![]() ![]() Missing payments will likely trigger penalties in the form of higher interest rates, which in turn creates even more debt payments. ![]() It might seem counter-intuitive, but don’t ignore credit card payments. A credit card might seem like a lifeline in uncertain times, but that debt only gets worse over time. Look at credit card usageĪvoid carrying a balance on your credit card, and if you can pay down what you owe, do so. It should go without saying, but if you need to tap into this savings account, make sure to refill it once the short-term emergency has passed. The size of your emergency savings can vary depending on your expenses and lifestyle, but one to three months is a good rule of thumb. Monthly payments are a great way to establish such a stash or try automatic transfers from your main accounts to this new fund. Remember the imagined scenario with your breakfast joint? In that case, an emergency fund would help you offset the unexpected increase in expenses until you came up with a long-term plan. Now, with your pared-down list in hand, let’s examine some of the ways you can leverage financial planning to reach those goals. When you do attain it, set another goal, and don't quit until you reach it. Set a goal and don't quit until you attain it. Once you do, go back through, prioritizing and even omitting some of the items you’ve jotted down. Don’t just give this a passing thought - it helps to sit down with pen and paper, and list them out. To track your finances more effectively, start by identifying goals. Related: Creating a business budget plan for emergencies Identify your financial goals Let’s buckle up and cruise through a few ideas that can go a long way in shoring up your business and personal finances. The core concept holds true: Everything is fine until it isn't. These days, such a plan for money management should be considered as necessary as health or auto insurance. Most people don’t plan to fail, they fail to plan. If the plan for your finances didn’t address the possibility of drastically increased operating costs and loss of income, your wonderful venture would be in deep you-know-what. Everything is just sailing along until, as we mentioned earlier, the price of eggs goes through the roof. People line up around the block, especially for your omelets, frittatas and quiche. Imagine your dream was to open a quaint breakfast spot serving all the recipes handed down in your family. Why it’s important to have a plan for your finances We’ll also check out some tools that can help. Let’s look at some strategies for staying solvent when it’s a complete dumpster fire out there. But develop a system to keep track of your finances, and you can keep on thriving.Īs sure as the spring will follow the winter, prosperity and economic growth will follow recession. Avoid doing this and your venture might not survive when a downturn hits. You need an available supply as well as a backup, plus a solid plan to manage everything. Not to get all doomsday on you, but to the entrepreneur, finances are like the prepper’s crates of emergency rations. If there ever were an occasion when you absolutely needed to keep track of your finances, these uncertain times would be it. Heck, even the price of a dozen eggs will set you back. ![]()
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