Top 3: Starting a Business
Experiencing a life changing event can feel overwhelming. In this series, we help narrow down your to-do list by focusing on the Top 3 areas for attention and action. Use these guides and make progress as easy as 1, 2, 3.
1. Build cash savings
Before leaping into full-time entrepreneurship, build up cash savings. A strong cash reserve acts as the foundation for a new business before it generates consistent, reliable cash flow. Saved money supports daily living and provides the financial security necessary to maintain focus on business growth.
Start by computing monthly nondiscretionary expenses, such as rent or mortgage payments, insurance, basic food, etc. Save enough to cover these necessary, reoccurring costs for a designated time period. Also consider one-time startup business costs or supplies and save ahead for those expenses as well.
2. Create separate accounts
Simplify financial record keeping by creating separate business accounts. Open (or designate an existing) bank account and credit card for business purposes only. Completely separating business and personal finances simplifies monitoring expenses and cashflow. It will also expedite on-going and annual tax preparation.
3. Focus on business growth
From business plans to marketing plans, new entrepreneurs are pulled in many directions. Start simple and small. In the earliest days, time and energy are best spent primarily focusing on growth. Concentrate explicitly on client or product development to create a strong bedrock for the business’ future. Establishing ongoing cash flow is the key to longevity.
Top pages and categories
