May 10, 2023
The United States is home to 30.7 million small businesses which means there are millions of people out there working, wishing, and grinding to make their business ideas a reality. Unfortunately, not every idea sticks. 82% of businesses fail due to a faulty financial plan. At Citizens First Bank, we want to see you thrive as an up and coming entrepreneur! Here are some financial tips to help you succeed.
The first action item when beginning your journey as an entrepreneur is to create a budget. This will help you decipher more quickly the “must-haves” from the “wants” for your business. This vital step is crucial in keeping your business afloat. Too many “want” purchases can sink your business. Create a budget and stick to it.
Every entrepreneur knows that things are not always going to go as planned. With seasonal fluctuations, downturns in the market, and even personal obligations, life happens– so in order to help alleviate the inevitable, it’s best to create an emergency savings account. Whether you experience a setback or not, being prepared with an emergency savings account will offer some peace of mind.
As scary as it can be, you’re going to have to take some risks as an entrepreneur if you want to see your business grow. But there’s a difference between a smart risk and a misguided one. If your business sees an increase in revenue and your profits grow, a smart risk can mean putting that profit back into the business. From new equipment, project management systems, or even outsourcing work, taking a calculated risk can boost your business’s growth. But if you decide to reinvest in your business when numbers are not looking good, this risk can lead to a financial setback.
It takes a lot of hard work and dedication to make it as an entrepreneur and to build a fruitful business. This also means it’s very easy to get caught up in the everyday business needs, especially when you’re first starting out. Remember, as a self-employed person, it’s up to you to plan for your retirement and it’s up to you to save for your own rainy day. Throughout your journey, remember to take some time each month to contribute and plan for your own financial goals!
As a new entrepreneur, it can be intimidating to join a field with many learning curves. 60% of successful business owners say they are not knowledgeable enough about finances or accounting and often reach out to those who do. If you are unsure about a process or terminology when it comes to your business’s finances, reach out and ask for help. Whether it’s a former colleague, mentor, or us here at Citizens First Bank, asking for help is never a sign of weakness or failure. Use the resources around you and you will become a better entrepreneur.