USING BEHAVIORAL SCIENCE TO DESIGN A CUSTOMER-CENTRIC FINANCIAL MANAGEMENT TRAINING FOR MICROENTREPRENEURS Appendix A: Financial Heuristics Curriculum: Key Topics Cash Separation • Introductory Message to Cash Separation with Client Testimonial ▫ Introduce the cash separation topic and share the usefulness of tips offered in this module with a testimonial from a small business owner practicing these tips. • Financial Heuristic 1: Choose two different physical locations to keep your business and household cash, and do not mix the two. ▫ Why: Separating the business and household cash allows you to know how well your business is doing. • Financial Heuristic 2: Pay yourself a fixed weekly salary—take out a fixed amount of money at the beginning of each week from the business cash place and put it into your household cash place. • Financial Heuristic 3: You can calculate the right level for your weekly salary by making a list of all your typical personal and household weekly expenses. The sum of your weekly expenses is your weekly salary. ▫ Why: You will know how much money your business makes each week, and how much household expenses you can usually afford in a given week. • Financial Heuristic 4: Remember to always count your profits after paying yourself a salary and paying for your weekly business expenses. ▫ Why: This way, you will know how well your business is doing. A healthy business should have good profits. Now that you know how your business is doing, in the coming weeks, we’ll provide you with more tips about how to further improve your business. • Financial Heuristic 5: You can spend money for the household needs only from the money you put into the household cash location. In case of a business (or household) emergency, you can take a “loan” from the household (or business) cash location to the business (household) cash location, but make sure to return it to the business (or household) location within seven days. ▫ Why: If you regularly run out of money in the business cash location, this means that your business is not making enough money for your household. • Cash Separation Module Recap: The easiest way to know your business profits is to follow the three easy steps on cash separation. At the end of the week, the money left in your business cash location is your business profits. ▫ Keep two separate locations for business and household cash. ▫ Pay yourself a fixed salary. ▫ Do not mix cash from the two places. 29