Like many new young entrepreneurs, three years ago I thought I was pretty hot stuff. I had a few employees, raised some angel money... and then proceeded to make huge mistake after huge mistake.

Of all my business blunders, these 7 are the ones that still make me gnash my teeth.

1) I Managed People like Michael Scott from “The Office”.

Many entrepreneurs are terrible bosses. Some of us simply cannot manage people well. We get stuck thinking that our “one great idea” will carry our business into "multi-millionairedom". While that may be the case on rare occasions, the majority of successful businesses are built by a smart, efficient and motivated group of employees, not just one person.

Growing a business beyond your own skills is vital if you ever wish to sell your company. You can only make so many sales calls in a day! If you want your business to hit the next level, you need other workers and you need to know how to lead and inspire them.

The good news is that this skill can be developed. If you've never had an employee before, try hiring a local college student on a part-time basis to get your feet wet.

Oh, and don't hide out in your office all day. It doesn't work.

2) I Hired My Friends.

Do not hire your friends. Especially in a start-up situation, you do not want to be your friend's employer. Having to lay off a friend of mine was one of the worst experiences I've had as an entrepreneur.

Also, you should almost never be the “boss” from 9-5 and “friend” again outside of work. It's too hard and really an inappropriate burden to put on yourself and your friend (no matter how many times they beg you to hire them!) I wouldn't even recommend going into business with a friend.

3) I Budgeted Like Britney Spears: Terribly.

You don't even have $100,000 in sales yet, so why did you just hire that fancy-pants PR firm? One critical mistake many new entrepreneurs make is thinking that just owning a business makes them a success. Wrong! Fail! Try Again!

An ergonomic chair that costs a thousand dollars does not make your business successful. That big office with a plasma TV and PS3 for your one employee does not make you a success.

Profits and positive cash flow are the marks of a truly successful business. Spending just to look successful or “big time” is what wanna-be entrepreneurs think is success.

4) I Leased A Fancy Office While My Large Basement Went Unused.

I thought I had to have a nice office for my business, even though we never had clients visit. It was a complete waste of cash, my most precious resource.

When you are first starting out, there is no better office than your basement or living room. Your parent's basement is even better: cheap rent, good food, and if you're lucky your Mom might still do your laundry.

Honestly though, for most software or web start-ups there is no need for an office in the early stages. The longer you can go without an office, the better. Investors love frugal founders, so if you plan on raising money for your business, stick to the home office as long as possible.

5) I Raised Money Before I Had Customers.

Raising money with just a “business plan” is not the best idea.

Do whatever you can to launch your business without raising money from outside investors. I don't care if you have to live on rice and beans for a year. Do it. A year down the line when you have a sick cash flow positive business that you own 100% of, you'll thank me.

If you do need to raise money, do so after you've already proven your business even if only on a very small scale. You'll get a much better valuation for your business as well as give investors more confidence in your business acumen.

6) I Mixed Business with Pleasure.

Have a separate checking account for your business. Never, ever, mix your business expenses with your personal life. It's a recipe for disaster.

7) I Assumed Everything Would Go According to Plan.

For the entrepreneur, realistic optimism can be good, but having optimism just to make things feel better can be deadly. If you are unable to see potential flaws or downfalls in your business, you must recognize and plan for them.

Bring in a partner or trusted mentor who can keep your optimism in check. I've seen too many entrepreneurs (myself included) get absolutely crushed when their business doesn't pan out the way they had hoped.

A few other mistakes I made:
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• Not utilizing open source software. Don't pay a web designer to build your site from scratch. Have them install a content management system like WordPress and then have them design a custom theme. You'll save thousands.

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• I “over-planned” my business. It's good to have a business plan, but it’s better to have a plan that you actually take action on and can then translate into actual results and sales.

Next week I'll share the top 7 things I did right as an entrepreneur. Make sure to subscribe so you don't miss it!

What mistakes have you made make you gnash your teeth?

There are many ways for you to start saving your money; some work, most don’t. Especially if you come from a family and background where nobody saved and that was not an integral part of dealing with money. One way to force yourself into saving is by having the government help you with it. This tip might not be for everybody, but if you are having a hard time saving money, it might do the trick.

When signing up for a new job, you always fill out a bunch of papers and sign many dotted lines. One of the forms you fill out is a tax withholding form. This is where you enter your number of exceptions and indicate if you want extra money taken out of your paycheck, so that at the end of the year you will not have to owe money to the government.

By entering a bigger amount into this “extra withholding” section, your employer will take out that amount from your paycheck and send it to the IRS. Then next year, after submitting your taxes, you will receive a bigger refund. The extra amount that you chose to be withheld from your paycheck should be there from the entire year.

Take the refund check and forward it to whoever handles your savings or investments, such as companies like Schwab and ING Direct. You can also fund an account with a social lending site and lend it out to other people while you earn interest.

