STARTING YOUR OWN BUSINESS IN THE MOTOR TRADE

Whether you are already in the process or just considering the idea of starting a business, it can seem like a costly endeavour. Most companies are launched with small investments but there can be many different costs involved with any new venture. These costs may not always be clear from the beginning.

If you are planning to start your own business, it is very important that you correctly calculate all the potential costs you may have, and to also make sure you have enough money to cover this. Irresponsible budgets and not planning for unexpected costs are just two reasons why many businesses can fail. You must try to make sure you have enough capital to sustain your business over any given period. So which costs do you need to consider before starting a new business?

The business

Many new businesses owners do not seek the right professional advice before starting their new journey for the first time. The planning stage is one of the most important aspects to consider when starting a new venture. You may require specialist advice on the financial and legal aspects of the business. When creating a budget sheet, remember to include any costs for accounts and legal consultation. You may even receive your first consultation free of charge from an accountant or solicitor, especially if they want to attract you as a long term client themselves.

Incorporating the company

You may choose to register your company as a limited company, this is sometimes referred to as ‘incorporating the business’. Many people may use a third party service to help them with this process but it can be completed for a much smaller fee by using Companies House directly. Depending on the type of business you set up, prices will start from around £10+. Remember that The Companies Act requires any company director to also provide their main residential address to Companies House. If you are using your home address as your business address, it is worth noting that this will be accessible by the public. Privacy is essential, you can pay an additional fee to a third party company for an address hosting service. Accountants, solicitors or agents can help you with this.

Your business premises

You will need to find a business premises to operate from, unless you decide to work from home. Most businesses will lease their office or building from a commercial landlord, only a small percentage will own their own business premises. Before signing any lease contracts, make sure you’re aware of your obligations like how often will rent be paid, contract duration, and what is covered and what isn’t. Serviced office leases may be worth pursuing if you require office space instead of a retail premises. These have more flexibility such as shorter term commitments, the chance to pay monthly and further scalability in comparison to a retail space. Furthermore, serviced leases normally have business rates included, these can sometimes be a big expense with conventional options. If you are able to work from home, you can save a lot of money but remember to include any utility bill increases as well as set up costs for computer equipment and office furniture.

Equipment, stock and tools

Stock will most likely be one of your largest expenses if you are in the retail sector. Many suppliers will often want payment within 30 days. This can help your cashflow situation during the early months of business. To make the most out of this credit period, you may wish to only purchase stock until the very last moment when it is necessary. Your stock expenses will be dependent on the type of business you operate. It is a good idea to compare different prices and suppliers before placing any orders to ensure you are getting the best deal. Ideally, you will want to have any tools and equipment that you require before you start trading, these will be covered as an upfront initial expense.

Marketing

Marketing costs can be a big expense depending on the nature of the business and how many clients you have to begin with. You need to make sure that any potential customers are well aware of the products and services you provide. Marketing costs can vary greatly depending on which method you choose. Often, many businesses do not account for enough budget allocations for marketing expenses. If you are unable to inform and attract customers, how do you expect to operate successfully.

Business insurance

As a business, you should make sure to have the right insurance in place before you begin trading. Some of the most common business insurance policies you may require are:

• Public liability insurance
• Employers’ liability insurance
• Professional indemnity insurance

For example a car garage owner who sells used cars will likely require cover for motor trade insurance. They will need public liability insurance to protect them against injury or damage compensation claims made by clients, customers or suppliers, whether at the business premises or elsewhere. Employers’ liability insurance will be required if they employ anyone permanently or on a casual basis. There are many different types of business insurance available to protect you. We recommend taking a look at our guide on business insurance for further details, it covers the legal aspects as well as in depth explanations for each type of business cover.

Business Travel

You may be expected to travel frequently to client sites and business meetings. Remember to factor in any travel expenses within your budget. You will also be able to claim against your tax bill for any eligible deductions. Public transport can sometimes be cheaper. If you are purchasing a vehicle, remember to account for insurance, road tax, breakdown cover, service costs, and fuel. If you plan to use your personal vehicle for business use, check with your current insurance provider to see if business use is covered.

