Being self-employed is a beautiful thing. The variety it provides me and the flexibility it affords my family is (excuse the pun) priceless, and it is what keeps me going through the harder times.
And very sadly, times are hard at the moment – unpredictable at best. The news is a depressing read and the financial uncertainty can make being self-employed a scary place to be!
What is the answer? Well, in all honesty, I just don’t know – I am not an economist! However, what I do know, is that I have taken my business through a pandemic which included a period of 90% reduction in income and not qualifying for government support. But I have come back stronger for it.
So, through this blog I am going to share ideas of how you can efficiently manage your finances as a Virtual Assistant to help you ride out these unpredictable times until we hopefully get on some more solid ground!
Build an emergency fund
The work when you are self-employed comes in peaks and troughs. I have periods where I have to turn work down, and others where I am worried about the status of all my client accounts!
You simply have to have an emergency fund to ensure that during the drier spells, your essential spending is covered. I’m talking about your mortgage, bills, food, travel – everything that you absolutely need in your life to be able to function. Three to six months’ worth is often deemed to be a reasonable amount but this will obviously vary depending on circumstances. If you find yourself in debt, then know that you have options. Learn more here.
Make cutbacks on your expenditure
When was the last time you went through your business expenses?
We all have those direct debits that sneak through each month unawares! Maybe it was a subscription with a free trial period that lapsed and you have been on a monthly fee since, but you haven’t used the service? Cancel!! And don’t just cancel, get in touch and see if you can have a refund as you haven’t used the service. They can only say no.
If you have an accountant, go one better and ask them to tell you where you can make savings – they know the ins and outs of your business and will be able to advise on efficiencies that can be made.
Prioritise your spending
I recently cancelled an SEO subscription of £29.99 per month. It was a useful service, but I had some major personal bills coming up with building work at home, and spending that amount each month to find out my site ranked for certain keywords didn’t feel like a priority!
I was also getting into using a hot desk in an office setting, but whilst it was a nice place to go and I was productive whilst there, their prices went up, as did petrol prices (it was a 15-minute drive) and so I just had a word with myself and thought what else I could do with the money saved on a weekly and a monthly basis.
Family time is a priority for me, so if that money saved could be better spent on a family trip or a meal out as a treat each month, then that’s my motivator right there.
Increase your Virtual Assistant income
Everything is going up around us and your business is no different. If you work from home, your expenses are going to be higher, and that should be reflected in your fees. We are seeing exactly the same concept being applied to all of our bills.
It’s a tricky one to balance as client relationships can often be mutually beneficial and run deeper than just the fiscal benefits, but don’t be afraid to at least let your thoughts wander there and sit for while to think about the possibility.
It is also worth thinking laterally about passive forms of income you could generate. Could you create bundles of documents to sell as downloadables? Could you host advertising on your website? Get creative about some additional income streams.
We often see that out of adversity comes opportunity. These unpredictable times we find ourselves in could be just the catalyst you needed to re-invigorate your business and manage your finances as a Virtual Assistant. And these situations never last….my Virtual Assistant rising like a phoenix from the ashes of Covid is testament to that.