The trick to financial planning for new entrepreneurs is to learn how to manage your finances or you’ll feel it in your pocket. Especially since as a new entrepreneur money is still too tight to mention. As you’re still getting the business up and running whilst having to live off your entrepreneurship and pay the bills.
And since being a new entrepreneur means saying goodbye to that guaranteed end of the month paycheck. You will need to practice thrift and make sacrifices along the way if you expect to see a dime in your pocket. Here are 4 tips on financial planning for new entrepreneurs.
- Consult the insights and expertise of an experienced financial advisor
If you know you are not good at managing your money get someone who is to assist you, such as a team of financial professionals. A financial planner, accountant, and a tax attorney communicate with them and use their services.
- Keep business and personal finances separate
To prevent dipping into your business account and running out of funds. Also having a separate business bank account will prevent confusion when it is time to pay bills or payroll. In addition, it is vital to incorporate your business as a separate entity. If you do not, you risk losing personal assets if you get sued.
- Hoard your savings before opening a business
It is good to have some savings money stashed away before you even consider taking the leap to entrepreneurship. So you can be prepared for the time between starting up and making a profit, and 12 to 24 months of savings should do.
- And lastly continue to save, save, save
Save when you can, for when you can’t. This cannot be stressed enough for new entrepreneurs as your savings can save you and your business financially, especially when last minute business expenses pop up. Such as you might be in need of new office equipment whether a printer or computer or maybe you run a delivery company and your delivery van breaks down.