Personal Survival Budget
“Survival was my only hope, success my only revenge.” – Patricia Cornwell
It is always important that you establish what you want from your business in regard to your personal financial reward.
As part of your initial planning for your business, you should establish what your Personal Survival Budget figure is.
Do you need to carry on with your employed work and run your start-up ‘part time’ or do you want to throw yourself into it full time and require an income from the off? Either way, (or any variation on that theme), you need to ensure that you have carried out a full assessment of what the business needs to provide you with personally, (to achieve your minimum survival budget), and calculate this into the forecasts developed within the business plan.
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You have to be confident that the business can generate this ‘Personal Survival Budget’ level of income to sustain you otherwise you will have to reconsider your options. Clearly this is not being pessimistic but realistic – running a business can be hard work and you need to be prepared for the worst case scenario.
This thinking needs to include factors such as rent / mortgage, council tax, bills, food, car running costs, insurance, etc. But also remember to factor in the costs of the business too – printing and marketing costs, premises, wages, overheads and so on.
Don’t ignore your Personal Survival Budget as you need to be confident that you can last the tough times.
Don’t ignore your Personal Survival Budget as you need to be confident that you can last the tough times. Seek advice from your business mentor, coach or accountant to help you be clear in your numbers.