You need to save to cover those unforeseen expenses that will appear when you least expect it and, above all, at the worst moment.
New Financial Problems
- Vacation: Paid vacations are over. Until you have your business working like a machine, generating passive income, the day you do not work or earn money.
- Taxes: If you have income, you must pay taxes for your new work condition. If you earn more than $3,000 a year, I would hire an advisor or manager to take me to the subject.
- Retirement: You will have to save for your retirement. As it also happens to the self-employed, you must dedicate a part of your monthly salary to save it to prepare for retirement. It is possible that by that time, your business is already fully automated and is generating money while you are lying on a paradisiacal beach, but you may not. Better to be cautious.
Income from Your Business in the Cloud
There are two key points to the income generated by your business:
- For a few months, you will not have any income.
- When you have it, the income will be very variable every month.
To solve these two problems, it is essential that:
- Have an emergency fund to survive when you do not have income.
- At least this emergency fund must be one year of expenses. And if it is something else, pulling a year and a half better. You will work calmer and with less pressure.
Focus on Creating a Minimum Income that is Generated Each Month
Initially, your goal should be to achieve a minimum viable audience because you will not win much if you do not have one. Once achieved, direct your steps to create an info product or a service that reports a fixed income every month. However small it is.
That will give you financial stability and, with time, is in this fixed income on which you must work so that it increases as much as possible. Creating new products and services, improving existing ones, etc. Extra income is welcome, but do not count on them. Organize your finances around recurring income.
What Conclusion do we Draw from All this?
Do not leave your current job and launch yourself into a personal business in the cloud 100% until you have completed your emergency fund and created your minimum viable audience. And if you can, the ideal thing is for you to jump when your business in the cloud is paying you a decent salary. There is no need to do it the other way around, and you will save yourself a lot of headaches.
Expenses of Your Business in the Cloud
You must start thinking about expenses as a company. That is, he attacks these two types of expenses in-depth:
- Fixed expenses: Eliminate all these expenses to the maximum. Initially, it would be best if you only had the cost of the domain, hosting, and derivatives of your mailing list. Nothing until you see that your business works and begin to enter some money. Then your main fixed expense should be your salary.
- Variable expenses: Avoid them, except if more than an expense is an investment. Suppose you buy a plugin to start monetizing your mailing list; fine if you spend $200 because you want to change your blog’s logo, bad.
Concerning expenses, other aspects that you must consider are:
- Avoid borrowing. Avoid as much as possible borrowing and borrowing. In this type of business, which starts with a small investment and can grow and improve with the income generated, it is unnecessary to go into debt and have financial problems.
- Learn. Read everything you can about how to manage the finances of a company. Many tips are valid even if “your company” is just you alone.
- If the money is not in your pocket, you still do not have that money. If client X owes you some money until you have paid it, do not count on him. And on the contrary, if you must pay for a service or a freelancer you have hired for a specific task, for example, eliminate that amount of money as soon as possible even if you do not have to pay immediately.
Except for the initial money to set up the blog and the expenses derived from starting to generate income, you should not get more money out of your pocket for your business.About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.