Managing your money when you’re self employed is all about making smart decisions. You need to have discipline, and you need to have a solid plan in place so that you stay motivated to keep your finances under control. Below, you’ll find a few ideas that will help you to manage your money when you’re self employed.
Create A Budget You Can Stick To
Start by creating a budget you can stick to. Always work out what your bills cost first and make sure you leave that amount in your bank. Have them come out as direct debits so you don’t even need to think about them. You’ll then need to allocate yourself money for things like food and fuel.
Save An Emergency Fund
Saving an emergency fund should be at the top of your to-do list when you become self employed. Ideally, you will have done this already. If not, don’t panic; just commit to doing it now. This will help you should you need emergency funds. Maybe you have an expensive car repair to make, or maybe you lose a big client. Save 3-6 months living expenses and leave it alone.
Put Money Aside For Your Tax Each Month
Put money aside for your tax and keep accurate records right from the start. Know exactly what you can claim for so you don’t pay more than you need to. Get an accountant if possible!
Find Smart Ways of Saving Money
There are all kinds of smart ways you can save money. Use cashback sites whenever you shop, and always look for discount codes. Get an eco friendly second hand car from a place like Belmont Autos so you’re not spending a ridiculous amount of money on driving. Don’t impulse spend. Make swaps in the supermarket, cut your TV package, and swap utility suppliers if you find a better deal. Keep an eye on your budget and know when to make a change!
Be Very Careful With Credit Cards
A business credit card can be very helpful, but you need to make sure you’re not going overboard. Be prepared to pay back what you spend as soon as possible. They can be helpful for keeping your business expenses all in one place, but it can also be tempting to spend more than you’ve got.
Pay Yourself First
Pay yourself first, and put any extra you’ve made into a pot for months when you may not earn as much. Be smart – don’t go out and buy something extravagant.
Plan For Retirement
Getting into this habit as early on as possible will ensure you can live a comfortable life. Never rely on a state pension.
Get Insurance
What would you do if you fell ill and couldn’t work? Insurance is the only way you can protect yourself. This is especially important if you have people who depend on your income!
Managing your money when you’re self employed is a habit you should get into as soon as you can.
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