One-Stop Financial Guide for Women Entrepreneurs

 


All That You Need To Know & Do to Take Care of Your Money 

A comprehensive guide for Women Entrepreneurs on managing their funds, loans and investments when they want to start their own business!

This is the new age of women empowerment! The Indian self-employment space is no longer dominated by men; women are equally participating in start-ups and new businesses. And guess what? They are equally successful too! 

Now, an integral part of any business is finance management. Starting from accruing the capital to managing daily expenses, loans, expenditure, investments and many more; Money plays a crucial role in any business. 

As a newbie, any guidance you get in this regard is a great help. So we’ve put together some of the tips and tricks to help you manage your daily and monthly expenses, your income and profit, your business loans and any investments you need or have made in your business. Read on!

1. Budgeting and Planning

Any enterprise needs proper planning. Especially with money, you need to have a solid plan to manage your funds and stick to it at all costs. There might be many sources of money coming into your business and many sources of outgoing. You need to keep a clear track of all the particulars. 

  1. If you are a small business, use a simple excel sheet to track your income and expenditure.
  2. Save all important receipts and bills for future accounting purposes.
  3. In the initial stages, never overspend more than what your forecasted income is. 
  4. Keep your personal finances and business finances separate at all costs.


2. Business Loans

There are different ways of arranging the funds needed for your business. You might have taken a business loan from a bank or institution or you might have borrowed from friends or family. No matter where you borrowed from, ensure to pay back regularly on a month on month basis. This reduces your overall debt and prevents interest accrual. 

This also brings in discipline and self-control and you are able to plan ahead with your forecasted income. Set up ECS or auto-debit for the loan amount to be deducted from your account every month so that you can avoid late payment charges and payment defaults. 

3. Savings and Investments 

Once your business is established and you start making a profit, you have to diligently save this money and not splurge. You are prone to overspend if you do not have a plan. This money could have been utilized to help you achieve financial independence.

Investing can be a fantastic strategy to channel extra cash while also combating inflation. It can be utilized to increase wealth and redirect it toward goal achievement. The sooner you begin investing, the better. Investing can help you get from where you are to where you want to go. Begin planning for future objectives such as extending your firm, acquiring assets, your own retirement, and so on.

Once you have chalked up a goal for your savings and investments, you can choose from umpteen investment options. There are FDs, government bonds, stocks and shares, mutual funds, and many more. Weigh in all the options, considering your risk appetite, and invest in different channels. Don’t put all your money in one place. Have diverse investments. Ensure that there are investments that can be liquefied immediately in case of an emergency.

4. Emergency Funds

While saving and investing the profits, ensure that you put away some money every month towards the emergency fund. This emergency fund should be easily accessible to meet any unexpected contingencies that may arise in your business. 

Make it a habit to set aside at least 10% of your monthly income for an emergency fund. And don't put it in a savings or FD account. They do not provide high returns. You might invest in mutual funds; liquid funds could be an excellent choice for your emergency fund.

5. Managing Monthly Expenses and Various Hidden Costs

Your business is going to have a lot of petty cash expenses on a daily basis. There are also a host of hidden costs that are required to support your business. You will have wages, license charges, moving charges, transportation, insurance, machinery, maintenance charges, utility bills and many more. You need to account for these too in your financial planning. 

The most effective strategy to manage monthly spending is to calculate how much it costs to run your business for a month. Request discounts from merchants and suppliers. Speak with others who run their own business to learn about potential hidden charges, monthly expenses, and other related costs.

6. Pricing Your Product Right

This is a very common problem faced by many business owners. They underestimate their product and or are scared of quoting the right price thinking it might sound too high. This will only result in losses. To start with, this is a business and you need to price your product right if you want to be successful. Consider all the above factors while deciding your price. Include your labour and hard work too. Remember, ‘Generosity doesn’t pay the bills!’. Make an accurate calculation and fix the right price for your product. 

Conclusion

Starting a business is hard work. Though there are so many resources and assistance available, decision making in every aspect is tough. One cannot know everything and we are bound to make some mistakes. Being ready for these setbacks is what will make you successful. It is all about careful planning, determination and hard work. Remember to expand your knowledge and keep learning as you go!

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