By means of budgets, it is possible to calculate how much it costs to set up a business and how much it costs to keep the business running.
Budgets, for many entrepreneurs, are one of the worst things about starting. They are afraid of it and think that only accountants can make budgets. It is not true.
Budgets are rather simple to make. It is simple addition and multiplication. Just take it one expense at a time.
For a start-up company, you might need to purchase 5 chairs for the office at $50 each. The line in the budget will say:
Budgeting is that easy. One line at the time and then use your skills in addition and multiplication.
In the budget part of the business plan you can download budget templates and you are asked to make the following budgets:
In order to estimate how much money you need before the start-up of the
business, you must work out an establishing budget.
Read more about establishing budget.
The operating budget provides an
overview of the costs of running your business. The operating budget gives you
an overview of the company’s day-to-day expenses. It also gives you a chance to
calculate an estimated turnover.
Find out more by reading about operating budget
In order to figure out your need for cash at the
end of each month, you have to work out a cash flow budget.
A cash flow budget is a chronological overview of expected income and expenses over a given period of time – oftentimes a month.
Read about cash flow budget
Go to Download Center and find the templates in which you can make your own budgets.
Remember, either you control your money or it will control you.
- T. Harv Eker, author and speaker