One of the most exciting parts of becoming an adult is moving out of your old place and starting your own life. However, as is the case with most major life events, moving out comes with a lot of added responsibility. Part of this duty is knowing and understanding your budget when shopping for the perfect apartment, condo, duplex, or rental house. So how much should you really spend on rent?
The 30 Percent Threshold
The first step in deciding how much you should spend on rent is calculating how much rent you can afford. This is done by finding your fixed income-to-rent ratio. Simply put, this is the percentage of your income that is budgeted towards rent.
As a general rule of thumb, allocating 30 percent of your net income towards rent is a good place to start. Government studies consider people who spend more than 30 percent on living expenses to be “cost-burdened,” and those who spend 50 percent or more to be “severely cost-burdened.”
When calculating your income-to-rent ratio, keep in mind that you should be using your total household income. If you live with a roommate or partner, be sure to factor in their income as well to ensure you’re finding a rent range that’s appropriate for your income level.
If you’re still unsure as to how much rent you can afford, consider an affordability calculator. Remember to consult a financial advisor before entering into a lease if you’re unsure if you’ll be able to make rent.
Consider the 50/30/20 Rule
After you’ve set a fixed income-to-rent ratio, consider the 50/20/30 rule to round out your budget. This rule suggests that 50 percent of your income goes to essentials, 20 percent goes to savings, and the remaining 30 percent goes to non-essential, personal expenses. In this case, rent falls under “essentials.” Also included in this category are any expenses that are absolutely necessary, such as utilities, food, and transportation.
Let’s consider a hypothetical situation in which you make $4,000 per month. Under the 50/20/30 rule with a fixed income-to-rent ratio of 30 percent, you have $2,000 (50 percent) per month to spend on essential living expenses. $1,200 (30 percent) goes to rent, leaving you with $800 per month for other necessary expenses such as utilities and food.
Remember to Budget for Additional Expenses
Now that you’ve budgeted for rent and essential utilities, it’s time to make a plan for how you’re going to furnish your apartment. One of the biggest shocks of moving out on your own is how expensive filling a home can be. From kitchen utensils to lightbulbs and everything in between, it can be pricey to make your space perfect.
For the most part, furniture falls under the 30 percent of personal, non-essential expenses. Consider planning ahead before a move and saving for home goods so that you don’t go into major debt when it comes time to move out.
Be on the Lookout for Savings
If your budget is slightly out of reach for your dream apartment, try to nix unnecessary costs to see if you can make it work. Look for ways to cut down on utilities, insurance, groceries, and rent.
Utilities: Water, heat, and electricity are all necessities, but your TV service isn’t. Cut the cord on TV and mobile services that may not serve you and your budget anymore. Consider swapping out your light bulbs for eco-friendly and energy-efficient light bulbs to cut down your electric bill.
Insurance: Instead of paying monthly renters insurance rates, save a fraction of the cost by paying your yearly cost in full. If you have a roommate, ask to share a policy together at a premium rate.
Groceries: Swap your nights out for a homemade meal. You can save up to $832 a year with this simple habit change. When grocery shopping, add up costs as you shop to ensure your budget stays on track.
Rent: One of the best ways to save on rent is to split the bill. Consider getting roommates to save 50 percent or more on your monthly rent.
A lease is not something to be entered into lightly. Biting off more rent than you can chew can lead to unpaid rent, which can damage your credit score and make it harder to find an apartment or buy a home in the future. By implementing these best practices, you’ll hopefully find a balance between finding a place you love and still having room in your budget for a little bit of fun.
Sources: US Census Bureau
The post How Much Should You Spend on Rent? appeared first on MintLife Blog.
Original Source: blog.mint.com
If you dream of clocking out of your nine-to-five job for the last time and becoming your own boss, you’ve probably considered a variety of small business ideas. But, while you have plenty of passion, direction can be hard to find.
To help, I’ve pulled together small business ideas for anyone who wants to run their own business. Use these as a jumping off point to spark your own unique ideas:
Small Business Ideas
Home Business Ideas
And if all else fails, live the words of Airbnb Co-founder Brian Chesky: “If we tried to think of a good idea, we wouldn’t have been able to think of a good idea. You just have to find the solution for a problem in your own life.”
