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Consistent Income

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September 29, 2017

Whether you’re a new entrepreneur or launching your second venture, it’s no picnic making a consistent income — the type that pays your bills and you, every month.

But, before you go melting into a pile of stress, agony, and Red Bull, give yourself some credit. After all, one survey shows 37 percent of wannabe entrepreneurs feared an irregular income.

You, on the other hand, looked that fear in the face and said, “Not today!”

So, open up your Quickbooks or call your bookkeeper. The first step to earning a consistent income when your work is, well, inconsistent is to have a solid, smart financial plan in place.
If you’re having trouble paying yourself a salary or need a few tips on preparing for the off-season, read on.

Define a salary you can (always) afford

To have a consistent income, your boss needs to pay you consistently. Hint: That boss is you.

Yes, it’s tempting to make major spending decisions–like a hiring a business coach–or pay yourself more during the good months. But, what happens when the slow season hits and your car breaks down?

Project what you’ll make this year. Divide that number by 12 and deduct your 30-day expenses (including quarterly taxes, emergency funds, savings, etc.). Stick to the necessities and keep your discretionary income to a minimum.

The amount left will be your monthly salary.

Create a passive income

Some entrepreneurs start out offering their core services. If you’re a wedding photographer, you might stick to engagement sessions, day-of-event, and a few extras like trash the dress.

But, what about the months when weddings aren’t every weekend? Creating a passive income can create a steady stream of cash.

For instance, you could create a digital product, like an online course for budding photographers or a cheat-sheet guide for brides. You could also explore affiliate marketing. Try to expand on what you offer so you aren’t limited to the high seasons. Need more ideas? Here are other types of passive income.

Set aside a day each month for bookkeeping

Schedule a time each month — or better yet, each week — to review your bookkeeping, record expenses/income, and categorize your transactions.

If you wait too long to check in on your finances, you could get hit with unexpected (or unplanned) expenses. Keeping an eye on your books will give you a consistent and clear picture of your finances. For more guidance on checking in on your accounts, grab our financial goals checklist here.

We know this is just the tip of the iceberg when it comes to creating a consistent income in your business. It’ll take time, dedication, and perseverance on your part to market your business and keep clients coming back for more. But the steps in this post will help you build a foundation and set up a strong strategy.

Still not sure how much you should pay yourself? Comment below with your questions!

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