With more people than ever opting to start their own small business, entrepreneurship has become an attractive way for people to make a living. Small business owners enjoy the autonomy and typically have a passion for their life’s work. Despite these great things, being a small business owner can take a toll on your finances if you don’t have a lot of experience in your industry. Here are some simple ways you can help save your cash if you are new to starting your own company or if you’ve been running your business for years.
Have a Virtual Office
First, consider eliminating the traditional office from your business plan. Instead, choose to have a virtual office for your venture. This can help cut out costly expenses, such as rent, utilities, and gas for your commute. With the widespread availability of fast internet and mobile technology, many small business owners have opted to go virtual and increase their profits.
Use Independent Contractors
Next, consider taking on independent contractors for your big projects instead of hiring new employees. Some business models can staff their entire workforce with contractors, saving them thousands of dollars. This setup can help you reduce the cost of employing people, lower your benefits plan costs, and cut your employment taxes spending. Avoid having regular full-time employees classified as independent contractors, though. This could cause you big problems with the IRS.
Maximize Tax Deductions
Another place to save money if you’re a small business owner is through your tax deductions. Before you start your new business, consult a qualified tax professional who can advise you about what kind of expenses you should be writing off each year. Keep records of all of your spending, hold onto receipts, and put everything into a log or computer program to organize all of the details for tax time in April each year.
Inquire About Lower Insurance Rates
Opening a new business also means you’ll need a new type of insurance plan. In many cases, you can talk to your agent to get a bundled plan to cover your personal insurance costs, such as car insurance and homeowners, and your business insurance needs, such as liability. Following these important insurance tips could mean the difference in saving thousands of dollars per year. And, best of all, you’ll still have plenty of coverage for the most important things in life and your business.
Take Advantage of Small Business Incentives
The last thing you need to do is research any small business incentives offered in your local city or state. You may qualify for low-cost loans, grants, or other incentives depending on the industry you work in. The Small Business Administration and your local chamber of commerce may be able to help you turn a young venture into a long-term success. It can be tough for new business owners, so be sure you’re taking advantage of all of the resources out there that can help you find financial gain.
Don’t let the stress of being a small business owner take over your vision for a strong financial plan. Focus on your goals and use these tips to help save your money over time and turn a profit sooner.