Podcast Episode 43: How To Be A Financially Fit Entrepreneur
Building a business takes a lot of sweat, tears and money. Unfortunately, many entrepreneurs risk their finances for their business ventures.
Sometimes, entrepreneurs have to invest in their businesses for a number of years before they even see a return of investment. However, during that time, life expenses take place each month and at times we underestimate how much money is required to get a business up and running and for it to provide for your family.
I believe it is possible to be financially responsible while growing your business.
Below are five ways you can grow your business while remaining financially fit:
Keep Your Day Job For As Long As Possible
I know this may not be a popular advice in a day and age when everyone always talks about leaping and slaying it as an entrepreneur, but you have to assess not only your financial situation but also how long it may take you to bring your business up to speed. Many entrepreneurs underestimate how long it takes to replace your income with your new business. The learning curve could take months if not years and your revenue may not be high enough to support you and your family. Take your time and learn your business as a side hustle without the financial stress.
2. Keep Up Your Savings Plan...No Matter How Small
It’s very important to take advantage of time in regards to investing. The longer we put off investing in the stock market, the longer it take for us to reap the return. Although your business may require money, if you keep saving, even a small amount, you can benefit from it years to come.
3. Pay Off Your Debt
It’s true, that the less debt you have, the more cash flow you have available to run your business and the faster you side hustle can be your main occupation. Also, the lower you debt the less personal expenses you have to manage as your business grows.
4. Trim The Fat From Your Lifestyle
Think of your business as new dependents that you have to take care of going forward. Look at your expenses and find ways you can scale down while growing your business. Maybe you may decide to hold off on certain expenditures such as a new car, a larger home, those frequent coffee trips, or shopping less frequently. Don’t worry, your day will come.
5. Focus on Making Twice Your Salary
I hear a lot of entrepreneurs desire to replace their salary, but I think the rule of thumb is to make twice your salary. When you are growing a business, there are so many unforeseen expenses. Also, your revenues may take a number of years to stabilize. It will be much easier to learn and grow your business without the added financial stress.