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Planning for the New Financial Year

Planning for the New Financial Year starts now

 – Let’s talk about Budgets, a plan!

Single person budgets, Household budgets, Company budgets.

I like to call it a plan. In my 20’s I worked for a company where I had to travel to do budgets, a plan for the New Financial Year. We worked on those budgets for weeks, seeing where we could cut back, where we needed to increase. We a looked at the previous financial year in comparison. We adjusted for future expenses and future purchases. We looked at what made up our sales, and where we planned to increase them. Would we have the budget to open a new store?

Do you have a budget? A Plan?

I have a budget in my personal and business capacity, I used to have a rough budget and everything else was in my head. (That was when I was single and employed). Best advice is to write it down and best to have a budget as an individual, a family, a company. It never too young to start a budget.

Now that I am a Single Mom with a growing business and everything going up. Double electricity, no free water, a drought charge being in place. ADT charging a radio charge once a year. The Gym charging a maintenance charge once a year, my daughter needs to go to High School soon. (Let me not tell you how expensive that is going to be) and my house needing repair and maintenance. I have a Plan which I look at daily, weekly, monthly. I am always seeing where I can cut back, and where I can buy that thing I need or want. Where I can cut back to cover for those unexpected expenses. Can I afford to go to the Accountants conference at the end of the year in Johannesburg? Can I afford that new computer or can I afford that overseas holiday?

So I did my research, looking for more information to help myself and help others. I love researching and I started a plan.

Referring to Mike Michalowicz’s book “Profit first” I looked at my Income and Expense report – do you have one? I put in place, what is profitable, what I can reduce and what I must cancel system.

I looked at what made up my Income. I am in the service industry so I have different streams of Income at different times of the year. I looked at what I expected to make this year. At was I getting rid of. I looked at things that don’t work. At introducing new services. I also looked at the Seasons and how I could increase my income in the quiet season. (December/January is my quiet season) When is yours?

I looked at my Income and Expenses for the previous year. If you are a company have a look at your financials (management accounts) for the previous year. I looked at all the expenses that increase once a year, e.g. Insurance, security, rent (if you are renting). Even bank charges and make the allowance on the budget. I looked at once a year expenses, e.g. Motor Vehicle Licences, TV Licences, school stationery. Add them to your budget.

Now, for the best part, I put a saving plan in place. Do you have one? Referring to Mike Michalowiz’s book “Profit First’’, his Target Allocation Percentages (TAPS). (I love the book). I have a saving plan where I put away 5% for profit (R5 for every R100). 15% for Tax (R15 for every R100) and out of my owner’s compensation (salary) I decided to put away 10%. Each person’s Income is different. Their expenses are different and their debt is different. So his advice is to start small. 1% for Profit, 1% for Tax etc and increase it monthly until you reach the required percentage. It has been so exciting to watch my money grow.


In conclusion, Income Plan + Expense Plan + Saving Plan = Budget.

Need help with creating your budget. It doesn’t matter how small or big, need to know where you are going with your business. Contact me, I can help you create a plan, a budget.

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