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Self Employment on a Budget

I have been self-employed for a few years now and although I love it, it does come with its challenges. On some month, I am super busy and my bank account is smiling. And some other months, it can be super quiet. One minute I could be wondering how to pay some bills, and the next minute I could be laughing all the way to the bank. That is pretty much the life of a freelancer/self-employed person. Our income fluctuates and there is so much financial uncertainty but I won’t trade it for a job in an office with a regular pay check. The pros of being a self-employed person massively outweighs the cons for me, which is why I do what I do.

 

You Need a Budget: The Proven System for Breaking the Paycheck-to-Paycheck Cycle, Getting Out of Debt, and Living the Life You Want image

 

 

You Need a Budget: The Proven System for Breaking the Paycheck-to-Paycheck Cycle, Getting Out of Debt, and Living the Life You Want

Having said that, the key to surviving the self employment world is to have a budget. I love reading finance self-help book on my Amazon Kindle. The book I am currently reading is You Need a Budget: The Proven System for Breaking the Paycheck-to-Paycheck Cycle, Getting Out of Debt, and Living the Life You Want by Jesse Mecham. It is the first book I am reading this year and I am loving the budgeting tips and advice. I have picked a lot from this book and I recommend it to anyone struggling to make the most of their money. You need to read this book. It is full of wisdom and valuable tips. 

Everyone needs a budget regardless of what you do for money. Business owners and freelancers need a budget more than everyone else because of the income fluctuations. Having a budget helps you plan your money and make your money work for you. If you budget right, you can survive on periods where work is quiet because you would have saved money from the busy months. 

 

Self Employment on a Budget

I am going to be handling my money a little differently this 2019. Generally, I am good with money but there is always room for improvements, and I plan to be better this 2019. Here are some things I would be doing more of –

 

Ageing my money

Jesse Mecham advises us to age our money. What this means is for us not to spend all of our money as soon as it comes in. This makes a whole lot of sense. Ageing your money allows you think smartly and set your priorities straight. It takes off the stress of having no money in your bank account and it allows you plan your life.  Ageing your money allows your money wait on you instead of you waiting on your money. It sounds pointless but it works. Trust me, I have tried it. The longer you can age your money, the better. I aim to age my money for at least 30 days. It is a work in progress but I am slowly getting there.

 

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Spend less than what you earn

This should be common sense but it is amazing how we spend way more than what we earn. Which leads to us having to use our overdraft facility, store cards and credit cards to make up for the difference. Spending less than what we earn is the way to financial freedom.

 

Grow the savings

Having money saved away is the way to survive self employment. With the income uncertainty, you never know for sure when you would be short, so it makes sense to always have money stashed away for when the need arises. Growing the savings is one of my many goals this 2019.

 

Make more money

2019 is the year of making more money. That is another goal I plan to seriously work on this year. The way to financial freedom is to have many streams of income. I am planning on working hard on making money via affiliates and I am using an affiliate link in this post for the first time in a long time. Having many streams of income means you have various ways of making money. No one should ever rely on 1 pay check.

 

Do you have a budget?

 

*Affiliate link used.

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Self Assessment Tax Returns With HMRC

I have been self-employed for 3 years now. I have filled out 2 self assessment tax returns with the HMRC, and I have another due to be filled in the next few weeks. My experience with the self assessment tax returns with HMRC has been good. I found my first experience a lot more scary than the second. Which is perfectly understandable as that was my very first time submitting my tax returns. But since then, it has been great.

HMRC website is user-friendly and pretty self-explanatory. I found the filling out of the tax returns quite straight forward for me. But that may be because I have a degree in Accounting, and I am married to a qualified accountant. So whenever I get stuck, he comes to the rescue. It could also be because of great online resources like Talk Tax. For those who have never heard of Talk Tax before, it is a great website set up in 2014, that provides hard to reach HMRC contact numbers and articles to inform readers about policy change/benefits/ self-assessment and more.

 

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When it comes to getting important things sorted, like my tax returns, I don’t play. I take it very seriously. I believe in being proactive and not reactive when it comes to tax business. And that has helped me stay on top of my business.

