In order to open up your own business, you’ll need quite a bit of personal capital to get you started. Whether your plan is to open your business’s doors in two years, five, or 10, it’s important to begin saving as soon as possible.
Now, we know that your income revenue may not be the strongest when you’re 20-something, but you can still save up little by little. After all, everything really does count. Saving (even small amounts) will also help you to build a solid foundation of good spending habits for your future. That way, future you won’t be thinking, “I was such an idiot.” Follow these tips to be well on your way to opening your own business.
Set some goals
Setting achievable goals is one of the best ways to build up a nice little emergency fund that you can stick to. While saving $3,000 may seem completely unreasonable as one chunk, breaking it down into smaller, more manageable goals is way easier. Think about starting small and set a goal for yourself to put aside $25 dollars every pay check. Or if you want to go big and set aside $250 dollars, you can do that. Either way you will thank yourself when those amounts add up, allowing you to open your business sooner.
There are plenty of money saving apps out there that are designed to help you squirrel away small amounts inconspicuously. When you manually put money in your savings account, you always know about it. You know that money is sitting in there, mocking you with its availability. But these apps connect to your checking account and track your spending habits so that when it takes small amounts, you aren’t supposed to notice that the money is missing. It may seem shady, but it’s actually brilliant. Even better is that the money isn’t technically in your main account anymore, so you won’t see how much you have unless you pull the money saving app up. Most of them even allow you to set goals and it will take out however much it needs to every week or so to ensure that you meet your goal. And don’t worry, they aren’t ever supposed to overdraw your account and transferring the money back into your checking takes mere days.
Save little by little
Taking on remote work is a great way to save up money little by little. Can you blog about your favorite movies? Offer a dog walking service to neighbors? Design new logos for internet-based companies? It may not seem like a lot, but every little bit counts and if you put all of the money you make from side jobs into one savings account, you may be pleasantly surprised when a couple of years later you have a few thousand stored up. Check out available freelance jobs on Remote.com.
Find the right credit cards
If you love to travel, you may as well choose a credit card that offers stellar travel perks, such as air miles for all purchases. While some of the best cards out there do come with an annual fee, there are plenty of credit cards that are totally free to have and still accrue points. Just be careful, because if you don’t pay off your credit card in time, you may end up paying some pretty hefty fees.
Invest in your retirement
If your current employer offers a 401(k) retirement plan, take them up on the offer, especially if they match a certain percentage of your contributions. You can also set up an IRA (a Roth individual retirement account), which can be used as an emergency fund if you’re already self-employed. Both options should be regarded as “don’t touch” savings, especially since you will pay a penalty if you withdraw from your 401(k).