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FINANCIAL TIPS FOR SINGLE MOTHERS

Being a single mother is never easy. You have to fulfil the roles of both a mother and father which is quite a demanding task that needs more than just a pocketful of cash. Setting up a house, sending your kids to school, saving up for college, providing food, clothing, dance classes, karate classes, music classes, whatever it is that pleases them, all take a good sum of money that your single paycheck might not provide for. In such situations, it is easy to panic and worries, day in and day out about how to make both ends meet so your children live the life they should. In this article we have tried to help you with this by listing out some financial tips solely for single mothers, to help you on your way.


1: ACCESS YOUR FINANCE AND EXPENSES:


Initially, you and your husband might have accessed your financial situation and chalked down your expenses and savings for your child’s future, however, once you’re on your own you have to go right back to a clean slate. A two paycheck family might have suddenly changed to a single one and hence, the first step you need to take financially is to access where you stand now. Think of how much your income is and then get realistic about things you might need to change about your lifestyle now.

2: CREATE A BUDGET:
After you’ve accessed your income and financial situation, the next step is to create a budget. This means a thorough comparison of your income and expenses. First, analyse your exact monthly income and then list down every little expense including little things like regular haircuts and doctor appointments for your kid. Finally, compare these expenses with your income and see if it tallies. If you find that it doesn’t, you might need to cut down a few more expenses or find an alternate source of income.


3: PAY OFF DEBTS:

As a single mother, it is extremely important both for your sake and your child’s that you don’t pile up any debts. In fact, try to ensure that you don’t incur any debts at all in the first place. Ifyou can’t afford it, try to avoid it. Proceed only if you think your terms are attractive and will be a very clear and real return on your investment. For instance, taking student loans for your kid to go to college can be on the list of good debts. For other minor things, ensure that you don’t have debts because the lesser you have to owe people the better chance you have of retaining your wealth and saving for a better future.

4: PROTECT YOURSELF AND YOUR FAMILY:


Protection here means to make sure that you have health insurance, life insurance, car insurance and anything else that can legally protect you in times of need when you might not have the financial support you require. Even if their dad is still around, it is important to think of what might happen to your child once you are no longer there to support them, thus take the necessary steps to keep them secure.

FINANCE TIPS FOR YOUNG ADULTS

Most of the young adults are clueless when it comes to managing your money especially when you are out there in the real world all on your own. Personal finance has yet to become a subject we learn in school so we need to take responsibility upon ourselves to tread through the water. Here are some tips for young adults so to help you be more responsible with your money.

Learn Self Control

An important life lesson to learn is the fine of delayed gratification which means not getting what you want right then and there. This is massively helpful to keep your finances in order. It might be tempting to buy something you want on credit but it is better to wait until you have saved up the money to buy it. It is a waste of time and money bothering to pay interest on something you could have otherwise just saved up and bought.

Know where the money goes

It is a good practice to know exactly where you are spending money and on what. This way you can avoid the devastating practice of spending more money than you earn. This can lead you into a spiralling cycle of debt and ruin years of your life. Also, figuring out where the money goes can help you make better choices with regards to finance and maybe even help save up a little money.

Keep an emergency fund

We have all had that point in our life when we are thrown a curveball. This can happen to anyone and at any time. Keeping an emergency fund can help you stay afloat should this happen to you. One of the most quoted mantras when it comes to personal finance is “Pay yourself first”. Having a rainy day fund can your saving grace when you find yourself in a very tight spot.

Start saving for retirement

It is never too early to start saving money. You want to give yourself the best possible life possible when you are unable to work after retirement. Saving up for retirement at a young age means that you will be able to live very comfortably when you eventually get to that point in life.

Understand taxes

Even before you receive your first paycheck you need to understand taxes and how it affects salary. This way you will be able to tell if the money that you receive after taxes will be enough to cover your immediate financial expenses with hopefully, money left over for savings.

Health Insurance

If you are uninsured and you find yourself in a serious (or minor) health problem, you can be charged thousands of dollars as medical expenses. But having health insurance means that you are not paying out of your own pocket during such an unfortunate time. Look at different providers and find the best one which in your budget. Trust me, the insurance premium payments are worth it in the long run.

You don’t need a degree to become an expert at managing one’s own finances. You just need to smart about how, when and where you spend your money and have the foresight to save money for the future when you might need it more.