Finance

Financial Advice For Marketing Entrepreneurs

As a marketing entrepreneur, it is understandable if you spend a lot of time thinking and worrying about money. These financial concerns are likely to include your own personal finance worries, if the business is going to make enough money and survive long term, and how you will manage in an emergency situation (like the pandemic). On top of this, you then have to worry about if you are paying staff enough, if your expenses are too high, and various other concerns. This can feel overwhelming, but the good news is that there are a few financial tips for marketing entrepreneurs that should improve your business and personal finances and provide peace of mind. Keep reading to find out more.

Continue Earning While Building Your Marketing Business

Part of the enjoyment of being an entrepreneur is being your own boss, but you should not quit your job just yet. It is a smart idea to continue with your current job while you build the business, which can alleviate financial pressure and make it easier to manage while the business is finding its feet. Keep in mind that you may not be able to pay yourself a healthy salary from the marketing business for a few years, so you need to build from stability and have enough money to keep you going.

Keep Your Finances Separate

One of the most common mistakes that people make when starting their own business is not separating their finances from the very start. It is crucial that you keep business and personal finances separate; otherwise, you will have a real job on your hands when it comes to completing your tax return and updating your accounts. Additionally, mixing finances is dangerous as you do not want to start using one for the other – this always ends in disaster. This is why you need to open up separate business accounts and make a clear distinction in your mind between the money for your personal life and business.

Build Up Personal & Business Emergency Funds

Leading on from this, you also need to build up an emergency fund for your personal finances and your business. This is intelligent because it means that you will be able to manage if the unexpected happens, which can provide peace of mind (this is hugely important as an entrepreneur). The pandemic is an example of the importance of emergency funds, as many businesses that did not have any funds in place were forced to close even when they were thriving before COVID-19.

Outsource To An Accountant

When starting a new business, you want to make sure that everything is above board and that you are maintaining accurate books. The best way to achieve this is to outsource to an accountant that will be able to manage your finances for you and even complete your tax for you. This can free up time and energy and reduce stress when it comes to financial management. Additionally, this will be helpful for getting an overview of your company’s financial health and help you to find the best ways to make savings.

Secure Enough Funding

Most new businesses fail due to cash flow issues they encounter in the first year or so. Often, this happens not because it is a bad business idea but because they did not secure enough funding to keep them afloat. In order to find success with your marketing company, you need to be able to give the business enough time to find its feet and build a positive reputation (key in this industry). Therefore, you need to make sure that you secure enough funding not only to get the business up and running but also to keep you afloat. You need to calculate these costs and then use any method to hit this figure before you start. These days, there are many good ways to secure funding for a startup:

  • Savings
  • Loans from friends and family
  • Bank loans
  • Angel investors
  • Venture capitalists
  • Crowdfunding
  • Grants

Keep Your Costs Down Initially

Following this, when you are starting your marketing agency, it is important to keep costs down to make it easier to manage and to improve your bottom line. Obviously, you still need to be able to provide a top service to your clients, so you need to keep costs low without impacting quality. When business starts to pick up, you could then make improvements and increase spending. A few ways that you can keep costs down when starting a marketing agency include:

  • Remote work
  • Outsourcing instead of hiring
  • Comparing suppliers
  • Automating as much of the business as possible
  • Buy second-hand equipment and furniture
  • Lease instead of buy

Arrange Sufficient Insurance

Insurance may seem like an expense that you can do without, but it is better to be safe than sorry. For a new and small business, it can be very difficult to survive if you encounter a problem that you are not covered for, so you need to make sure that you have sufficient insurance in place from the very start. You should always research your options and compare providers to make sure that you are getting a good deal on a policy that provides adequate protection.

Keep Your Personal Finances Stable

When you are starting a business, you want as much stability in your personal life as possible. This means that you should avoid any major expenses during this time, such as paying for a wedding or buying a house. While your business finds its feet, try to be as sensible as possible with your personal finances so that you do not find yourself suddenly in need of money that you do not have access to without going to a lender. It is also helpful to create a household budget that will allow you to control your spending and avoid falling into financial difficulties.

Speak With A Financial Planning Expert

Leading on from this, it is also a good idea to work with a financial planning expert. A financial planning expert will be able to help you to achieve your financial and life goals by creating a financial plan based on your personal circumstances, objectives, and appetite for risk. Financial planning experts can help with all important aspects of financial management, such as income tax liabilities, reviewing company equity positions, cash flow for retirement, investments, benefit options for employees, and much more. Essentially, this will shape up your business and personal finances and keep you on track so that you can achieve success with your marketing agency and life in the long term.

Invest Back Into The Business

When your marketing agency does start to make money, one of the best uses for this is to reinvest back into the business. When you fund your own growth, you become self-sustainable, and this is incredibly powerful as a business model and should help you to quickly grow and achieve higher levels of success. You will want to identify weaknesses and spend in these areas, but there are a few areas that can always benefit from spending, such as:

  • Marketing
  • Tech and equipment
  • Staff training
  • Research
  • Software
  • Personal development

Think Long Term

When you are starting a new business, it can be hard to look past the next year, let alone far into the future. It would be best if you certainly focused on the present to make sure that the business has a chance of finding success, but you also need to think about your long term finances and what your goals are. You should always be building towards your retirement no matter what is happening with your business, whether you are contributing to a 401(k), investing, or adding value to your home.

Be Patient With The Business

An important tip for starting a new marketing agency is to be patient. It is easy to get disheartened when your business does not thrive straight out the gate, but most companies take a few years to get going. You need to make sure that you remain patient so that you do not make any rash, emotion-driven decisions that could affect both your business and personal life. As mentioned before, it is much easier to be patient when you are building from a position of financial stability, but you should also set small financial goals for the business along the way.

This post should help any marketing entrepreneur to improve their business and personal finances. As an entrepreneur, you need to be smart with money both in terms of managing your company finances but also your own personal finances. This is particularly true when you are building a new business, which can be a challenging time and one of great uncertainty. Smart financial management will greatly improve your chances of finding success and help you retain stability and comfort in your personal life while building towards the future. You need much more than a good business idea to find success as an entrepreneur, and these tips should help you along the way.

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