As a business owner, keeping a close eye on your spending is essential. Although you may have fewer personal expenses than someone who doesn’t own a business, there are still ways to save money. You want to save as much money as possible to reinvest it into your business and help it grow. But how do you save money as a business owner?
Here are nine tips for reducing your expenses:
1. Track your spending for 30 days.
This will give you a good idea of where your money is going and where you can cut back. Some people like to use a budget, but you don’t necessarily need one if you’re just trying to get an idea of your spending patterns. Look at your bank statements and credit card bills and categorize your spending. If you use cash, you can track it manually or download an app like Mint that will do it for you.
2. Cut up your credit cards.
Most entrepreneurs use credit cards for business expenses, but if you’re using them for personal expenses as well, it’s time to cut them up. This will help you stay within your budget and avoid unnecessary spending. If you absolutely need a credit card for emergencies, keep one but don’t use it for anything else. You can also consider using a debit card instead of a credit card.
3. Get rid of unnecessary subscriptions and memberships.
If you don’t need it, cancel it! This will free up some extra cash each month. Do you really need that gym membership if you never go? This is very easy to let go of. But what about that timeshare property that wealthy entrepreneurs invest in? This may be a bit more difficult to get rid of, but it’s a waste of money if you’re not using it. Consult a timeshare title transfer service to help you eliminate this expense legally.
4. Automate your savings.
One of the best ways to save money is to have it automatically transferred into a savings account every month. This way, you’re less likely to spend it because it’s not sitting in your checking account. You can automate this by setting up a direct deposit from your paycheck or a recurring transfer from your checking account to your savings account. You can also use a service like Acorns, which rounds up your credit and debit card purchases to the nearest dollar and invests the difference.
5. Invest in yourself.
Take some time to learn new skills or take courses that can help improve your business. Not only will this make you more valuable to your company, but it can also help you save money in the long run by making you more efficient. You can find free or low-cost courses online or through your local community college. Some business owners also invest in coaching or mentorship programs.
6. Live below your means.
Even if you have the income to afford a luxurious lifestyle, choose instead to live modestly. This will leave you with more money to save and invest. You don’t need the latest car or the biggest house. A smaller home is easier to maintain and costs less to heat and cool. And a used car is just as good as a new one, especially if it’s been well-maintained.
7. Cut back on your entertainment expenses.
You don’t have to give up your hobbies, but you may want to reconsider how much you’re spending on them. For example, if you’re a movie buff, consider getting a Netflix subscription instead of going to the theater weekly. Or, if you like to travel, look for ways to save on airfare and hotels. There are many ways to enjoy your hobbies without breaking the bank.
8. Shop around for deals.
When making significant purchases, compare prices and look for coupons or sales. You can also use sites like Ebates to get cash back on online purchases. No matter what you’re buying, there’s likely a way to save money on it.
9. Negotiate bills and recurring payments.
Review everything from your rent or mortgage payment to your monthly gym membership fee and see if there’s any wiggle room for negotiation. If not, look into cheaper alternatives that better fit your reduced budget. Some companies are willing to work with you if you explain your financial situation. Ask, and you may be surprised at what you can save.
Reducing personal expenses is extremely important for business owners. Not only does it free up more money to reinvest in the business, but it also sets a good example for employees. By following these nine tips, you can easily cut back on unnecessary spending and put more money back into your business.