6 Tips to Feel Financially Secure for Your Business or Nonprofit
2020 has been a wild ride thus far and the uncertainty caused by the global pandemic has meant questionable, sometimes scary, times for all business and nonprofit owners. If you’re a business owner and you feel threatened by the economy, you are far from alone. We’ve gathered together below a list of six of the greatest tips to help make you financially secure as a business or nonprofit.
Leverage the Need Your Business Fills
The best way to ensure financial security for your business or nonprofit is to believe in your product or service, and what it can do for your customer. If you’re selling or offering something fabulous, something you can fully stand behind, and something you know is addressing a specific need in your target clientele, chances are you’re already ahead of the game. The next step is to figure out how to reach your target audience. Spark enthusiasm amongst your customers by giving them outstanding treatment. With steadfast commitment to selling your services to the right audience with authenticity, you can build a solid, financial foundation. Risks backed by good intentions and built on earlier successes are oftentimes rewarded.
Have a Backup Emergency Fund/Rainy Day Fund
A nonnegotiable for financial stability as a business or nonprofit owner is a backup emergency fund. Everything may be running smoothly until suddenly it’s not, as many business owners experienced in the wake of 2020’s crises. Be prepared. The best offense is a good defense in these situations. One of the worst, and most common, things that can happen to a small business or nonprofit is to be wiped out but an era of low earnings. You must prepare for slow periods. This safety net will be key in making sure you can weather any unfortunate storms your business or nonprofit might face. As we know in life, nothing is guaranteed, so if you can keep your savings fat, you’ll be in much better shape to handle unexpected expenses and low earning months.
Make Paying Off Any Debt You Have a Priority
Debt is easy to acquire and difficult to pay off. Before you receive more costly “handouts”, handle your debt. Being in debt can be overwhelming. Take a deep breath and don’t allow yourself to get stressed out by the huge number if you’re in significant debt, but do make a plan. How much money each month can you reasonably put towards paying off your debts? Chip away a month at a time but make paying anyone you owe money to a priority. In the future, try not to rely on credit and spend only the money you actually have.
Set up Monthly Automatic Payments
A quick way for you to spend unnecessary money is to get screwed by late fees. If you have monthly bills that need to be paid, do yourself and your business a favor and set up automatic payments. This is a simple and logical step towards becoming financially stable. Not to mention, this takes pressure off of you each month when the bill arrives, since when you set up monthly automatic payments, it’s already done and you can better spend your time making savvy business moves.
In addition to setting up payments your business needs to pay, you can also set up pre authorized debits for the payments your business needs to receive. This ensures that your incoming payments are collected on time, improving your cash flow and overall financial health. There are companies offering these services to help you manage your business funds more efficiently. By leveraging pre-authorized debits, you can streamline your accounts receivable process, reduce administrative burdens, and ensure a steady flow of revenue.
Get a Grant
Ensure your business or nonprofit is eligible for grant funding. In order to do this, do your research! Know your business inside and out and be prepared to make a case for why you deserve funding. We can’t stress enough that there’s no such thing as being over prepared when you are asking someone to write you a check to support your business or nonprofit. Why does your company deserve funding over someone else’s company? What is your company’s mission and why is this significant to the people you are asking for money from? Be confident in your business or nonprofit. There are plenty of people out there with money looking to support you, you just need to find the right fit.
Grow Your Team Only when Necessary
A common misconception about businesses is that in order to be successful, you have to expand rapidly. This is absolutely not the case. Make intelligent decisions when it comes to growing your brand, business, or nonprofit. Steady and slow growth wins the race. You don’t want to be in the position where you’re taking on salaries you can’t afford just because you’ve overextended yourself to hire a larger team than is required. Eventually, you may be in the position to take on more employees, but don’t rush this process.
The beauty of financial security is that it allows you to actually enjoy running your business or non-profit. Prior to becoming a business owner, you’re going to want to prioritize getting your finances to a place that you feel comfortable spending money. Owning a business, especially in the beginning, isn’t cheap. By following these six tips and remaining open to innovation, you’ll be well on your way to financial stability and better fit than ever to successfully run your business or nonprofit!
Katie Tejada is a writer, editor, and former HR professional. She often covers developments in HR, business communication, recruiting, real estate and finance, but also enjoys writing about travel, interiors and events.