Tuesday February 27 2018

How to become a smart entrepreneur

An entrepreneur waits for customers recently.

An entrepreneur waits for customers recently. Running a business requires one to make informed and smart decisions. PHOTO BY ABUBAKER LUBOWA 

By Annet Katusiime

Understanding personal finance may seem like it only matters to your own financial security, but that’s not true. Personal financial management means going beyond spending less and earning more.
In fact, it helps you develop skills in personal budgeting and personal financial planning. Practicing good personal finance habits can positively affect your entrepreneurial practices.

Develop a vision
A vision is knowing who you are, where you are going and what will guide your journey.
Knowing the reason why you have decided to start up a business or get a job in that specific organisation and for how long it will help you to have the guidelines for daily behavior and decision making.
When I left campus my plan was to get a job work for three years, get the necessary experience and use it in my personal projects.

But after three years, life became comfortable, I was scared to live and I found myself in the same company for more than seven years. When I left, I saw many doors that I had closed because I had diverted from my vision, which had opened.
In your business, what do you envision in the next 10 years? Will the purpose of your existence be for customers or personal gains? A vision is important both at personal and entity level and if you do not have it, am challenging you to develop one.

Develop business mindset
If you are responsible with your personal income, there is a likelihood of bringing that responsible mindset into your business.
Running a business is about making smart spending and earning decisions. If you can manage your own finances you can definitely get into the mindset of a smart entrepreneur thus be able to apply the basic financial traits into your business.

Prepare for hard times:
Everyone has to be ready when things don’t go as planned. There will be days, months, or even years where your business will experience a slump or you will lose that job. Your personal finance skills can come in handy when this time comes.
If you know how to save up, your business is more likely to have a financial cushion, especially if say you have been saving up for retirement, most likely you may also apply this to your business.

Keep debt in check
The common debt in personal financial management is debt for consumption and yet debt should be able to improve your livelihood; if one can differentiate between the two, the same will apply to business.
This experience translates to your business in more ways than you can imagine. It’s so easy to overspend in your business if you don’t have the discipline or experience in dealing with debt and keeping it in check.

Don’t hesitate to lower your expectations and opt for less expensive options while refraining from unnecessary purchase.
Set financial goals
In business, you always set your financial goal for the month, the quarter, and the year. Those who also apply this to personal finances will be well equipped to make realistic goals in their business. Where do you want to be in a month, a quarter, a year, maybe even five years? Is it a financial goal to eliminate all debt?

Do you have a financial goal to fund an investment such as buying a house? Whatever your financial goal may be, write it down, plan it out, and make it happen. Practice this in your personal finances, and you will see how it translates naturally to your business.

Practice good personal finance habits today to get an early start at making your entrepreneurial dreams come true.
Ms Annet Katusiime is a certified trainer in financial literacy.

SUCCESS TIPS
Everyone has to be ready when things don’t go as planned. There will be days, months, or even years where your business will experience a slump or you will lose that job. Your personal finance skills can come in handy when this time comes. If you know how to save up, your business is more likely to have a financial cushion, especially if say you have been saving up for retirement most likely you may also apply this to your business.

In business, you always set your financial goal for the month, the quarter, and the year. Those who also apply this to personal finances will be well equipped to make realistic goals in their business. Where do you want to be in a month, a quarter, a year, maybe even five years? Is it a financial goal to eliminate all debt?

Do you have a financial goal to fund an investment such as buying a house? Whatever your financial goal may be, write it down, plan it out, and make it happen. Practice this in your personal finances, and you will see how it translates naturally to your business.

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