These 7 tips will allow you to make sure that your finances are in order before continuing to expand your business. Put them into practice and ensures your economic stability (and also the emotional).
1. Educate yourself
Take the time to read about personal finance. Each week, calendar appointments "of money" with yourself and dedicated several hours to manage your personal finances, and read books, magazines, websites or blogs of finance. Know more about your own finances, greater confidence will have to manage your money in the long run.
If you need more help, consider hiring a business coach that will help you create a financial plan to achieve your goals.
2. Check your credit regularly
Your credit report is like a file of you and your credit history. Basically tells lenders how risky as you are, and whether or not to lend you money. When it comes to buying a car or a House, it is desirable that your credit report is in excellent form, so that you can qualify for good rates.
Create the habit of checking your history at least once a year to confirm that everything is in order. Do it on a special date (such as your birthday) so is it makes you easy to remember it and maintain the monitoring.
3. Get a quote
Although this sounds very basic, many entrepreneurs do not have a budget to monitor your income and monthly expenses. You can use digital tools as apps to monitor your personal finances or simply a document in Excel. No matter which option you choose, make sure that it fits your lifestyle.
If you really want to arrange your finances and ahead financially, you must devote time and energy to update your budget every week. This will help to ensure that you do not spend more of what they earn and that you are able to save for your financial goals.
4. Automate your finances
Technology greatly facilitates the task of managing finances every day. Find that most of the process is automatic. You can use automatic transfers online or pay your bills online each month. This will help you to generate interest or charges extra and not you stresses you by paying your bills on time.
If you're concerned about automating the payment of your accounts, you can set alarms in your calendar (on your computer or smartphone) that remember you to payment. The more you can automate your finances, less worry you'll have on a daily basis.
5. Pay debts
Make a plan to pay off all your debts as soon as possible. Start by making a list of all your debts (credit cards, credit car, education credits, etc.). It includes the current balance, the minimum payment per month and the interest rate. Then check your budget to determine how much money you can add to debt payments.
From there you can do research on strategies to reduce debts so that you confirm that you are paying them in the most efficient manner possible. When you're working on a debt reduction, it is important to have a "cushion" to pay for any emergencies that arise along the way.
6. Build your own mattress
Having a cushion of money is an essential part of your finances. You can use the money to pay for unplanned expenses or emergencies that may appear in your day to day, rather than increasing your debt or long-term investments.
As an entrepreneur, it is suitable to have a cushion of six to 12 months of your fixed expenses. This will allow you to pay for personal accounts and not worry if you need to reduce your income due to the flow of the business.
7. You spend out of your business
Although it is very important to always invest in yourself and in your business, you should not have "all the eggs in one basket". Diversification is extremely important because it will decrease your risk of investment in the long term. Working with a financial planner to create a portfolio of investments in the long term that includes stocks, bonds and Cetes that align with your own financial goals and your risk tolerance.
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