How to increase your revenue by cutting expenses
Q: Dear Ruchi, this year I am really aiming to make my finances a top priority. I am a small business owner that dedicates all of my time and energy to keeping things stable for myself and my team. I want to find a way to make more money to help mind the current gap of stressful inflation prices. Do you have any recommendations on what I can do for a quick boost?
A: I love that your finances are a top priority and here you are taking the first step. A lot of us have faced moments like this that make us feel stressed about our finances or the well-being of our business/team. But, you certainly came to the right place!
While most times when we think about making more, the focus goes straight to revenue, which is SO important of course (we know the ones that may be on your radar: take on more clients, increase your rates, add new offerings), though I’d like to challenge you to flip the script a bit here and think about another way of bringing in more money while conserving some of your time, energy, and mental well-being.
Let’s start by looking at this from a different perspective. People often don’t think about cutting unnecessary expenses as a way of “making more”. You’d be surprised how often sneaky expenses can slowly drain your bank account. Just doing this little audit can change things quite a bit!
When reviewing your expenses, take a slow and steady deep dive into your finances or ask an advisor to help you identify some more high-touch areas where you could be saving.
Here are a few common ones I’ve seen firsthand…
Software, Subscriptions, & Memberships
While some of these may be a necessity for your business, keep an eye on those sneaky free trials, automatic renewals, and unused software that often charge you annually. If you happen to miss a cancellation deadline don’t be afraid to advocate for yourself and reach out to customer service. There are often ways to be refunded in these situations.
Insurance Deductibles
Are you over insured? Sometimes you can lower your insurance premium by reducing your deductible or making changes based on your income. I also recommend using an insurance broker rather than going straight to an insurance company so that you have an advocate who is looking out for you with the best rates.
Utilities
With utilities, you should remind yourself that you should pay only for what you use. Your phone bill is a great example of this. Are you using all of the data you pay for? If not, consider lowering your plan to cut costs.
Credit Card Interest Rates
Credit card interest rates are at an all-time high. Keep a close eye on your bills and consider setting up automatic payments or creating calendar reminders for yourself. One simple missed payment can result in owing more. Also, call your credit card company to see if they can do anything to reduce your interest rate.
Happy saving!
Here’s to your prosperity!
-Ruchi