Working from home can provide you with an immense amount of freedom compared to most people who work a typical 9-5 job; many would love to have that luxury. However, when working from home, as someone who is self-employed, taking control of your finances can be a difficult and often daunting task. With no guarantee of work, it’s important that you maintain and look after your finances when running a business or your employment from home. Here are a few tips, if you’re new to it all or just need help with your money.
Record All Your Expenses
If you’re running a business from home or working for a company but doing so remotely, it’s good to record all of your expenses so that you can claim this back either through the tax man or via the company who has employed you or contracted you to complete the work. The importance of recording your expenses is critical because those who are self-employed, as an example, don’t get the same luxuries like paid holiday time, sick leave and pensions. Therefore, you need to get all of the help you can get in reducing any taxes you pay back.
Use Accounting Software
Technology is a wonderful thing, and using AccountingSoftware is a great way to keep track of your finances. Although plenty of independent individuals and big businesses out there can do your accounting for you, you might find you can do it all yourself with software that can be downloaded straight onto your computer. It’s a great way of streamlining everything from your expenses to invoices, banking to time management. If you’re working from home, you might also not be able to afford or need the use of a big company to manage your finances. Accounting software that you can navigate yourself is probably going to be much more financially beneficial in your position.
Set Yourself a Budget
Budgeting is something that everyone should be doing in order to curb overspending and spending money that you don’t actually have. There’s nothing nice than working all month on various projects, spending money like it’s going out of fashion but then realize that you’re running short. Then you have to face the prospect of eating toast for every meal over the next few weeks. Businesses budget their money too, so make sure to set yourself a budget each month. Calculate how much comes into your bank account each month (or estimate if it’s not consistent) and then note down all of your expenses from your household bills to how many times you’ll eat out. You should always have some left over that you can set aside and put into savings. Any remaining money that’s left is yours to do with as you’d like but if you’re already finding that you are spending more than your earnings, you’ll need to cut something back.
Have Something to Save For
Even if you don’t actually intend to spend it, think of something that you want to save for. This can really help with keeping you motivated and steering you away from making bad choices when it comes to spending money. So perhaps it’s a luxury holiday destination you’ve always wanted to go on or an extravagant wedding that you and your partner would like to have. Again, the reality is that you don’t need to use this money for what it was intended for, it just gives you that drive and conscious thought to save any money that you are able to each month or whenever you get an extra bonus of cash that you weren’t expecting.
Get Cheaper Energy Bills
Your household bills are something you have to pay for, and these can be quite costly when you start working from home. You no longer spend several hours of the day out of the property, so of course, your energy usage will increase and therefore the bills will go up. It might be a good opportunity to check with your current providers on what deal you have with them and shopping around to see if there’s anything cheaper. Getting quotes from your provider’s competitors will likely work in your favor, as they’ll want to try to match them in order to keep you as a customer.
There are ways of reducing your energy bills in general either way. Avoid turning on any lights where possible and use natural light throughout the day. Restrict the number of times you use your kitchen appliances and keep the heating on low if you need it on.
Put a Block on Any Shopping Sites
Part of the problem when working on the computer is the access to the internet. That can cause distractions and procrastinating when perhaps you don’t want to focus on work for the next ten or fifteen minutes. Nevertheless, with this time, it can be dangerous because you may find yourself on a shopping site. You can help yourself ahead of time though by putting a block on any shopping websites that you usually go on. The times where we buy online are through stress or boredom, so cut it off while you’re working. Online shopping can be a slippery ladder to spending your hard-earned money and although sometimes it’s needed, during your ‘working hours’, you shouldn’t have any access to it.
Working from home and being in control of your finances can be hard. There’s being unaware when each invoice gets paid or how little or large your expenses might be for the month. However, you can be smart by setting yourself a budget and investing in some accounting software to assemble your finances all in one place. Look into how much you are paying for your energy bills and then see if you can get a better deal elsewhere. Enjoy the freedom of working from home and being on your own time, but be wise when it comes to your finances because if you don’t, you may be sacrificing this luxury.