Five Steps to Creating a Budget for Your Small Business

One aspect of running a successful business is the implementation of a comprehensive financial management system. As a business owner, you need to know how much you are making (revenue) and how much money you are spending (expenses). With the implementation of this system, you will be able to ascertain whether you have made a profit or loss.

One of the most beneficial tools you can install into a business’ financial system is a budget.  It is simply a tool which one uses to allocate money for various purposes.

An advantage of developing a budget is possessing the ability to track one’s own spending on a regular basis. This will prevent you, the business owner from overspending and losing sight of where your money is flowing.

I know what you are thinking. You’re thinking it sounds like an excellent tool to introduce into your company, but you may not know or have access to steps to creating one.

The following are Five Simple Steps you can use to create a budget for your company:

Step 1: Divide your budget into the following categories we suggest:

  • Donations
  • Investments
  • Insurance
  • Savings
  • Business Expenses

Step 2: Assign subcategories to the categories of your budget. List these subcategories below each category.

  • Donation – Charities, Schools
  • Investments – Term deposits, Stocks
  • Insurance – Life, Healthy, Pension
  • Savings –  Emergency Fund, Reserves
  • Business Expenses – Rent, Utilities, Loan Payments, Salaries, Office Supplies

Step 3: Create a column “Budgeted Amount” next to the subcategories you would have created and assign a monetary value to them. This would be the amount of money you plan to spend in a particular subcategory.

Step 4: Create a column “Actual Amount” next to the “Budgeted Amount” column. This would be the amount of money you spent in a particular subcategory.

Step 5: Create a column “Available Amount” next to the “Actual Amount” column. This would be the difference between the “Budgeted Amount” and “Actual Amount”; the remaining amount of money available for use.

You see, budgeting is a very simple process. It’s not rocket science at all! All it requires is the discipline to follow through with your spending plan.

Whether you are a start up or established business, it is always a wise practice to implement a budget to enable smooth operations within your company.

Astrape Finance

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Preparing Your Children for College

The best way to prepare your children for college, is to involve them in the planning process.

Here are some suggestions we have to offer:

  1. Guide your children into their field of study. Find out what makes them tick. You have known them their entire life and you know their strengths. Start today by finding out what they want to be when they grow up.
  2. Do not pressure yourself to send your children to a university. If they are interested in being a electrician, mechanic or even providing professional massage services, for example, there are many community colleges which facilitate these studies. This option will save you money in the long run.
  3. Teach them the importance of practising financial prudence before their college days. They will be on their own and will need to know how to budget. A great way to give them a hands on approach is to train them in budgeting their allowance or pay. Guess what? You can encourage your children to start saving for college. From today!
  4. Finally, encourage your children to take courses in their desired field of study in their high school (secondary school) years. On applying to their college of choice, they are likely to receive exemptions. Maybe even a scholarship.

So get your children involved today. It is never too early to prepare them for college.

Astrape Finance