Entrepreneurship continues to become an attractive career path for people the world over. While some intentionally chose that path, others found themselves on it as a result of unexpected circumstances or undiscovered passions. Whatever the case, it can be a beautiful journey to take but also one faced with challenges that you can never fully prepare for.
One of these challenges is the significant strain it can have on you financially, especially as you don’t have the security that you get when you work in formal employment and expect your salary every month.
On that note, here are money saving tips that the modern-day entrepreneur will appreciate.
Set up a Retirement Fund
You need to set up a retirement fund. Why? Because you will no longer have the assistance of an employer, which is important for your future.
You can explore different options for retirement such as turning your business into a pension fund or including your family in the business and accruing assets in their name. If you own a limited company, you may also find that it’s more tax efficient for the company to make the pension contributions than for you to pay yourself a salary and pay it into a pension fund.
Cut Down on the Basics
Setting up a business is costly, and as an entrepreneur, you may have to cut down on a few home luxuries. This does not mean you can’t have a phone contract or visit the gym, but it does mean heading to a cheaper gym if it’ll save you money in the long-run. Here are two ways to save money:
- Phone Bill: As an entrepreneur, you’re going to spend a significant amount of time on the phone. It could be to liaise with contractors, communicate with employees or look for new business. In light of this, see if you can find a reasonable service provider that gives you a good amount of talk time for as little as possible. HandsetExpert has some of the best mobile phone deals, so see if they have any packages that meet your needs.
- Entertainment: If you happen to be quite the entertainment junkie, then you may find that you’re subscribed to many streaming sites, have one of the most expensive Sky packages and have memberships for different types of entertainment. It can accumulate over the months, so to spend less on entertainment, try cutting out the ones you don’t need to save money.
Have an Emergency Fund
There’s no telling what direction your business ventures will go in, so it’s essential that you plan for contingencies. One way of doing this would be to set aside an emergency fund that will save the day in months when business isn’t booming. To create an emergency fund, open an account and set aside a certain amount monthly.
Keep Accounts Separate
Keeping your accounts separate is also crucial for the modern entrepreneur. If not, you could develop the habit of mixing up business and personal funds, having a negative impact on your business and your finances. Ensure you have separate accounts and credit cards for both to avoid confusion and stay on top of expenses.