4 Smart Tips for Spending Money Wisely as a Business Owner

The benefits of owning and operating your own business continue to increase as you learn the ropes. Along the way, though, juggling income and expenses isn’t always easy.

Even seasoned business owners have periods of ebb and flow in their revenue. Because they’ve already been through the pattern, they’ve learned how to save and spend accordingly.

Part of strategic planning as the owner is knowing how to spend your money wisely. These smart tips are used by successful entrepreneurs around the world, and they can help you, too.

1. Set Up An Emergency Fund

If the COVID-19 pandemic taught businesses anything, it’s the importance of being prepared. Some companies weren’t able to handle a month or two of revenue loss until the government stepped in to help, and the businesses closed down.

How long will your emergency fund cover you if something were to keep you from working? It doesn’t have to be a global crisis. Severe tragedy, a car accident, and many other unforeseen circumstances could happen.

Setting aside untouchable money for an emergency fund is the first thing you should do with any extra cash. Until you have at least three to six months of expenses covered, don’t buy anything but the essentials.

2. Invest in Quality, Not Quantity

When money is tight, a great deal sounds like what you need. But it’s not a smart way to spend your funds if the investment isn’t high-quality.

Here’s a hypothetical example. You have enough money in your payroll account to pay for two subpar employees or one excellent person.

Two employees are always beneficial in case one is sick or quits. But for the pay, they don’t want to do the work, and what they do is full of mistakes. You’re always training them, and they never seem to learn.

On the other hand, the experienced employee doesn’t need as much training. You can trust them to do their job, even when you’re not looking. Yes, it’s a hassle when they get sick or take a vacation, but they do more work in 20 hours than the two subpar employees did in 80 combined.

Which option is a smarter way to spend your payroll? Paying more for better quality in every expense category, even if it doesn’t give you quantity, furthers your business.

3. Make and Stick to a Budget

When you first opened your business, chances are, you created a budget. Over time, as the daily operational expenses become familiar, it’s easy to veer away from watching your spending.

A budget is always a smart way to monitor your income and expenses, no matter how successful you are. Major corporations pay hefty salaries to teams that create and execute budgets. It’s definitely a worthy use of your time.

Back to the Budget Basics

If it’s been a while since you looked at your budget, start from scratch and take a deep look at your finances. Where is your money coming from? Where is it going? Is there any area that needs an overhaul?

Maybe you took out a loan when you first started out and are still paying on it. But if you refinance now, you could get better terms and pay it off faster.

By grabbing your budget by the horns, you can tackle your debt and spend your money more wisely.

4. Learn What’s Available to You

Small business owners struggle to run their companies alone. What many of them don’t realize is that there are a lot of entities that offer help.

For instance, it’s in the best interest of the state you’re in for you to be successful. You’ll pay taxes on your revenue, bring in contractors from other states, and boost the economy in general.

Grants and Low-Interest Loans

To help small businesses get and stay on their feet, there are hundreds of thousands of grants available. You may qualify for free money from private companies or government agencies.

These grants are almost always open to minority-owned businesses or small companies with less than 50 employees.

But if you don’t qualify for a grant, you could still be eligible for low interest rates on a loan. The Small Business Administration works with lenders to provide resources to entrepreneurs when they’re getting started or struggling.

By knowing what’s available to you, you’re ready with a fallback plan during your slow periods. Instead of taking out a loan with high rates or getting behind on your payments, you can turn to grants or low-interest borrowing.


A successful business owner knows that part of their financial strategy includes monitoring their income and expenses.

With these tips, no matter how much or little revenue you’re bringing in, you’ll be spending it wisely. Continued smart money habits will eventually help you reach your goals and have a thriving business.

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