payment plan, so they don’t hit all at once.

By organizing your finances into specific accounts, you take the guesswork out of saving and ensure you’re always prepared, no matter what comes up.

How This Connects to Financial Peace

This approach gives you a sense of control and security—two things that are key to achieving financial peace. It ensures you’re prepared for taxes, large expenses, and emergencies, so nothing catches you off guard. This strategy focuses on planning ahead and reducing financial anxiety.

4. Plan Ahead for Big Expenses

As a firm owner, you know big expenses are inevitable.

So, why let them surprise you?

Annual software renewals, equipment upgrades, and even employee bonuses are predictable costs that can wreak havoc on your cash flow if you don’t plan for them. The key is to spread these expenses out over several months so that when the time comes, the money is there, and it doesn’t feel like a financial hit.

Here’s what you can do:

• Create a monthly savings plan for known annual expenses like software or insurance premiums.

• Use payment plans when available, or charge annual expenses to a business credit card to spread the cost over time.

When you plan ahead, there are fewer "surprise" expenses. Everything feels manageable because you’ve built these costs into your monthly budget.

How This Connects to Financial Peace

Being proactive rather than reactive gives you control over your business finances. When you’re no longer caught off guard by predictable expenses, it frees you up to focus on what really matters—building your business and your wealth. Financial clarity leads to financial peace.

5. Use Cash Flow Forecasting to Stay One Step Ahead

This one is key. Cash flow forecasting is a game-changer when it comes to smoothing out the highs and lows of your business income.

By creating a cash flow forecast, you can:

• Predict income and expenses for the upcoming months, helping you see potential gaps before they happen.

• Plan for lean months by shifting project timelines, adjusting expenses, or ramping up marketing efforts to bring in more work.

• Adjust quickly: If you know a slow period is coming, you can plan ahead by building up your reserve or delay billing for an existing project.

For example, let’s say you’ve forecasted that next month will be slow because a large project is wrapping up, and another hasn’t started yet. Knowing this, you can push for early billing on the project nearing completion or focus on winning new business to fill the gap.

How This Connects to Financial Peace

With cash flow forecasting, you’re not just reacting to your finances—you’re controlling them. The ability to predict and manage your cash flow helps you avoid stressful surprises and aligns with proactive financial management. Financial clarity equals peace of mind.

Achieve Financial Peace by Taking Control of Your Cash Flow

The key to taming the cash flow rollercoaster is creating consistency and predictability. By implementing these five steps—billing on percentage of completion, developing recurring revenue streams, creating multiple savings accounts, planning for big expenses, and using cash flow forecasting—you can smooth out the ups and downs of business and achieve the financial peace you’re aiming for.

This is all part of The Wealth Blueprint: building a financial structure that gives you clarity, confidence, and peace of mind, so you can focus on what really matters—growing your business and living the life you want.