Handling Your Personal Finances Like A Business Owner

The best way to handle your personal finances is to imagine that you’re running a business. The business, in this analogy, is your life. Obviously, you’re not selling a product or a service, but you are trying to make money and stay in the green. Additionally, you’re trying to invest that money in improvements to your life and also safeguard the future of your family. There are many similarities between a well-run business account and a well-run personal account. If you want to improve your money situation this year then here are a few examples of ways in which you could start to handle your personal finances like a business owner.

Write up a budget.

This is something that we all know we should be doing but very few of us actually do. Yet, so many financial problems could be avoided with a little bit of planning and foresight. You can’t control everything in the world when it comes to your money, as we’ll discuss throughout the article, but you should draft up a plan for the aspects of your finances that you can control. You should calculate how much of your income needs to go towards essentials such as mortgage payments, utilities, and groceries on a monthly basis. Your disposable income is the income that remains.

Of course, your disposable income isn’t just “spending money.” You need to learn to live within your means. And you might have necessary payments to make on a temporary basis. If you owe money then this should be a priority before spending your earnings on non-essentials. You might even want to look into credit consolidation so as to put all your debts together in one manageable monthly payment if you’ve been struggling. The point is that you need to handle your personal finances by organizing them into manageable bundles. You should also make sure you tie up any loose ends if you’re owed money by others. Make a note of all income and expenditures on your budget so as to track your wealth increase (or decrease) on a monthly basis. If you’re struggling to increase your wealth then the following advice might help…

Invest to create an additional income stream.

A business will invest in new projects so as to increase its profit potential. As an individual, you should consider doing the same. Obviously, the types of investments you’ll be making will differ vastly from a big corporation, but the end goal is the same. You want to increase your wealth so as to give yourself a more comfortable future. Much like a successful business, you already have a steady source of income (your salary), but you don’t want to put all your eggs in one basket. Opening up additional sources of income can offer you some financial security and peace of mind.
When it comes to the type of investment you’re going to make, consider the risk-averse route. Investing in stocks and bonds or assets with fluctuating values is a game you should only play with caution. You might want to start by looking into the property market. This market still comes with its risks, such as fluctuating house prices, but there’s no entirely risk-averse industry. Property, at the very least, is an asset that has been valuable since the dawn of man. People need homes. Plus, with some research (and a dose of DIY), you can make a sizeable profit from buying, renovating, and selling houses. It’s all about gauging the market and price values in certain locations.

Keeping Recruitment Costs Reasonable

One of the most important thing that any business can do is hire the best talent available for them. Because it is so important and because companies want to get the best possible person for every role, it is not surprising that recruitments costs make up a huge percentage of the average business’ annual expenditure.

That being said, most businesses could easily slash the amount they spend on recruitment and keep it at more manageable levels. So, if you’re currently spending a lot of cash on hiring the right people, take a look at the following tips to keep the costs associated with that more reasonable:

Work Out How Much Your Spending

The first step to cutting your recruitment costs down to size is, of course, knowing how much you’re spending now. Work out exactly how much you’re spending on the whole process from turnover to admin to advertising roles and then you can start to identify where you are spending too much so you can start making changes.

Hire Smart, Save Money

Perhaps the biggest cause of too high recruitment costs is choosing the wrong candidate. If you do that, then not only have you wasted a lot of time and money on recruitment in the first place, but you’ll have to go through it all again to find someone more suitable. Add to that things like severance pay and hiring temps to cover until a more suitable employee is in place, and you can easily see how costs add up. So, if you do nothing else, hire smart the first time around.

 

Automate as Much as Possible

There is absolutely no point in employing excessive levels of HR staff when so much of the process can be automated right now. From applicant tracking systems, which significantly cuts down on the amount of time and energy it takes to manage one’s talent pool to messaging apps that make contacting applicants after they have expressed interest so much simpler, there are countless technologies that will come in at a fraction of the cost of using humans. So, be smart and automate.