The downside of this savings method is that you will miss out on the interest that you might have earned during the year by saving or investing this money yourself. This is a decision that you will have to make: is it worth it for you to lose interest dollars to be able to have the money saved in one lump sum at the end of the year, or are you diligent enough to save it yourself on a regular basis? Look at your history and past actions and let them guide you, not what you think you will do.
Caution: Please review your previous tax returns and talk to your accountant to make sure that this method doesn’t have any negative consequences for your particular situation. (It shouldn’t, but having that OK is always good.)

The recent heat wave in the Midwest, earthquake near Los Angeles, and signs that hurricane season has begun all remind us that there are many ways the weather can impact your budget. Weather-related expenses should certainly be part of your plan.

While natural disasters might seem like the main cause of weather-related costs, less dramatic weather can cost you more as well. The effects of an unusually hot summer or unusually cold winter also can be devastating.

Emergency funds are a great way to handle unexpected expenses. Building up a cache of 3-6 months’ worth of expenses is widely advised by those in the financial planning realm. This is certainly good advice that I also recommend. You have to remember, though, that some emergencies are hard to identify. Higher electric or gas bills due to an extended heat wave or cold snap are emergencies, but they are just spread over a longer time period and don’t have a defining event, such as many other natural disasters.

You may choose to simply plan to have some higher weather-related costs at some point during the year instead of using your emergency fund to cover such expenses. I’ve noticed that my water, electric, and gas bills all swing wildly throughout the year, but the total of the three bills tends to be fairly constant. I use the most gas in the winter, the most electricity in the summer, and the most water in the spring and fall. By budgeting for these items in combination, I see fairly consistent costs each month and can easily identify any time I have a large jump in the group. Padding this budget item by 10% also allows me to handle such jumps without having to dip into my emergency fund.

Like most aspects of budgeting, investing, and saving, planning ahead for weather-related costs makes their occurrence almost a non-issue. If you get lucky and get through a year without any such costs, you’ll have some surplus funds in your budget and if the weather inevitably does cost you, you’ll be ready for it.

Groceries tend to be one of the largest expenses in household budgets. Cutting back and using cost-saving measures can help a lot, but so can planning out your meals ahead of time.

Planning your meals basically means deciding what to eat far enough ahead of time that you can save money. As we all know, impulse buying and more trips to the store end up costing more. Paying convenience store prices is also a real budget drain. Planning your meals can eliminate, or at least reduce, these wastes of money.

Meals can be planned around a weekly shopping trip. Even if you’re not a coupon clipper, the supermarket’s weekly advertisement will tell you what’s on sale for the week. Seeing the sale items may inspire you to try a new dish or remind you of an old favorite. As you become familiar with prices, you’ll also be able to spot the really good deals. When these come along, you can stock up on the product of interest.

Having to plan ahead may sound limiting, since you might feel like having a steak one night even though a pasta meal is planned. Rather than planning which meals will be for which nights, you can simply ensure that you have sufficient meals to cover each of the days you are shopping for. Then you can decide each morning what you’ll prepare that day. We also like to keep our family schedule in mind when shopping. That way we’ll buy meals of varying preparation time to cover busy nights with limited time as well as leisurely nights where more preparation time is available.

By investing in sale items, reducing the total time spent grocery shopping, and eliminating wasteful spending habits, you stand to greatly reduce one of your larger expenses. The variety and improved healthiness of food choices is an added benefit. Couldn’t your household benefit from planning your meals as well?

Spring-cleaning may be better known, but a summer spruce-up can be just as effective. Evaluating your belongings and performing certain cleaning tasks are easier in different seasons.

Over a recent weekend, we performed a summer spruce-up in our house. It wasn’t a top to bottom cleaning like the one we do in the spring, but was nonetheless quite productive. We mainly cleaned out closets and the garage. De-cluttering closets can be a little bit frustrating because after the work is complete, a closed closet looks the same as if you hadn’t done any work. Knowing that the extra space you created could then be used to de-clutter the visible areas of your living space is decent consolation.

To give you an example of how time of year can affect your cleaning, consider the college textbooks that we found in some of the boxes. Selling books online in the spring is highly competitive because so many college students are finishing their classes and selling their books as well. Selling books now, closer to the start of a new semester was much more profitable. Other tasks can have similar benefits. I wouldn’t sort through my winter clothes now, because my use habits on those items aren’t fresh in my mind. But I was able to decide which of my summer clothes are being used and which could be donated.

By evaluating each item encountered in our spruce-up effort, we could decide whether it would go to the best use by selling it, donating it, or in some cases throwing it out. In the end, we had two carloads worth of clothes and items to donate. While that will lead to a small tax deduction, we also earned some real cash by selling some of our other items online. Even those few items that couldn’t be sold or donated freed up some extra space in our home, which has a value all its own. Could your home benefit from a summer spruce-up as well?