How to Stop Throwing Money Down the Drain
Summary: Throwing money down the drain is something business owners do not do intentionally. Usually, this is an accumulation of bad choices or lack of planning. In this article are simple ways to stop throwing money down the drain.
How to Stop Throwing Money Down the Drain
Knowing how to stop throwing money down the drain is probably one of the things small business owners or any individual wished they knew before diving into a business or adulthood.
Learning that your hard-earned money goes down the drain is difficult to fathom for business owners.
What brings your money down the drain?
Experts believe that throwing money down the drain is caused by several factors. In an article for Ending Small Business Failure, Melinda Emerson shared that unrecorded expenses are one of the main factors that bring your money down the drain.
Emerson considers unrecorded expenses as profit fire hazards. She said in her article, “If you don’t record the expense, you can’t ensure you bill the client for it.” One of the analogies she gave in the article was buying something for an employer with your own money. When an employee does this, they will always reimburse their employer. So the same thing should apply to a business owner.
For entrepreneur Andrew Griffiths, some reasons for having your money down the drain include:
- Not charging enough
- Cash flow issues
- Not generating enough business
How to Stop Throwing Money Down the Drain?
Based on the causes of throwing money down the drain, experts believe that there are simple ways that business owners or even anyone can follow. Griffiths even says that there are steps that you can consider simple ways to incorporate into your daily routine.
Here are some of the ways:
Rethink buying habits
In an article published by Made in A Pinch, the authors said that some of the things that cause overspending are expenses you can avoid.
In one of the steps, they enumerated in the article, checking regular transactions is one of them. These transactions include monthly subscriptions and even deals for home and car insurance.
Also, other things that accumulate over time are stuff like coffee, bottled water, manicures, car wash, and even dining out often. Although these buys do not seem to be much whenever you purchase them, the accumulated amount of them is something that might lead you to think otherwise.
Experts believe that by being more meticulous in choosing the transactions and deals that one will have, you can already save tons of money.
Pay your dues on time.
Sometimes, some dues come and go unnoticed – it’s either because of your busy schedule that you forget to pay these dues or because of lack of sufficient funds. Whatever the reason is, one should consider that those dues that incur interest overtime should be prioritized. This way, you can assure that you can save some money and maintain good standing. Thus, this one is one great way to stop throwing money down the drain.
When you learn how to prioritize paying your dues or rethink your purchasing habits, you also save money. Through these steps, you also learn how to appreciate the value of saving up. When you do so, you avoid having your money down the drain.
This saved-up money can eventually be invested in other worthy businesses or assets.
Keep track of your expenses.
Experts have long been educating business owners on keeping track of expenses. However, because it is considered a daunting task by some, it is one of those things taken for granted.
Griffiths and Emerson both said that keeping track of expenses can be detrimental in knowing the actual profit or expense in a business. No matter how big or how small the money used for a business is, it should be accounted for.
According to Emerson, every business owner should find time to account for their expenses. She emphasized that no entrepreneur is not busy. However, she also said that there are easy ways that business owners can use to track their expenses.
Learn how to negotiate
One of the best ways is to negotiate for businesses or individuals who want to ensure that they will not have their money down the drain. According to Griffiths, although we are usually conservative about negotiating, there are wonders in doing so. Negotiating can sometimes lead to better deals or even discounts. These things can exist but are not known to many just because we refuse to negotiate.
So, to avoid having your money down the drain, make sure that the next time you find an opportunity to negotiate, you will not hesitate to grab that opportunity.
Check the price regularly.
This way to stop throwing money down is somewhat associated with the first way we have shared. However, this reminder is particular with the case of purchasing items that can increase in price. Sometimes, if we are so used to buying a specific item, we tend to forget to check the price, or in some cases, we get shocked by the actual amount of an item.
Also, knowing the price of the items you are purchasing can help you assess whether the item you are buying is still worthy of its price or if it is already leading you to throw money down the drain.
Do not let go of opportunities to earn
No matter how big or small the money you can earn, these are still earnings, so do not hesitate to accept an opportunity to make if there is one. Sometimes, you tend to see small tasks as a waste of time because you start to earn bigger from more extensive projects. However, these small earnings can help you save more. Next time you can get both the small and significant gains, choose both.
Acknowledge that there is a risk of having your money down the drain
In business (or even in life,) there is always a risk of having your money down the drain. Whether it will happen or not, no one can assure. However, being cautious and acknowledging the risk of having your money down the drain should always be done so that you can avoid doing so or prevent the possibility of experiencing this.
When ending up with money down the drain
If in case these steps seem to be a little late for your situation and you feel that you already have your money down the drain, there are other ways that you can still do to recover:
Invest whatever is left
Find a trusted company that will allow you to invest your money and earn as much as your investments can. By diversifying your portfolio through Peer-to-Peer platforms like Blend.ph, you can do so. You can earn as much as 30% per annum with minimized risks.
Get better loan offers.
If worse comes to worst and having money down the drain leads you to debts, you can always have the option to borrow money. But always keep in mind that you should choose a responsible company like Blend.ph that offers loans with more flexible terms and lower interest rates.
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