It’s not particularly uncommon to be placed under a large amount of stress involving work and the workplace. However, this can be further increased when it comes to being an entrepreneur. Starting and managing your own business affords a number of freedoms, but also presents new challenges as well. According to a psychology study conducted by the University of California, 30% of all entrepreneurs deal with depression. For those entrepreneurs hoping to rest just a little bit easier, here’s 7 tips on how to manage your financial stress.
1. Keep a Realistic Schedule
While you can make more money keeping yourself working as many hours as humanly possible, it’s not a sustainable course of action. Eventually you’re going to burn yourself out. When this does happen, you’re going to be left taking down time, completing work less efficiently and perhaps even sloppily. It’s not worth whatever you gain to jeopardize your health and how to most effectively manage your time.
2. Pay for Good Help
Your time is your most important asset when it comes to being a self-made entrepreneur. If you delegate your least important tasks to someone else you can then focus on what makes you money and is crucial to business. Hiring a virtual assistant is a good way to keep from handling the small tasks that pile up day in and day out.
3. Don’t Be Cheap, Be Frugal
You get what you pay for, and more often than not if you try to cheap out on something you’re not going to get what you were hoping to achieve. Whether it’s equipment, help, or resources, don’t be afraid to pay for its value to you, not just what its lowest market value is. You as a business owner can stand to lose a bit on price, but if you ultimately spend without gaining what you’d planned it will be a total loss.
4. Save for Emergencies
Your business can be faced with any difficulty at anytime. The same holds true for your personal life as well. As an entrepreneur, you are just as much a part of your business as any resource in your possession. Try to keep both yours and your businesses finances in order through saving as much as possible. Saving 3-6 months of expenses can cut down on the stress of business when things get difficult.
5. Don’t Overestimate Tax Write-offs
It can be appealing to think of business tax write-offs as free money come tax season, but that mindset will seriously impede your cash flow. Spending shouldn’t be done frivolously or just because you can write it off for your business. You should take serious steps to manage how much cash spending your business does, even if it requires consulting a CPA to do so.
6. Organize Your Finances
While your business and personal finances are separate, both should be properly organized. Entrepreneurs that have worked a number of jobs in the past can find that they have several 401k’s at their previous companies. Working to consolidate these into one can help reduce confusion over their existing assets. Having your finances in order can help alleviate financial stress.
7. Minimize Your Credit Card Debt
There are many success stories that begin with using credit cards to finance a million dollar idea, but there are even more stories of failure with the same setup. You may be able to roll over and consolidate credit card debt for a while, but eventually it will become a mountain not easily overcome. You should instead try to finance your goals upfront yourself, and make do without going into debt personally.