Ready to take things to the next level? This ultimate guide to entrepreneurship can help you do more than dream up a good idea. It can help you turn it into reality today.
Best Small Business Ideas
Are you always fixing things around the house? Often on call when friends need small projects completed? Put together a website, figure out what your time and expertise is worth, and start asking those thankful friends for referrals.
Similarly, if you have a passion for crafting beautiful furniture or other home goods out of wood — there’s demand for that. List a few of your pieces on sites like Etsy, eBay, or Craigslist. Once you build a following, consider starting a website, accepting custom orders, or expanding to refinishing work and upholstery.
3. Online dating consultant
Dating consultants usually charge for their time. They help people create successful online dating profiles, source possible matches from outside normal online channels, and offer a level of personalization Tinder just can’t. Think you’ve got a knack for the match? This might be the business for you.
4. Sewing and alteration specialist
People will always need clothing hemmed and buttons mended — and you could be the person to do it. If you love sewing, start by offering simple services like those mentioned above, and expand your repertoire to dressmaking and design as you build a customer base and demand.
5. Freelance developer
From building websites for other small businesses to providing technical support for certain projects, quality web development is in high demand right now. With such a technical skillset, make sure you can describe what you do and how you will do it in easy-to-understand language. Test your messaging on friends and family who don’t have a firm understanding of the work you do.
6. Personal trainer
Offer in-home consultations, personalized nutrition and exercise regimens, and community boot camps to get the word out. Don’t forget to populate an Instagram feed with inspirational quotes, free exercise videos, and yummy snack ideas as well — it’s a common way for fitness gurus to build their brands.
7. Freelance graphic designer
Set your own hours, choose your projects, and build a portfolio and business you’re proud of. From website design to blog graphics and more, many companies seek out experienced graphic designers for all manner of projects.
8. Life/career coach
If you have some experience under your belt, put it to good use as a life or career coach. Many of us are looking for guidance in our careers — and finding someone with the time to mentor us can be tough. Life/career coaches don’t come cheap, but they are able to offer clients the intense and hands-on training and advice they need to make serious moves in their personal and professional lives. After all, sometimes everyone just needs some uplifting advice.
9. Resume writer
Submitting a resume, cover letter, and — when necessary — portfolio for a new job can be tough and time consuming. That’s why many people hire help. Assist clients with tailored resumes, beautifully edited cover letters, and carefully crafted portfolios that make it impossible for employers to ignore.
10. Freelance writer
If you have writing skills, there’s someone out there willing to pay you for them. Write blog posts, magazine articles, and website copy galore — just make sure you have a body of work built up to share with potential clients. Even if you create a few sample pieces to have on hand, they’ll help exhibit your work and attract new business.
Speak a foreign language? Start a translation service. Consider specializing in a specific genre of translation, like medical or financial translation, as you might be able to fill a niche need in your community.
12. Garden designer
Many people have the willingness to do the dirty work in their backyards, but few have the know-how to design a backyard space to begin with. Draw up the designs for your clients’ outdoor spaces and let them do the actual digging.
13. Ecommerce store owner
Do you create, collect, or curate anything special? Consider starting an ecommerce store and turning your hobby into a full-time job. Whether you need somewhere to sell all that pottery you’ve been making, or an excuse to search for the sports memorabilia you love tracking down — an ecommerce store can make it financially viable for you to pursue your passion.
Mowing, tree-trimming, and seasonal decor are all neighborhood needs. If you have or can acquire the equipment, a landscaping business can be a lucrative affair.
Video production requires you to have invested in the equipment up front which can be quite expensive. But that’s also what makes your services so valuable. Make sure you have a reel of your work to share or create a website with several selections of your work available for interested viewers.
Start by conducting photo shoots for your family and friends. As you build a body of work, ask for referrals. Photography businesses often grow by word of mouth, so create a Facebook page where you can tag recent clients, which will show up in their friends’ newsfeeds as well.
17. Travel planner
The time of the travel agent might be passing, but people are still looking for those with a knack for more nontraditional travel coordination. If you always plan the perfect vacations complete with beautiful hotels, the ideal location, and a bevy of delicious restaurants lined up for every evening, consider advertising your services as a more modern approach to travel planning.
18. Car-detailing specialist
The devil is in the details and you can be too. Car detailing services that travel to the client are in high demand. Just make sure you have the flexibility, transportation, and equipment to take your business on the road.
