Finance is the study of money and how it is used. Specifically, it deals with the questions of how an individual, company or government acquires the money needed – called capital in the company context – and how they then spend or invest that money. Financial Fitness in Entrepreneurship is the single most important thing required for the business to survive in the current pandemic era.
Here are 5 tips to follow in order to maintain financial fitness of your office in these trying times.
- Track your money: Track every penny. One of the purposes of financial fitness is to track all of your spendings. You cannot do this if you do not have a written budget. To get your finances under control you need to know where every dollar and penny is being spent. Be very strict about how you do this. Don’t let anything fly by. You would be surprised how much money you spent that you don’t even keep track of.
- Write your Budget. If you don’t have your budget written somewhere then it will never happen. This doesn’t mean that it has to be down on paper but you should at least have a spreadsheet on the computer. Most of us have heard the saying. “a goal not written is merely a wish” and it goes the same with budgeting. A budget not written is a nightmare.
- Liquidity. After you have your budget perfectly set up, set aside the amount of cash that you need for your budget and spend only cash as much as possible. For some things, it is easier to use a debit card, like gas. In all ways possible you should only use cash. It is much easier to control your spending when you only have the cash to spend. Some people like to use what is called the envelope system. The envelope system works by setting aside envelopes of cash for each area of your budget. When your envelope is out of cash you stop spending.
- Cut out needless expenses. One of the key points of building better financial fitness is to cut out any unnecessary expenses. The first month of the budget is the hardest. After you have faithfully tracked all of your expenses, you will see areas where you have spent more money than you thought. Now it is time to cut out any unnecessary expenses. The money that you save can be put towards your debt using the debt snowball. If you don’t have any debt then start saving.
- Work Harder and Smarter. As mentioned earlier, the first month of the budget after pandemic will be the hardest and it is very easy to give up. Whatever you do, don’t give up. Keep going with your budget. It the long run it will pay off and you will be on your way to financial fitness.