Evaluating Your Budget: Are You Spending Extraneously?

At least once a year, take the time to evaluate your spending. If you are like most businesspeople, after a thorough review of your budget, you’ll be able to identify several items that can either be eliminated or significantly reduced.

If you are having trouble achieving an objective viewpoint to evaluating your budget, here are some areas where you may be spending extraneously.

Accounting software

Do you really need to spend hundreds of dollars on accounting software for your business? A free software service such as Mint.com may serve your needs. Try it out for yourself and see. You may be able to save on the initial software purchase price, as well as expensive software updates.

Paper products

Though many of us strive for a paper-free office, there are still many instances where we find that our efficiency is improved by printing out information and reading it from a piece of paper. But often, after that paper is used only once, we throw it away.

A better solution is to draw a diagonal line across the side of paper that is used, and then create a stack of scrap paper that can be printed on the other side. You may just find that your copy paper costs go way down.


Watch your profits increase when you keep more money in your bank.

Office supplies

Do you really need highlighters in every color of the rainbow? What about pens? Everyone usually has a favorite brand, but maybe you could save certain pens for items like signatures or official documents, and use a cheaper brand for everyday use. The same goes for Post-its, notepads, file folders, and binder clips.

Try to adopt the mindset of when you were first starting out in business, and operate as if you didn’t have a spare penny to spend. Don’t use Post-its to write notes. Instead, use scrap paper cut into notepad size and stapled together at the top. Reuse file folders instead of throwing them away. Use white file folder labels to designate the new file name.

Presentation supplies

Do you really need to spring for full-color business cards? Raised lettering is impressive, but since most people don’t retain business cards, the impression is going to be short-lived. It’s better to invest once in a killer logo that you can utilize repeatedly in your presentation package than to spend money on something that is going to end up in the recycling bin.


Your business card doesn’t have to be made of gold in order to get accepted.

Entertainment

Even though business meals are tax-deductible, you still have to pay for them. Don’t think you have to break the bank at expensive restaurants to gain clients. Your extravagance may backfire if clients get the idea you are free and easy with your wallet.

Don’t fall prey to the dated belief that throwing money at a problem is a viable solution. A wise businessperson identifies where costs can be cut without affecting the bottom line. Reducing your budget expenses will not only afford you a bigger growth potential, but will demonstrate your fiscal responsibility to any future lenders you may need to answer to.

Kate Supino is a professional freelance writer and small business owner who writes extensively about best business practices and budget help advice.

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