19. Home inspector
This will require a great deal of expertise and certification, but it’s a job that can give you the flexibility and pay you’ve always dreamed of. Confirm the licensing requirements in your state and consider taking a few courses to build out your knowledge, authority, and expertise.
20. House cleaner
With a low barrier to entry, house cleaning can be a great way to start doing what you love — soon. Consider advertising to homes in your neighborhood and get more bang for your buck by earning a few small businesses as clients as well. They’ll usually bring in a higher paycheck for a similar amount of work.
21. Personal chef
We all love to eat, but few of us have the time or energy to cook healthy, delicious meals. Advertise your services to local families and businesses alike. And consider “chunking” certain groups of clients — say, vegetarians — so you can cook larger quantities of the same dish to feed them all.
22. Property manager
Many people maintain properties they don’t live in — often based in different cities or states. It’s helpful to have someone to ensure the property is being well taken care of, handle small fixes as they arise, and serve as a liaison to renters.
23. Packing services facilitator
Moving is always a pain, and many people hire the entire packing process out. Want to have a steady stream of clients? Partner with a local moving service who will refer new clients to you.
24. Massage therapist
Soothe aching muscles and promote peace for your clients as a massage therapist. Look into training and certification courses in your city and state and invest in a portable bed to take on client visits.
25. Hairdressing or makeup artist
Sure, you could go to cosmetology school and pay for an expensive chair at a salon, or you could offer specialized styling and makeup services right to your client’s door.
26. Bed and breakfast owner
This is another business venture that will require you to research the correct licensure from your state, but it will be well worth it to see your dreams come true. Consider what guests will be traveling to your area to experience and create special packages and themed stays to coincide with their interests in your locale.
27. Interior designer
Similar to landscape design — there are many people who have the ability to buy the furniture and home decor they need to fill their rooms, but few who know where to start. It might take some time to build a portfolio but documenting your projects and sharing them online can build a fan base beyond your wildest dreams.
28. Nonprofit owner
If you dream of devoting your life to a cause you believe in, it might be time to start a nonprofit. You’ll need to incorporate your business and file for 501(c)(3) tax-exempt status — and then you’ll be required to meet ongoing standards of compliance, but the payoff is making a meaningful impact on a cause you believe in. Want to do good while still making a profit? Consider social entrepreneurship.
29. Tour guide
Love the local history of your city or state? Consider becoming a tour guide. Sure, you’ll need to conduct tons of research to be able to do the job well, but that’s half the fun. Set yourself apart by offering tours that speak to a specific niche of your community’s history. Some tour guides offer historical walking tours of their town’s most haunted spots while others curate guided foodie tours for guests to get a true taste of the city.
Whether math whiz, piano master, or Shakespeare aficionado — there’s someone out there who needs a little help and is willing to pay for it. Advertise your services through local schools, community colleges, and community centers to get the word out and build a customer base.
If you have significant experience in or knowledge of a specific subject, consider becoming a consultant. Perhaps you’re an expert at hiring practices, have a knack for SEO, or have led multiple sales teams to six-figure success. If you’re good at it, market yourself as a consultant and charge the going rate.
32. Clothing boutique owner
If you dream of building your own fashion empire, why not start with a local boutique? Build buzz with impressive window displays, inspiring social media accounts, and heavy community involvement.
33. Event planner
You might choose to specialize in a specific type of event — like weddings or company meetings — or set yourself up as an event planner of all trades. If you’re highly organized, pay keen attention to minute details, and have experience planning large events, it might be time others benefit from your skills.
34. Specialty food store owner
Gourmet foods, cheeses, sake, wine — you name a food, there’s a specialty food store out there for it. Put your passion for exotic olive oils to good use and open a store where you offer the kind of expertise and selection your audience couldn’t dream of getting from their local grocer.
35. Personal assistant
Again, if you’re an organized, highly detailed person, the life of a personal assistant might be for you. Don’t want to be tied to one office or person all day, every day? Consider becoming a virtual assistant, which allows you a more flexible work environment.
36. Food truck owner
Always dreamt of owning a restaurant but not quite ready to take the plunge? Test out your concepts with a food truck. It’s a great way to become familiar with food and restaurant licensing in your state, see what people like and don’t like, and build a ravenous following before ever opening or investing in a brick-and-mortar location.
