Starting a business of your own takes a lot of time, money, and effort. So when it comes to that moment when you truly decide this is the right career path for you, you’ve got to ensure your finances are in check! But why is this so beneficial? Because having a secure foundation to work from will make the path towards business success much smoother – you’ll have a lot of things to pay for from here on out. As such, here’s a checklist to go through to ensure you’re ready to start a business from your bank account’s point of view.
Check Your Credit Record
The first thing to do is go over your credit record, and make sure there’s nothing left on there that could potentially harm your credit score. Sure, a bit of bad spending here and there is fine, and maybe you’re still paying off a student debt, but everything you have already paid off needs to be cleared entirely. Some people can be turned away from taking out business loans based on credit records that haven’t been properly updated, so always check this first.
Look into Rewards Cards
One of the best ways to supplement any spending you’re going to do in the near future is to work with a cash back credit card or two. When you get rewards for simply buying items you were always going to in the first place, you get double the bang for your buck. And seeing as you’re going to have to tighten the purse strings while setting up, you can use these rewards points, loyalty programs, or simple money off coupons to your favor outside of the business world.
Separate Your Savings
If you’ve got some savings to work with, now’s a good time to separate the pot out into piles. One side is for the business, and the other is an emergency fund you can still use just in case. You never know when an accident may occur and you’ll need some money to weather the storm. And separating your savings out doesn’t even need to be all that hard. You don’t have to go 50/50 here – 70/30 with the bigger pot going towards your business plans is a much more realistic and workable number.
Construct a Budget
Finally, you’re going to need to depend on a budget like never before! As such, sit down with your current spreadsheet and go over every single way in which it might change. For example, if you’re planning to leave your job soon, you may have to do away with a renewable income for a few months. How much tighter will that leave things for the foreseeable future? To help with this, be sure to download something like a spending tracker to keep an eye on how your budget is moving.
Running a business while also trying to save your own budget is tricky. Make sure you have everything you need before getting started.