Ditching 9 to 5 job, saying goodbye to “yes sir”, “no sir”, and being your own boss is one of the most exciting things. But the risk factor involved in being an entrepreneur is what makes people reluctant to start a business of their own. Even those who do give entrepreneurship a try hardly see the dawn of success. Well, we are not talking about launching something as big as Google or Uber, but running a small business is also a difficult affair. Businesses not only have to look for ways to survive in the competitive market but also have to deal with the staggering financial condition. Things get even worse when something unexpected is tossed on the way. But it doesn’t mean that you shouldn’t taste the sweetness of being self-employed. Developing the right tactics and plans can save you from a bumpy ride of self-employment.
Here are given some finance management tips that can successfully sail your boat of finance during struggling phase of your business:
Separate Personal and Business Finances:
The first and basic thing you should do to manage your finance is to keep your personal and business finance separate. Make separate accounts and expenditures list so that you can track your finance and record expenses properly. It will also help to do proper budgeting and decide where you can cut your expenses to invest more.
Buy an Insurance:
If you have set up a company and hired employees, then buying insurance becomes inevitable because you never know when things might go wrong. Leaders in the insurance business, like https://kaseinsurance.com/, say that businesses have to face unexpected lawsuits due to employee injury or contract issues with clients. In either of the case, they have to deal with a huge financial blow without any insurance plan. If you are working all alone as a freelancer, then you might not need an insurance plan. But if you have a setup, then insurance plan is essential to save from unexpected financial problems.
During the initial phase of your business, when you are struggling to manage finances, it becomes hard to hire employees. But obviously, you can’t run a company without hiring employees as you can’t be a one person show. The best way to handle this situation is by hiring multitaskers who can perform more than one job to limit the employee span. Like, you can hire a person who can perform the duties of an admin officer as well as HR manager. Similarly, you can look into other job areas which you can assign to one person to lower expenditure on too many salaries.
Create an Emergency Fund:
Budgeting for a startup is never complete without creating an emergency fund. Though emergency funds are essential for every business, it becomes a lifeline if you are new in the business. Startups have high finance fluctuation rate that can only be saved if you have an emergency fund. Your clients can run away, orders can stop in the middle, your key employee can quit, or system can shut down due to some reason. All these situations can place you in an aggravated financial condition. However, things will be saved if you have emergency funds!