I know I need a budget. Where do I start?
High five to you for getting started with your budget!! I know money is a challenging topic to tackle and starting is indeed the hardest part. In case you love budgeting as much as Harper does (not a lot), we are here to help!!
1. Where to start?
If you have the benefit of having an established business, you can start with where you are and what you know now.
If you do not have an established business, you start your budget by making estimates – hypothesis, based on the data you collect and your revenue plans. As you get more data, you adjust and make the budget and forecast more realistic.
To set up the budget, ask yourself: What are your current expenses? Planned expenses? What is your current incoming revenue? Planned revenue? Etc. Then adjust as needed to get the budget where you want it… And by get where you want it, I mean where you want your profit to be.
- Are there any expenses you want/need to cut?
- What do you need to add to invest in your business?
Need a budget template? Hop on over to this oldie, but goodie.
2. How do I account for seasonal revenue?
I hear you!
In my photography business, we experience seasonal revenue and many online business owners deal with this in launch mode too!
Answer – You budget and plan for ups and downs!
For example, hold onto enough cash to be sure you are able to invest in future launches as well. E.g., if you are planning a Fall launch, start setting aside money for that in the summer. We forecast the money and hold onto it for when we'll need it or else we won't have money coming in.
3. Money Systems
Alright… I'm not talking about the tech systems specifically – although that may be a part of it – I'm talking about what days of the month do you review your money? What days do you pay people? Update your forecast? Make sure payments came in? Check on outstanding payments? As your business grows this should not be willy-nilly! Get your money systems in order to stay sane.
4. How to Stop Bleeding Money
Set up that budget and get your money systems in order!!
Before you make any purchase decisions – check the budget! If you make this purchase, will it throw your budget off? If yes, and it is still a need, what can be cut from the budget so you can add this item?
Money leaks also come into play when revenue that is expected is not collected. Setting up systems to check and follow up on aged receivables will help. Regularly reviewing your payables and what you spend will also help because you'll be able to see… “I spent what?!” Or “Oh, I still have this subscription??? Cancel.”
5. Become a Manifesting Machine
My friend Lewis Schiff did the research and it’s a fact: self made millionaires and billionaires don’t worry as much about outgoing expenses as those who stay in the middle class. Instead the self made millionaires and billionaires focus on bringing in more revenue. Step into your CEO role and become a Money Manifesting Machine with Denise’s free Manifesting Formula training. Here’s the link to get in on the action: https://goo.gl/2HB10e
That is how you start.
What am I missing?
Can’t wait to see your perspectives in the comments!