Published: 2 September 2021
Running your own business is a busy experience. You’ll need to think about everything from market research and products to customer surveys and legal requirements.
But there’s one aspect of your company you need to make sure is running as smoothly as possible – the finance.
If you’re already thinking about your launching your business as a University of Sunderland in London student, well done!
But trying to do it all can take a lot of thought and planning, especially if you’re juggling studying, being an entrepreneur and whatever else is going on in your life right now.
So, take a look at some of our tips for getting the money side of your business running as smoothly as possible and give yourself the breathing room to achieve all you can.
Keep your business and personal goals separate
You’re creating this company to, among other things, earn a salary. That makes it easy to mix up the financial aims of the company with your own.
Make sure you’ve got a clear idea of the financial goals for your business and keep it distinct from the things you want to do in your personal life (like saving up for a house or planning your retirement).
Don’t mix up your expenses
Along the same lines, it’s important to keep what you spend on your business and in your personal life very separate.
Don’t, for example, take money from the till to pay for something that should come out of your salary.
This will help when it comes to declaring your tax as a self-employed person.
A separate bank account for the company is worth thinking about for this and will build up a credit score for it which could help if you need a loan in the future.
Have a salary
Something a lot of people worry about when they’re starting their own business is taking too much money from the company for their own wage.
But it’s important to pay yourself, even if it only starts out as a small amount. As you grow, that number can get higher.
Put money into a pension
Another pitfall new entrepreneurs often find themselves in is that they rely on the company to fund their retirement.
The problem with this is if business comes into financial difficulties, you’ll be working for more years than you want.
Plus, it builds up stress, with your plans being reliant on the success of the company.
For an idea of where to get started with self-employment pensions, check out this article from Pension Bee.
Use financial software
To make running the finances of your business as simple as possible, it’s a good idea to use one of the wide range of programmes available.
This will help you with things like billing, invoices, inventory and your banking.
There are lots of free options out there if you want to keep to a tighter budget.
There are loads of other things you should consider when you’re planning the money side of your company.
Think about speaking with a financial advisor before making any decisions that could affect your business.
Whatever you decide to do with your future, the University of Sunderland in London Careers and Employability Service is here to help.
To have a one-to-one chat with them, book a meeting through Compass.