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When you are small business solopreneur, and are just starting out, you need to really set and stick to a budget for your business. Even once you have a steady income in your business, you need to set a budget as well. By using a budget as a solopreneur you can be ready when some expected expenses pop up. Whether you are in a business environment or a personal environment, unexpected expenses always pop up. And the only way to handle them with ease is to be prepared.
The first step is to split your budget into 4 categories:
Prospective income is what you expect to bring in in your business for the year. This is going to be a very rough estimate because as a solopreneur, you are going to continue to come up with new ideas to market to your ideal customers, but when you create this estimate, you won’t know about these new ideas, so you won’t be able to include these in your estimate. Usually your estimate is based on your income from the previous year.
Your fixed expenses are going to be things like rent, web hosting expenses, internet and phone expenses, and those expenses that cost the same month after month with little or no change and you can’t run your business without these monthly expenses.
Variable expenses are going to be things like office supplies, plugins and themes for your website, computer expenses, education and basically any expense that you pay during the year that is not a fixed expense, but you need to have in order to efficiently run your business.
And your payroll expenses are going to be what you pay yourself and any employees you happen to have. You can’t pay yourself everything that comes in to your business, it must be split up somehow.
These are all topics you need to know to successfully run your own business. By learning budgeting and what you are spending in your business, you can actually have a higher income in your business year after year.
Clarissa Wilson is a financial strategist and online educator who holds two master’s degrees in Forensic Accounting. Also creative and spiritual, she is an intuitive empath and introvert. Clarissa is the host of The Prosper + Profit Podcast, where money conversations occur on a daily basis -- as she believes that money shouldn’t be a taboo subject. After growing up on a dairy farmand learning to work hard for money, Clarissa awakened to a path that allowed wealth to flow easily to her. Clarissa currently lives in Pennsylvania with her two cats.
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