37. Consignment shop owner
If you have an eye for style but don’t want to invest in the inventory of a brand-new boutique, consider going consignment. It will allow you to curate a collection of clothing that matches your goals and aesthetic, without the overhead of a boutique selling entirely new garments.
If that personal chef gig is too restrictive for your schedule, consider catering instead. Pick your projects, work fewer but larger events, and get really good at time management.
39. Gym owner
Kickboxing gyms, yoga studios, CrossFit, oh my! Turn your passion for fitness into a community for others by opening your own gym.
40. Daycare owner
Childcare continues to be in high demand. While nannies and nanny shares are popular right now, a good daycare is hard to find. Fill a need in your neighborhood by opening your own. And, as always, make sure you’re complying with your city and state’s zoning, licensure, insurance, and inspection requirements.
41. Boutique agency owner
What’s your specialty? Whether it’s marketing, social media, or PR, it might be time to start your own agency. Many other small businesses need this type of help, but don’t have the resources or volume to necessitate a full-time position. Consider a building a small team and learn from other entrepreneurs who’ve successfully started their own agencies, like Duane Brown of Take Some Risk.
42. Coffee shop owner
Turn your caffeine addiction into something a little more lucrative. Opening a franchise or buying an existing shop are lower-risk entry points to the coffee game but they usually require a little more cash up front. Starting a shop from scratch requires a little more planning and a lot more work — but it also maximizes your earning potential in the future.
43. Moving company
A truck, moving equipment, manpower, and the correct permits and insurance are the building blocks of starting your own moving company. Before you buy your first fleet of trucks, however, start small with a moving van and keep your costs low. Still sound like too much of an initial investment? Consider offering packing services only, which have a much lower financial barrier to entry.
44. Home staging
If you have a flare for interior design, a staging service might serve as your creative outlet and professional calling. You can build a portfolio with little initial investment by staging homes using the owner’s existing furnishings and decor. Most stagers eventually build up inventory of furniture as they become more established and network with area realtors.
45. Dog walker, groomer, or trainer
Licensing and insurance will be the two most important factors in opening a dog walking, grooming, or training business, but your canine colleagues will surely make up for the initial red tape. To test the waters before jumping in, consider walking dogs through companies like Rover or Wag. Ready to run your own show? Consider a franchise like Dogtopia.
Home Business Ideas
These home business ideas give you a few more business options that are either based at home or online.
In the world of freelance, you can work from home and be your own boss. Use your skills to earn business in your desired field:
2. Social media manager
Do you have a knack for social media? As a social media manager, you can use your skills to manage the social media accounts for companies and even individual people. Influencer marketing has become more common and many influencersrely on marketing agencies or employees to help them run their social channels.
3. Data entry clerk
Many businesses seek data entry clerks to help them enter information into their computer systems and spreadsheets. If you have fantastic computer and typing skills, this might be the business for you.
4. Pet sitter
Do you have a passion for pets? Consider becoming a pet sitter. While the pet’s owners are away on vacation, either host their pet at your home or make visits to their home. Join a pet sitting service like Rover or Care.com to get started.
5. Vacation host
Have you ever used a home sharing service instead of a hotel? You could make a living by hosting visitors in your own home or renting out a room. Consider becoming a host with companies like Airbnb, Vrbo, or Homestay.
1. Identify your small business idea.
Whether you choose an option from the list above or have another idea up your sleeve, it’s important to have the experience, training, or skills necessary to be successful. Want to run a daycare but have never even visited a successful daycare center? Spend time conducting research to learn whether this is really the right fit for your experience and interests.
2. Start as a side business or hobby.
Can you get your business off the ground as an evenings or weekends side job? This allows you to make some mistakes, test the market, and understand whether your idea has legs before you quit your nine-to-five job and lose your primary income.
3. Create a business plan.
Once you know your idea has the potential to succeed, it’s time to build a business plan. Not sure where to start? Try this business plan template.
Your business plan should include the following elements:
Executive summary — A high-level overview of your company and market placement.
Business model — Outline what your business does, who your business serves, and how your business is structured. You should include a description of what products and services you offer, and how they meet the needs of your customers.
Market condition — A summary of pertinent competitor information. Determine the strengths and weaknesses of your closest competitors.
