Can Your Online Business Help You Save
THE CHRISTMAS CLUB SAVINGS ACCOUNT
When I was in High School, my mother set up a Christmas Club Savings Account for each of us. Every week when she was paid, she would deposit $1 in our accounts. These accounts were special accounts that would start the first week of January and you would withdraw them just before Christmas.
Every year while my mother did this, we knew we had money to shop with for Christmas presents for each other. Although the account could have been accessed any time of the year, it never occurred to any of us to use it as an emergency fund.
Over the years, Savings Accounts have diminished in numbers and amount of funds they hold. People are not saving enough and most people are living on some sort of credit (debt).
THE PURPOSE OF YOUR ONLINE BUSINESS
I’m not saying the ONLY purpose of your online business is for the purpose of saving. However, I will say this should be a priority. When you decided to start an online business, I hope you had some purposes in mind to justify spending the time and expense to getting started. If not, you will not succeed.
Can your online business help you save? If this is one of the purposes (set this as a goal) of building your online business, then you need to find a way to make this happen.
Running an online business is difficult enough without worrying where the money is going (especially to savings). The difference between being the “owner” of a business and an “employee” of a business can be refined down to level and amount of responsibility. As an employee, you are given responsibility for certain functions of the business. As an owner, all of the responsibility rests on your shoulders.
PLANNING FOR SAVINGS IN YOUR ONLINE BUSINESS
When I look into involvement in any new venture, I look into certain parameters. Part of this is pre-planning some of the finances as you begin to earn money online with your new online business.
The top priority is to be totally aware of what Tax Obligations you will incur. You will have to pay taxes on the tax rate (that applies to you) that you can find in the tax tables. (For more on this aspect, consult with a tax professional. ) I like to look at it this way. When you are engaged in business, you have business expenses. After you take this into account, the balance is what you will be taxed on.
I do not want to get into tax strategies. This is my outline.
Here is a list of expenses that I look at:
- Business Expenses
- Tax Liabilities
I did not say: “Divide your business income into these 4 components.” I take my Business Expenses out of the picture first. Then, I decide how I am going to divide the other “4” components up!
Did I say 4? Yes I did!
That 4th component is the one you are really working for. That component is the money you get to keep and PLAY WITH!