Make Use of Screening

I could have included this in the automation section, but it’s worth taking a moment to discuss screening on its own. There are still too few businesses who are using applicant screening technology to narrow down the field and find the most suitable candidates right off the bat. This is bad because manually screening applicants even if it’s just going over their resumes, takes so much time, effort and money that it is literally sucking some companies dry. So, if you want to get the right people and spend as little as possible, build pre-screening into your recruitment process from the beginning.

Make Use of Social Media

There are still a lot of business owners and HR staff who think that using social media to find candidates is a bit of a joke – it isn’t. Actually, it makes a lot of sense to use what are essentially free platforms used by billions of people all over the world, to recruit new talent. The key is to use the most appropriate platform, which is likely to be the platform your ideal employee is using and to screen them as extensively as you would any other candidate. In fact, screening them might be a whole lot easier when you can see what they’re up to on social media!

Recruit More Quickly

It’s simple really, when you cut the amount of time you’re giving yourself to recruit, you’ll spend less resources and therefore less cash on the process. Cutting recruitment time can also make you and your candidates much more focused and it will mean you don’t have to try and cover a position with fewer staff or bring in an expensive temp for quite as long, too.

 

Always Offer Market Value

Trying to save money by offering candidates less than market value for their skills is a false economy. It is far better to offer them a fair salary right upfront, so that you don’t end up having to spend way longer recruiting someone who’s willing to accept less, nor do you have to waste time hiring someone who isn’t up to the job and then re-recruiting at a later date.

If you do as many of these things as you can when you’re next recruiting a new employee, you should notice that not only do you spend a more reasonable sum of money, but also that the process is much more simple too!

Almost Payday: 3 Ways to Keep Going When a Bill Pops Up and It’s Almost Payday

In case you’re living a paycheck to paycheck lifestyle, you can probably relate to how quickly things can get out of hand when unexpected bills pop up out of nowhere. After all, these are unplanned expenses you’re going to need to cover somehow, and your current financial situation may not allow you to do so without getting the money from an external source. No matter what you do, keep calm – there are many things you can do to dig yourself out of the rut!

1. Withdraw the money from your emergency stash

You do have an emergency stash of money, don’t you? If not, unexpected expenses can serve to teach a great lesson about establishing one as soon as you can afford to. That way, similar situations will be far less burdening in the future. If you decide to deplete your emergency savings, make sure to replenish them after a while (basically, as soon as the dust settles).

Making a compromise and taking the money from your children’s college savings account, for example, is not ideal, but it is an option to consider. After all, if they’re not too close to their college years, you will probably have more than enough time to fill in the hole later.

2. Look for ways to avoid spending your money unnecessarily

Are there certain things you can live without for the rest of the month in order to cover the bills that are staring you in the face? Temporarily cutting off the unnecessary expenses is a great way to raise some additional funds (but you do need to have the money readily available for the method to work).

For example, are you willing to cook your own food for a month and avoid eating at the local restaurants? Can you find a cheaper way of commuting that may be less comfortable, but more cost-efficient? Can you postpone fixing a scratch on your car that’s only an aesthetic drawback, but doesn’t negatively affect its functionality? These are only a couple of examples of how you can extend your funds, and you’re going to have to come up with your own that apply to your particular situation.

3. Borrow the money you need

Friends and family members are likely to lend you a helping hand when things get tough. Ask them to lend you some money, and if they trust you’ll be able to repay them later without problems (if you have day to day job, for example), they will probably say yes. Of course, this is not to be counted upon and does depend on how close you are on a personal level.

If you’ve exhausted all of your other options, there are various online installment loans for you to consider. Please bear in mind these types of loans are to be treated as emergency money only, since they do come with high interests rates. But the good thing is that you’ll be able to pay them back in monthly installments, which should be more than doable if you have a regular income.

Conclusion

There’s no reason to panic, no matter how anxious you might get when seeing an unpaid bill on your desk. By being level-headed and utilizing a proper amount of planning, you’re going to take care of it in no time, effectively making your temporary financial worries a thing of the past.