Last Updated on Apr 17, 2020 by James W
Starting a business with your own money, also called bootstrapping, can be an exciting prospect. When you fund your own business, you already save a lot of money since you won’t have any interest expenses that are payable on a business loan.
In order to fund your own business, however, you may have to make certain changes, especially when it comes your spending habits. Here are some things that you can do to save enough money so you can fund your startup.
Decide beforehand on the amount and date and break it down into monthly goals. If you know that you need to save, say, $450 per month, you know how much of your paycheck you have left to spend. This will give you the incentive to take measurable action towards saving and it will also help you see exactly where you go off track.
Do extensive planning
You know more or less how much your monthly expenses are. Before the start of every month, draw up a budget. Subtract all your monthly expenses as well as your monthly savings deposit from your income. It is important that you prioritize. The money that you save every month should enjoy the same priority as your rent, food, and utility bills. If you find that there are items that don’t make the cut, remove them from your expenses list, especially if they are luxuries.
Prepare food at home
As a rule, you’ll save a lot of money when you prepare your food at home, rather than buying takeaways or eating at a restaurant. It is also healthier and will help you spend more time with your family. When you prepare your food, make sure that you make enough for the next day at work so you won’t have to buy something to eat during your lunch hour.
Cancel your cable service
Switching to a media streaming service can save you a lot of money, especially if you install a Virtual Private Network or VPN. A VPN hides your online identity and geographical location, making it possible to find a streaming service at the best price. It will also allow you to only watch content that you and your family like. Finding and installing a VPN for Kodi, Firestick or Fire TV is simple and quick.
Reduce your debt
Paying off debt can be especially helpful if you have a long-term plan for funding your start-up. When you reduce the principal loan amount, it saves on interest and gives you some breathing room at the end of every month. Of course, it is critical that you never swipe your credit card while you are saving to fund your business. If you can pay cash for something, it is best to live without it.
Don’t buy a new car
When your goal is to fund your own business, don’t buy a new car. Drive the car you have until you achieve real financial freedom. Keep track of your gas consumption and make sure that you don’t neglect your car’s maintenance as this can lead to bigger and avoidable expenses.
Get rid of bad habits
Smoking and drinking during the work week can be expensive and detrimental to your health and productivity. When you stop smoking and only drink on weekends, it will help you to wake up fresh in the mornings and it can save you a lot of money. During stressful times and depending on your tolerance, drinking is something that can spiral out of control, something that you definitely want to avoid when you are transitioning into self-employment.
During the day, you may find that you often swipe your card for little things. The occasional chocolate, thank you gift, or little garden ornament that you bought on impulse can amount to a considerable monthly expense. Make sure that you avoid these little irregular and unplanned expenses at all costs.