Financing a business is one of the hardest things any entrepreneur will ever have to do – and many never find the funding they need to get started externally. If you are determined to get started though, there are ways to whittle down your budget, so that you can redirect money you’re already spending into a business start-up fund of your own!
Let’s look at some common household expenses, and how you can shave some money off them to spend on your business.
Housing or Accommodation
If you’re renting a home, then you can save money for business finance purposes by considering a smaller home or a home in a less costly area when your lease is up. If you live alone, and you have a spare room, then you might be able to get a room or house mate, to cut costs.
If you own your home, then there may already be equity in your home that you can access. If not, you also have the option of taking on a boarder, and cutting down on costs, and if you don’t want to share your home, how about renting out your garage as storage space?
Meals and Entertainment
Meals and entertainment are another area of your household budget that often contains hidden money that you could use for business finance.
Make it a rule never to buy anything that’s pre-packaged or processed. You’ll save a bundle, and you’ll be healthier too! When it comes to entertainment, remember that a couple of bottles of wine at home are always cheaper than cocktails in a bar, and you won’t have to pay for a taxi home either! Likewise, DVD’s on your couch is cheaper than movies, and the beach or a park is a better option than costly outings.
Insurance, Communications and More
You’d probably be surprised to realise that you’re almost certainly paying more than you should for insurance, cell phone and telephone bills, utilities and other monthly expenses.
Checking to make sure you’re not over insured, and taking the time to phone around for better prices from all of the companies you buy monthly services from can make a huge difference to your budget, and can save you money to put toward business financing.
If you’re driving a big car, and you’re not transporting several people in it, you’re probably paying too much for the car and the fuel you use. Consider trading it in for a smaller, lighter, possibly second hand model, or even better, use public transport to get where you need to be (at least most of the time!)
Transport costs add up quickly, and you may just find that there’s a significant amount of money to be saved here.
You’ve Whittled Down Your Budget – Now What?
If you’ve done all the things mentioned above, and any others you can think of to save money, you may have as much as 10 to 20% of your usual monthly expenses to redirect to business finance.
Either you can use it as you save it, and start your business small, or you can set up a high interest notice account, that you can save the money in and access it once you’ve built up a sizeable amount.
The good news is that it’s almost always possible to start a business without outside funding, as long as you scale your business plans to suit, and you are careful with money. You might not be able to start off the way you would like to, but it’s often better to start with no loans hanging over your head, and to have the freedom and autonomy that self funding brings!