Organizing your Personal Business and Finance

When we hear the word “finance”, primarily bring to mind concepts such as numbers, money, accounting, tax laws and, in short, a scenario that we prefer to be away.

While we cannot all be accountants in this life, we all have the basic knowledge of how the finances of a business or Why not? Our company work.

The Royal Spanish Academy defines finance as “someone assumes the obligation to answer for the obligation of another person”, just the activity performed by the accountant, who explains in less complex terms, the requirements of many institutions, of which sometimes we cannot even remember his name.

But a couple of questions arise: Why we do not engage and give importance to something that is ours how is it that we give so much confidence?

Gentlemen, start a business means, in short, basic knowledge of finance, a simple formula such as:

This allows us to see from another perspective how business is. Perhaps many times the workload we size not what is happening in our pocket, we are dedicated solely to the operation and subtract relevance to the engine of our business, what sometime determines growth and investment decisions.

Once we have understood the importance of finance, we proceed to the analysis, the point at which the comparative lead us to have better control over all expenditures to do so we can wisely manage economic resources that count.

We will give a simple example, if one month we spend $ 1,000 to produce 10 articles, and the next we spent $ 1,200 for producing 9 items well be worth analyzing the reasons for these variations, possibly up the cost of any item, or we just got several days afternoon and had to resort to using a taxi and then derived the variations.

To be successful in your business, you should not let pass any “leakage” that can get to hinder productivity you have, always with the philosophy of doing more with less and with excellent quality, thorough and careful management of our capital will lead always to a healthy and stable financial position.

This is for specific and strict records of each discharge generated, always justifying the reason for it, as well as income, for at least know how many our profits or losses are made up and watch its behavior in the coming weeks and months.

The analysis should be to such a degree that we can distinguish the financial transactions that are reflected in our company, what their variations and trends by external or internal factors, determine the trajectory of the organization are.

So get to work and not let the handle counter what is ours, to detail maybe I will, but we have an obligation to know the guidelines that the company takes over time, up to consolidate.

Managing your Business and Finance

When you start a personal business full-time in the cloud based on a blog to sell products or professional services, you must not forget how to organize your personal finances, or how to manage the money generated by your business.

Moving from a traditional job to a business of this kind will force you to make a series of adjustments to you day by day and an even deeper your finances control.

At the beginning of the article I will focus on personal finance and then in the finances of your business.

Staff Salary

I think it is essential that when you can, you put a personal salary. And this wage should be part of the revenue generated by your business.

This salary is managed as if it were the money you earned before the company in which you worked.

To properly manage the money generated by your business, to invest in it, which generates pay the expenses you have, you must have a salary. Separate your personal money, the money in your business. No never mix.

The money you earn your business in the cloud should be completely separated from the staff and vice versa money. Have a separate account, a different card, and more.

If you need to borrow from the “other side”, write it down and mark the same conditions that would demand back to others in the same circumstances. Any personal expenses paid with personal money. Business expenses with the money generated by the business.
Personal Savings

It is essential that you save an important part of your salary. More so because the income of your business is likely to resemble a roller coaster and sometimes can pay you what you circled and sometimes much less.

The more unstable your income, the more they need to save. If your traditional salary save 10% -15%, you should now increase to 25% -30% at least. If not more.
Why so? Good because you must now pay a number of things that had not had to worry about (or not) and they do not disappear earlier concerns.
Previous financial problems

Contingencies. You still need to save to cover those unexpected expenses that appear when you least expect it, and above all, at the worst time.
Financial problems new

Vacation: paid holidays are over. Until you have your personal business to operate like a machine, generating passive income, you do not work that day, that day do not make money.

Taxes: If you have income, you must pay taxes on your new employment status. If you are earning more than 3,000 Euros a year, begin to hire a consultant or manager that will take me theme. On this particular point you have a lot of information on the blog Borja Prieto, Unchained.

