16 Aug Tips for Reducing Your Expenses
Follow these ‘Tips for Reducing Your Expenses’ to identify ways to help lower your expenses. These can be applied to both your business and your personal finances.
Make a Plan
You need to evaluate where you are at now in your business or personal finances where you want to take it in the future. Get really clear on your values, goals and what excites you and make sure your plan aka budget aligns with these values.
We have budget templates available for you to use or you can make your own. For a comprehensive approach to business planning, talk to us about our Business Planning workshop which breaks down large goals into manageable steps and 90 targets.
Know Where Your Money Goes
Tracking your expenditure is not just about annual taxes. Tracking expenses shouldn’t be an after though, it needs to be an integral part of your ongoing strategy.
If you have accounting software you can easily track your expenses on a weekly or monthly basis by keeping you coding up to date and running regular profit and loss reports. You can tailor these reports by showing monthly totals for the financial year and comparing against your budget.
For personal finances, there are a number in inexpensive apps you can use to track your expenses. If technology isn’t your thing a simple spreadsheet or even writing down the expenditure will help.
Make sure you track both your income and your spending. This gives you are clearer idea of how your money is coming in and going and will allow you to evaluate your financial habits over time and see what kind of patterns emerge.
Get Tough on Costs
It’s easy to become complacent on expenditure , especially re-occurring costs and small monthly subscription. Look closely at expenditure and see how it has changed over the years looking for “lifestyle creep” Look out for ways in which you are “Nickle and diming” yourself, where many small and insignificant purchases ( a coffee every day $1300 pa) can jeopardise more rewarding purchases ($1300 towards holiday) .
Make sure your expenditure matches your values and objectives. If your business objective is to grow your sales and profits make sure you’re spending on product development, sales, marketing, business advice and training.
Pay Off Your Debts and Reduce Interest
If you want to reduce expenses and save money, this is a no-brainer. Get out of debt. There are many strategies to pay off debt and depending on how much debt you have it will require commitment to pay it down to zero. Set a target for your to get out of debt and do what it takes to make it.
Avoid Impulse buys
Yip, even businesses can be subject to impulse buying. Every business should have a budget, and monitor it when planning expenditure. Sometimes deviating from the budget is necessarily for instance unplanned repairs or maintenance or a unique business opportunity presents. Sometimes though, impulse expenditure is just a distraction from the main goal. Carefully access expenditure and avoid spur of the moment decisions
Our ‘Tips for Reducing Your Expenses’ not enough?
The better you understand your business and your financials, the easier it will be to make more money and ultimately achieve your goals. We have developed comprehensive resources to enable business owners to fully understand and interpret their numbers. Need more help? Join our free webinars on financial awareness coaching or talk to us about personalised financial awareness coaching. Contact Samantha for a call, zoom or meet on 06 871 0793.
Related Links:
7 Ways to Save on Accounting Fees
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