Friday, September 27, 2019

What to Consider in Your Budget When Deciding to Start a Business

This post may contain affiliate links. This post was written for the Not Entirely Perfect audience.

As with any area of your life, you need to consider your budget and finance plans when it comes to starting your own business. Whether this is a simple home-based freelance role or a start-up business that you’re hoping to build on a wider scale, budgeting from day one is key. It’s also a good idea to form a budget for your personal lifestyle, too. If you are funding your startup business yourself from scratch, there may be cutbacks you need to make in your own lifestyle in order to have the spare money needed to get your business off the ground. Starting a business is, therefore, the perfect opportunity to declutter and incorporate minimalism into your lifestyle, too. 

So, which areas should you be thinking about for your business budget? 

Your Existing Finances and Income Source 

Have you saved a bulk amount for starting your business and purely going to be using these savings to provide for your work? Or, do you have an alternate source of regular income whilst you are building your side business? Before budgeting, you need to be clear on the amount of income you have to depend on both in the first instance and on a monthly basis. This will allow you to see how much you have available to you. 

Are You Intending to Invest in Consulting and Training Services? 

Perhaps, you’re looking for as much help as you can get in the beginning, and this may come in the form of professional training services and consultants available to offer advice. Trainers like Toni Vans can assist with all methods of marketing and getting your business off the ground, so this could be a worthy investment if it means increased revenue at a quicker pace. Consider whether your budget allows for an expenditure like this, and if so, the positives of doing so. 

Is There Anything You Could Cut Back to Release Extra Funds? 

Perhaps, if you’re starting a home business, you no longer have need of a personal vehicle in order to commute for your work. If this is the case, you could consider eliminating the car expenses and selling the vehicle in order to free up that money to put into your business instead. This logic is applicable for any area of your lifestyle. For example, do you no longer need to wear business clothes or suits if you are working from home? Does this mean you will have extra money usually spent on workwear? Every little helps. 

Determine Fixed and Variable Costs 

These costs should always be considered in an overall budget. Fixed costs include those business necessities that are at a fixed price, such as the cost for renting office space or an internet service charge. Variable costs include those elements that could fluctuate month to month, such as utility bills. When devising a budget for the latter, try to plan for the maximum you can afford and devise a way that will allow the bills to never go over-budget, such as how you can limit energy bills.
Copyright © 2012-2020 Not Entirely Perfect
Design out of the FlyBird's Box.