I love learning what people spend their business profits on, and today I’m sharing what I do with the extra income I earn! This is a topic from the post, 27 Blog Topics You Can’t Wait to Write About (& Your Readers Can’t Wait to Read). I’ve been posting all 27 myself, and How I Spend My Business Profits is #13.
I’ve been in business for five years now, and how I spent my earnings in the early days (when they were much less reliable) is different than what I do with my income now. I’ve been a stay-at-home Mom for years, and my husband and I have always tried to budget on his income only. Even after I started turning a profit, we only used my earnings as bonus or investment funds.
As my income has grown and become more reliable, things have changed. By year three (2013), using my profits as “fun money” started to feel more like burning cash. At the start of year four (2014), we were so used to blowing through the money that we really had no idea how much I was contributing. I decided to better budget the earnings, shared my income reports and monitored the money more closely.
If I’d come across this question even a year ago, I would’ve given a much different answer (and it would have been more of a guess). I spent my business earnings on clothing, extra spending, eating out, trips and travel, etc. It was pretty frivolous, and if I had to do it over again, I would have made a budget like the one I follow now in year three. Why year three and not earlier?
There’s typically no rhythm or reliability to creative business before the third year. I was still buying supplies I didn’t need, flying by the seat of my pants, buying ad campaigns with little preparation and learning the profitable seasons of both my Etsy shop and blog. By year three I noticed the rhythm and found some reliability, but it was more fun to buy Michael Kors than budget. 🙂
Today I work off of a fairly strict budget, and I have enough of a rhythm that I know what I can expect from my business each month. However, I low-ball my budgeted income so I won’t stress over a bad month. I usually make more than what I’ve budgeted, and I try to have a running plan for what to do with the extra income I produce (so that we don’t burn through it – so easy to do!).
Each month I …
- make the payment for my new and beautiful car (it’s a minivan, but if you asked me, it’s the most luxurious car on the planet),
- help to pay off consumer debt,
- contribute toward our family’s expenses,
- pay my children’s allowance,
- and buy two weeks’ worth groceries!
I LOVE that list! I love sharing how the work I do here with you, or the orders I fill at the Energy Shop, adds to our family’s life everyday. I feel blessed and grateful to do this job!
That’s how I spend my profits – how about you?
Please share! Oh, please do! I love learning what people spend their money on (and your readers will, too)! Forever grateful,