Saving is important at any stage in life. It’s a well known fact that personal savings are the most important source to fund startups. Even the giant Amazon was started by the savings Jeff Bezos’ parents put in the startup. Savings are needed to not only start a business but also sustain it through the initial struggling phase and slumps. While most people understand the importance of saving, they keep delaying it and thus delaying their ability to launch their dream business. Fortunately, there are practical steps you can take to save:
Take Bold and Concrete Steps to Save
Figure out how much money you need to launch your business. Set strict goals to save at least a certain amount every month and stick to them. Take bold and aggressive steps if you have zero savings and just starting out now. Take up freelance work or a second job. Move into a smaller house. Once you have some saving, invest it in stocks and mutual funds after making due investigation.
Cut Out Unnecessary Expenditures
Figure out your needs and necessities from luxuries and trim out the latter. Cancel a gym membership, cable or magazine subscription that you hardly use. This also means making personal sacrifices. You don’t need to go out that often, eat out or order takeaways, or shop every time a sale hits the town. Bring your family on board your saving plan and enlist their support and understanding.
Pay Cash Always
Cancel multiple credit cards. Buy only what you can pay for in cash. If you don’t have money to pay for something now, you won’t have it later on as well. Paying for the purchase with compound interest would make your original purchase more expensive down the road.
Don’t Quit Your Job Yet
Unless you have been out of work or laid off, don’t quit your regular job to start off a business. It may be tough to give equal attention to your regular job and start off and sustain your own business, but it is better being broke for a while. The income from your job not only helps in paying the bills but may also fund your business in times of need.
Get Out of Debt at the Earliest
Debts are what can hamper your ability to save for quite a while. So before you start saving, get rid of any debt first. Paying minimum payment every month and carrying forward heavy interest fee is what prolongs debt payment. Borrow money from your family or friends on interest-free or low interest terms and pay your debt from it, then pay them back on easier and flexible terms.
We need money for everything, even for starting and funding a dream business. Inability to save means the lack of discipline and inability to manage your finances and business down the road. I am Luci McMonagle, a life coach. I can help you break through the financial barriers that are holding you back from realizing your entrepreneurial dreams.