7 Steps for Getting Out of Debt and Increasing Your Business’s Financial HealthSelf, Business , Finances
If you’re reading this, you are likely struggling to stay ahead of your finances. You may be wondering how to get out of debt or how to make more money. Brittany Fisher from Financially Well shares seven steps that will help get your finances on track.
- Manage your debt. You want to pay off the debt with the highest interest rate first. Figure out how much money you owe and to whom, then try to consolidate your debt as much as possible. Negotiate with creditors to try to come up with a plan for repayment that works best for your current financial situation. You’ll be surprised how often they are happy to offer flexible options or lower your interest rates if it means that it’s more likely that they will get paid!
- Make a budget that includes all your expenses. Many business owners are struggling to have a good understanding of where the money is going. So make sure you include ongoing fees, recurring expenses, and one-time costs, as well as discretionary spending. This will also help you manage your cash flow and know the timing of your payments and cash needs.
- Increase your revenue. There are many aspects that you can tweak to increase your revenue. From expanding into new products or markets to simply playing with your pricing strategy. Also, remember to look at passive income options that require minimal work but will give you a sense of stability.
- Plan for contingencies. You can increase your financial health by starting an emergency fund, increasing your capital, and planning ahead for future capital expenditures. Make sure that you also plan for your own financial future and save for your retirement so that you’re not solely reliant on the business’s success for your future.
- Find an accountability partner. If you struggle to keep on top of your debts and stick to your budget, having an accountability partner can help you to stay focused on the less fun aspects of financial management. This could be a fellow business owner who is willing to partner with you on this, or you could even reach out to a professional financial planner or CPA. This has the added advantage that they can provide independent advice and support to make sure your business plan is solid.
- Hone your business and financial skills. If you don’t feel comfortable managing your numbers, it can seem like a daunting task to stay on top of your finances, which can be a reason to keep putting it off. There are many top-notch online degrees available today that you can take from the comfort of your own home and in your own time. Consider taking an online accounting or financial planning degree to level up your business acumen. And invest in easy-to-use accounting software to help you stay on top of your money.
- Make sure you’re taking full advantage of tax deductions or credits. You’d be surprised at how many business owners end up overpaying their taxes simply because they’re not aware of what they can deduct, such as office supplies or loan interests.
You are in charge of where your company goes from here. And remember that there are professionals who can help manage your businesses’ finances, so don’t be afraid to reach out if you need assistance.
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