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5 Money Habits Every Business Should Start Now

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Are your company’s finances trapped in a rut? We frequently become so comfortable with our financial routines that we forget there are fresh things to attempt. Our system becomes stagnated, and we wonder why our finances appear to be dormant.
This year will be different! Now is an excellent opportunity to establish new financial habits for your company. Try incorporating these money habits gradually or completely overhauling your financial strategy. You might be shocked by how easy these money habits are, yet they can have a significant impact on how you handle your business and finances.

Here are my top money habits to implement right away to help your business succeed:

  1. Schedule invoice due dates on your calendar.
    Raise your hand if you’ve ever experienced the following: You send a bill to a customer. You get busy with the next project, and being the badass that you are, you immerse yourself in it. You complete the project, send the invoice, and then realize, “Hey, that other person never paid their invoice, and it’s 30 days overdue!”

    If your business is experiencing cash flow problems, adding invoice due dates to your calendar is essential. It’s a must-have if you’re easily distracted or jump from one activity to the next.
    One of the main reasons small businesses are cash-strapped is because their inflow (what they get paid) isn’t keeping up with their outflow (what they spend). This is because individuals are slow and frequently require multiple reminders before paying.

    Adding invoice due dates to your calendar allows you to stay on top of the laggards and pull their sluggish buttocks along when cash is needed. Extra points if you include a late fee in your invoice so that when the due date has gone, you may send them an updated invoice with a fee for your trouble.
  2. Take 30% off anything you earn.
    Do you ever notice how when you’re self-employed, you feel like you’re making way more money than when you’re working for someone else? Every day, large sums of money are deposited into your bank account, and the mood is festive.
    Except I’m afraid I have some sad news for you. That generous sum of money isn’t entirely yours. In fact, at least 30% will be paid to the IRS when tax season arrives.
    Consider the 30% before going on a purchasing frenzy to avoid significant disappointment later on. Although you are only taxed on your net income (what you make after costs), it is still a good idea to deduct 30% of your gross income just to be safe.

    This is especially crucial when it comes to business planning. Many people will set financial objectives and make plans to expand their business without considering taxes.
    Add this money habit to your routine–automatically (at least mentally) deducting 30% of your earnings–so you’re not dancing to small violins at tax time.
  3. Pay off your debts first.
    I’m sure there are a million things you’d rather spend your money on than debt. And it’s difficult to take yourself away from all the enjoyment in order to repay the money you’ve already spent. But… debt is a very real part of life that must be addressed sooner or later.
    Prioritizing your debt may not make you feel great, but it will help you develop a solid financial foundation for your business. You see, your company isn’t a one-time event. It’s something you’ve been working on for a long time. And you want to train it to stand on its own two feet, tall and powerful.
    Allowing debt to accumulate just makes it more difficult to get your business back on its feet.
    Begin looking for ways to reduce your debt, even if it means deferring the purchase of that new and shiny gadget or software application. It’s all too easy to get caught up in the “But if I buy this for my business, it will help me make more money” cycle.
    Consider this if you are drawn into this line: Whatever you decide to purchase is not guaranteed to help your business thrive. What is certain to benefit your business? You’re paying off your debt.
  4. Before you spend, check your budget.
    Your budget exists for a purpose! So many people spend a lot of time fine-tuning their budget only to squander it when the next enjoyable thing comes along. Having a budget is not the same as really using one. And using a budget can assist you in managing your cash in your organization.
    Consider your budget to be a road map for your expenditures. That is, before you spend money on something, examine your map to ensure you are heading in the proper way.
    Also, just because you don’t agree with what your budget says doesn’t mean you shouldn’t pay attention to it. You may have to grow used to not hearing what you want in order to better control your spending and align it with your goals.
    If you are particularly prone to going over your budget, consider compiling a list of everything your budget allows you to accomplish. Perhaps it’s saving for a vacation or simply being able to pay yourself enough to live on without feeling stressed.
    Check your budget first, then read over your goals list to remind yourself what’s actually important when that new item comes along.
  5. Save the money you make from unexpected projects.
    It’s the best feeling in the world when an unexpected project or client falls into your lap. Our natural tendency is to reward ourselves for this modest victory with something lovely.
    Now, I’m all for celebrations and incentives, but one of the most effective saving tactics I’ve discovered is to save all of the money I receive from unexpected projects (i.e. those that aren’t budgeted for in my income). People frequently ask how I can afford to travel or save as much as I do, and the answer is that I view odd jobs or clients to be savings opportunities.
5 Money Habits Every Business Should Start Now2

Usually, I’ll take a small amount to have some fun with (since what’s the point if we’re not having fun with our money?) The remaining 90-95% is put into savings. This method has allowed me to go to Hawaii, Vietnam and Cambodia, New York, Puerto Rico, and Portland just this year. Using this technique, I’ve also met my business savings objectives, tax savings goals, and personal savings goals.

What’s the best part? Nothing in my regular financial situation needs to alter. It’s money I didn’t expect to make, therefore my personal and corporate budgets will remain unchanged.

What financial habits are you hoping to establish this year?

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Vernita Green

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