Retirement: You’ll have to save for your own retirement. As also happens to self, you have to dedicate a portion of your monthly salary to save it to prepare for retirement. It is possible that by this time your personal business is now fully automated and you are making money while you’re lying on a beach paradise, but also may not. Better be careful.

Income from your personal business in the cloud

There are two key points in relation to the income generated by your business:

For a few months you will not have any income.
Revenues when they have been highly variable each month.

To solve these problems, it is essential that:
Have an emergency fund to survive for months in which you have no income.

At least this emergency fund should be a year of expenses, and if it’s something more pulling a year and a half the better. You will work quieter and with less pressure.
Focus on creating a minimum income generated each month.

Initially your goal should be to get a minimum viable audience because shortly going to win if you do not. Having gained Raise your foot to create an information product or service that you report a fixed income every month. For small.

That will give you financial stability and with the passage of time is in this fixed income on which you must work to increase everything.

Creating new products and services, enhancing existing ones, etc., Goodies, income is welcome, but do not count them. Organize your finances around recurring revenue.

Do not leave your current job and you launch into a personal cloud business 100% to have completed your emergency fund and created a minimal audience feasible.

And if you can, ideally, is that when the leap and your personal business in the cloud you are paying a decent wage.

Business expenses from your personal cloud

You should start thinking about a business expense. That is, attacks fund these two types of expenses:

Fixed Expenses: Removes all these expenses to the maximum. At first you should have only the cost of the domain, hosting and derived from your mailing list. Nothing until you sees your business works and start entering some money. After your main fixed cost must be your own salary.

Variable Expenses: Avoid them, unless an expense rather than an investment. If you buy a plugin, as you OptinSkin to start monetizing your mailing list, either. If you spend 200 Euros because you want to change the logo on your blog, wrong.

In relation to costs, other aspects you should consider are:

Avoid borrowing. Avoid as much as possible into debt and borrow. In this business, you start with a small investment and can be growing and making improvements that generate income themselves, walking is totally unnecessary borrowing and having financial problems.

Learn. Read everything you can about how to manage the finances of a company. Although “your company just be yourself, many of the tips are valid.

If the money is not in your pocket you do not have the money yet. If the X client owes you some money, until you have paid so do not count on it. Conversely, if you pay a service or a freelance you have hired for a specific task, for example, eliminated as soon as possible that amount of money but do not have to pay immediately.

Except the initial money to start the blog and the costs of start generating revenue, should not leave more money in your pocket towards your business.
Investment in your personal business in the cloud

If you want your business to grow you must invest in it. A personal cloud business has 3 types of expenses:

Domain, hosting and expenses to generate revenue first: Will the first expenses you have and your first investment in your business. They are low costs, between 100-150 per year.

In addition to these costs, you may start to get the first income Thing put some more money, for example, in areas related to your mailing list or the development of an information product quality comercializarás then.

People to help you: Once you start having recurring revenue to improve the quality of your content, products and services should hire people to help you or be devoted entirely to the tasks you like least and especially the less weight on the business benefits are.

For example, to manage everything related to wordpress (plugins, backups, updates, etc.) in hosting with design etc. But keep in mind that whenever you try to pay someone for a particular task, and that if a fixed cost become more, that you really worthwhile.

You center yourself on your content work, your products and your services. You can find great freelancers on Elance and Odesk.

New tools and payment services: As your blog grows certain services or plugins you use will no longer be free or to take a leap of quality you should start using paid versions. For example, if you are using Mailchimp to manage your mailing list from a certain number of subscribers no longer free. – Wikipedia

Or if you want to start further monetize plugins need to pay as OptinSkin. If you make videos, the camera your brother and free the top editor’s okay to break the ice and see how it works, but if you’re serious (and you’re going, because your income depends on it) need a good camera and a good editor.

So many things do not be afraid to invest in this area, provided of course, you know that spending will impact on higher quality and thus higher revenues. If not, it’s not an investment.