These 2 tips for filling out your self assessment tax returns have come in handy for me, and they may work for you too.

 

Start Early

This is the first and most important tip when it comes to filling out your tax returns. You need to be an early bird, and start early. So when the window opens in April, you get it submitted before the summer months. That way you have the time to spread your tax and national insurance payments (if any). Starting early also means you will have the time to take your time filling out your tax returns properly.

When you leave it all until the last-minute, you start to panic so you rush, and you are more likely to make mistakes. You may also have to go into debt to pay your tax bill if you are not prepared. January 31st is the cut of date for self-employed self assessment tax returns, and many people struggle to pay up their bill before the end of January since most of the money has been spent on the Christmas shopping. Plus January is usually a quite month for most businesses. Which is why I like to get mine done long before then. Don’t leave your tax returns until the last-minute.

 

Keep Records

Starting early would work great if you keep records. Ensure you have a spreadsheet for every invoice you send and for any money I spend or receive. Having records will ensure you fill out your tax returns with the right figures quickly. It makes the process a lot easier.

The last thing you want is to fill out wrong information on your tax returns. That would land you in trouble quickly with the HMRC. Having up to date records means you won’t have to guess any figures.

 

Many people are usually frightened when it comes to anything tax related and I understand why It is because they are not well equipped and usually not informed. There are loads of information around to help you submit your tax returns yourself and if you are unable to do so, you can always hire someone else to sort it out for you.

Remember, if  you don’t complete a Self Assessment return for each tax year before the deadline, you will get a penalty fine. This penalty starts at £100 for delays of up to 3 months but will increase the later you leave it. HMRC may also charge you interest on late payments. So ensure you get your tax returns in before the deadline.

 

How do you find the process of submitting your tax returns? Easy or complicated?

 

*Collaborative post.

Are Entrepreneurs Born or Made

For as long as I can remember, the question of whether successful entrepreneurs are born or made has been a subject of debate. I thought I’d give my own two cents to this debate from my own perspective.

Many people go into entrepreneurship for many reasons. Some want to really experience the freedom-based lifestyle that goes a long with entrepreneurship. Others are in just for the fringe benefits that come along with tagging the word “entrepreneur” in their bios.

Whatever may be the reason for diving into entrepreneurship, the end speaks for itself. The true entrepreneurs remain resilient until the very end, while those who are not cut out for it are easily weeded out.

 

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But what makes the real entrepreneurs who they are? Is entrepreneurship something they pick up and train themselves in or are they just born with all the skills, character and talent to be entrepreneurs?

Let’s look it from both sides:

 

Entrepreneurs are born

It could be a gene in their DNA but some entrepreneurs are gifted with the skills that give them an edge in their business. While some have to train for years before they can perfect the art. Born entrepreneurs have natural instincts geared to making their businesses work.

Take for example, having a natural gift in creating quality relationships that always result into sales. It’s not that such a person was trained to be a good communicator. It’s something that flows naturally.  They never have to force themselves to shine in their area of competence. They are excellent at what they do.

Born entrepreneurs are those who recognize that they have a gift and they exploit it; they leverage on it.

 

Entrepreneurs are made

Made entrepreneurs are those who develop the skills needed in order for them to be successful. They know that there is a gap and in order to make their business flourish they have to fill in their lapses. As a result they get retrained, they hire coaches, they read books, but most of all they practice, practice, practice.

The truth is that this is where majority of entrepreneurs find themselves at a point in time. Their success is attributed to the work they put in themselves and as a result their business became a success.

 

If you want to be an entrepreneur and fail to see your lapses or you’re not ready to learn and practice then you will not be successful in your business. You need to be willing to make an effort. Developing yourself takes time and a lot of humility. You need to be humble enough to acknowledge that there is a lot to learn and actually put in the work and take the time to practice.

 

So are entrepreneurs born or made? I believe some are born but most are made. Being born with the right skills and business mindset is all well and good but you need to continue to develop those skills to be a success story.

 

Do you agree? Please share your thoughts in the comments section below.

 

 

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