Advice for entrepreneur – Be responsible

Entrepreneurial success comes with the streaming in of profits. After a lengthy period of struggling, when the cash starts flowing in, many entrepreneurs are often caught out. But don’t despair, Inspire Mzansi is here to equip you with valid entrepreneur skills that will whisk your aspirations into founded reality

Don’t let personal finances crumble while making business finances sound.

One of the trickiest parts of owning a start-up is learning to manage finances. You have to control cash flow as you (hopefully) edge towards making a profit, stick to a budget, and build an emergency fund for lean times. But it’s also important to ensure your personal finances don’t crumble while you’re making sure your business finances are sound.

Here are tips to help you stay on top of your personal finances while your start-up takes off.

Keep them separate

The most important tip is this: be very strict about keeping your personal finances separate from your business finances. It’s important to treat yourself as an employee who earns a set monthly salary, and not to use the business finances for your personal expenses. If you allow your business and personal finance boundaries to blur, and your business goes bust, you could be held personally liable for debts.

You have the power to put yourself into a position where you turn your business around.

Focus on eliminating debt

Find ways to pay off your debts. This will give you the edge to move on forward

Give personal finances as much attention as professional finances

You should forecast your finances, document your expenses, have a budget, know what you’re spending on. Look at how you are bringing in money and how you can make the most of that money.

Don’t get into personal financial trouble

Make sure you have a solid credit history and don’t get into any personal financial trouble. You might need a business loan to expand your business in the future. Start by tackling those credit accounts with the highest interest rates. If you have multiple, smaller loans, look into debt consolidation (but make sure you understand all the risks and red tape).