Products and services — Use this section to describe your products and services in detail, and outline what differentiates your product from others in the market.
Operations and management — Outline your business’ organization structure, key roles, and responsibilities.
Marketing and sales strategy — This section should describe how you will market and sell your product. Include information on your ideal customer, how you plan to position your offering, and your sales strategy.
Financial plan — Create a detailed outline of your business financials. Include your start-up costs, your initial financial productions, and how you anticipate generating funding.
Appendix — Once the above pieces are complete, end the document with an appendix summarizing your business plan.
Business plans should identify what makes your offering different from competitors. They should also be short and actionable. And your business plan should evolve with your business.
4. Decide whether you’ll be an LLC or sole proprietorship.
Two common legal structures for small businesses are limited liability corporations (LLCs) and sole proprietorships.
An LLC is a more complex business structure than a sole proprietorship, and can include individuals, corporations, and other LLCs as members. Additionally, LLCs are not subject to a separate level of tax and offer the business owner liability protection and tax advantages. LLCs are formed on a state-by-state basis.
Sole proprietorships are businesses owned and operated by one person, and are not identified as a separate entity from the owner by the government. While a sole proprietorship is the simplest business structure, sole proprietors are personally liable for their business.
Learn more about choosing the right structure for your business from the Small Business Administration.
5. Create a business bank account.
Once you have a legally formed business and have been issued an Employer Identification Number (EIN), open a bank account specifically for your business. Having a business bank account is essential for keeping your personal and business finances separate which can help you gain an accurate picture of your business’ cash flow and financial health. Additionally, keeping your personal and business finances separate makes bookkeeping and tax preparation easier.
Many banks offer business checking and savings accounts. Business checking accounts typically do not have a limit on the number of transactions that can take place, and issue a debit card that can be used for making business purchases. However, these checking accounts do not accrue interests.
Business savings accounts typically earn interest over time, but have a limited number of transactions that can occur each month. When you’re just starting out, look for a business bank account that does not have a minimum balance requirement so you are not penalized for having low funds as you work to build your business.
6. Decide on your software.
You’ve got a lot of things on your plate when first starting up. But one step that’s critical (and often forgotten by first-time entrepreneurs) is deciding on the software that can help you be more efficient as your business grows.Every business is different — but almost all companies can use software to help with analytics, project management, accounting, bookkeeping, email marketing, and other basic day-to-day tasks. One of the most important software tools every business should utilize is a free CRM to keep track of important customer information in one central database. It will help align your team and make sure you stay organized as your business grows.
7. Determine if your business idea works well from home.
Ask yourself whether your business idea will work well from home. Some businesses simply aren’t suited to being based from home. If you want to run a dog boarding center but live in an apartment without a backyard, you might want to consider a dog walking business instead.
8. Set up an office.
If your business idea is well-suited for being run from home, it’s still important you have a designated work space. While a home office might not be possible, consider setting aside a corner in your living room or putting a desk in your bedroom for a space that inspires you and creates the conditions for success.
Need a more professional space? If you conduct client-facing work requiring you to be on video calls, no one wants to see your rumpled sheets in the background. Check out local coworking spaces for memberships that earn you access to conference rooms, desk space, and more.
9. Get to work!
You’ve put in the hard work and I’ve got good news … it’s only going to get harder. But most entrepreneurs will agree the payoff of being your own boss, making your own hours, and working on projects you’re passionate about will pay dividends for the rest of your life.
Selecting a small business idea is a personal decision. But it can be helpful to bounce ideas off your friends and family. Don’t be afraid to ask for help throughout this process — and remember to have a little fun while you’re putting in the work.
Ready to begin building your small business today? Check out our complete guide for how to start a business. Or brush up on your reading with this high-impact list of books about starting a business you can’t afford not to read.
Original Source: blog.hubspot.com
When you launch your own business, you’ll quickly learn how important it is to protect yourself, your assets, and your future. Not just from the standpoint of your business and customers, but also how your personal life, finances and family might be affected by your decisions down the road. For example, you might need to …
Continue reading “What Entrepreneurs Should Consider When Buying Life Insurance”
The post What Entrepreneurs Should Consider When Buying Life Insurance appeared first on Zac Johnson.
Original Source: affpo.st