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Most entrepreneurs typically start businesses with hopes of generating income DOING SOMETHING THEY LOVE!
We spend a lot of time trying to figure out how to generate sales, make more money and grow profits. But what should we do with that income and how should we manage it better to maximize success?
Here are 5 great tips to help you manage a successful photography business and build true wealth at the same time.
This may seem like a simple truth, but did you know:
In a society that's growing more and more materialistic, it may be good to remind yourself that everything doesn’t always need to be NEW. Find creative ways to cut spending – like buying slightly used camera equipment, props, clothes, etc – even if you don’t need to, it all helps in the long-run.
Once you start generating income with your photography business, make sure to set aside a portion of that money to cover your taxes.
I know it can be tempting to pull out an extra couple hundred dollars each month from your business bank account just because it’s there, but before you do that, you should set aside around 25-30% of your net income.
If you are a sole proprietor or LLC, you will need to pay 15.3% in self-employment tax, plus federal and state income taxes, so it’s better to be on the safe side and have that money saved up. If you don't, you may end up with a large tax bill you can’t pay at the end of the year!
Besides setting aside funds to cover taxes, you should also put a portion of your income each month into a savings account – I promise you won’t even miss it, especially if you do this from the get go!
You should ideally have 6 months worth of living expenses set aside in an emergency fund. Is there something big you want to purchase? Make a goal for yourself and decide how much money you want to put toward your goal each month. Then, when you reach your goal, it will be so much more rewarding than if you just put it on a credit card!
Many people don’t even know where their money is going. With all the great apps and free programs, it’s worth a little effort to figure out where spending needs to improve. I recommend the MINT App – it’s free and will connect to your bank accounts, credit cards and investments. It only takes half an hour or so to set up a budget and get it rolling. Try it!
Nothing helps provide a little perspective quite like giving money to the less fortunate. Sponsoring a child in a third-world country can be as little as $30 a month and serves as a great reminder that we are blessed! This time of year, local food banks also need all the help they can get. If you’re short on cash, give your time! Find something that speaks to you and then SUPPORT IT.
More than anything, it’s important to have goals and a plan to get there:
Do you have any questions or comments about Running a Successful Photography Business? Just leave us a comment below - we would LOVE to hear from you! And PLEASE SHARE this post using the social sharing buttons (we really appreciate it)!