Advertisement feature
Having multiple sources of income is ideal, which is why more and more people resort to part time work or freelance services, as well as other business ventures that they can do during their free time. If you are an individual who loves to work on small side projects, you may find it a challenge to ensure that you have ample finances to cover your project. One way to finance side projects is by cutting back on your day to day expenses. Try checking sites like Top Vouchers Code for easy ways to save cash.
Thus, here are some tips on how you can finance small side projects and generate revenue in the future instead of the other way around.
Create a budget plan
The first thing that you should keep in mind in terms of financing your small side project is to create a budget plan even before you start. This is because planning is essential for any business venture or freelance work. It will be best to list down the materials that you will need for your project as well as a timeline of the expected project completion. This will give you a good idea in knowing when your expenses will hit you because project expenses are not only on the upfront but there can be a maintenance costs that you need to settle in the middle of completing the project, as well as costs that will only be apparent when the project is nearing its completion. With a budget plan, you will also have an idea on the amount of contingency fund that you need to secure in order to ensure that your project will be delivered in its estimated completion date even if there are unexpected financial mishaps during the process of its completion. In parallel to this, it will also greatly help if you are able to resist the temptation to overspend early on the project and stick to your budget plan.
Require deposits
People who delve into making small side projects often fail to require their clients with a deposit before starting the project. While this can help build your relationship with the client, it can negatively impact your project in terms of the finances. This is because without a deposit, you need to secure funds to purchase the materials you need in another avenue. On the contrary, with ample deposit, you will be able to readily acquire the materials you need to get the project started on time. Apart from a deposit, you can also work with your client to come up with a payment schedule that is amenable for both of you such as paying an initial deposit, followed by 50% of the cost upon a certain project phase completion, and eventually a total and full payment of the balance upon delivery.
Be creative in cash flow management
Another tip in financing your small side project is to be creative in your cash flow management. This is especially helpful if you are using your credit card to purchase the materials you need for the project. You can work around with the billing cycle of your credit card in terms of when you will make the actual purchase and be able to end up having the need to settle your balance even months after you buy the things you need. For instance, if your billing cycle is from the 15th of the current month to the 14th of the succeeding month, your due date is usually the end of the succeeding month. Thereby, you can buy the materials you need on the 15th of the month, which is the start of your billing cycle, and pay for your purchase at the end of next month, giving you at least six weeks of padding before the due date.
Prepare your personal finances
For small side projects, there may be a need for you to prepare your personal finances for funding your venture. This means that there can be a possibility that using your savings to initially finance your project is necessary. In parallel to your personal finances, there is also the option for you to seek the help of your family and friends when it comes to having an ample budget to ensure project completion. More often than not, your family and friends will be willing to fund your project in support of your business venture, without asking for anything in return. However, you should also bear in mind that your personal finances, even when coupled with the money you borrow from your family and friends, may still be insufficient, depending on the needs of your project. Thus, there may still be a need for you to consider other financing options when it comes to funding your small side business.
Consider getting a loan
One very popular method of financing a small side project is applying for a loan. There are a wide variety of loan types that you can consider such as payday loans. Perfect Payday offers payday loans, which are considered as an instant or ‘no-credit-check’ loan, allowing you to have the funds you need the soonest. Payday loans are short-term loans that need to be settled once you are compensated by your employer or paid by your client, thus, the term payday loan. More often than not, the interest imposed by the loan is significantly outweighed by the revenue generated upon delivery of the project. Thus, it can be deemed that getting a loan to finance your small side project may actually be a smart move. However, there is a need for you to comprehensively understand your budget and cash flow before venturing out into loans and external financing. This is to ensure that you will be able to settle your dues on time and eliminate the possibility of having a bad credit, which will have a negative impact on your business.
Small side projects that you do in parallel to your main source of income usually stem from your hobbies or the things that you are most passionate about. These small side projects may include artwork pieces or even a social entrepreneurship venture, which is also referred to as a business for a cause. Keep the tips mentioned above in mind whenever you find it quite challenging to finish your task at hand because of insufficient funding.