How to Manage Home Based Business Finances?

Yeah, I know you do want to go to that rock concert, but can you really afford it? Maybe it’s better to save the money for brighter future, what do you think?

When you’re starting out and don’t have a lot of cash in your pocket, literally every penny counts. You have to buy food, and all other basic things in order to survive. But people tend to forget about saving money and spend on pointless things like new purse, clothes or restaurants.

One thing you need in order to succeed is discipline. I know, it doesn’t sound pretty and easy, but that’s what it takes. You need to work harder than others if you wanna see the light at the end of the tunnel.

Writing Down Your Expenses & Income

So how do you manage your finances when you start or have an online business? Write you’re your expenses. That’s the first thing you need to do.

Besides obvious basic needs, look at business expenses. Things like hosting, domains cost money. Take that into account. It’s good cause usually you prepay for a year in advance. So money’s gone and you don’t need to worry about it. But try to divide the yearly cost by 12 and see how much it costs you each month. Now look how much you spend on advertising.

If you’re running several affiliate marketing campaigns, then you need to keep it all on a spreadsheet. Excel or StarOffice or Google spreadsheet can help you with that.

That’s the main thing, writing it all down first so you know exactly how much money comes in and how much money goes out. And that’s for a total financial activity. Now you also need to keep track of your campaigns.

Tracking Campaigns with Spreadsheets

If you do affiliate marketing, and that’s what majority of people will do, then you’re running some marketing campaigns here and there. Assuming you’ve found success, then read further on how to keep track of the data. If you’re in testing phase, then allocate some budget from your regular job for testing online campaigns. It can be $50 or $500 a month. Whatever you can afford, but the more the better.

But if you do have some profit coming in, then write down the medium/traffic source, campaign name, spend, revenue, profit/loss, ROI. And if you’re one of the CPA affiliates doing bigger numbers, then you’ll also need EPC, eCPM columns for that.

You can track it each day or once a week. Get the data, write it down. And at the end of the month you can have a nice little graph showing your campaigns’ performance.

If you’re testing/making changes, take a note of that so you’ll know what caused a success or failure one or another week. This may seem like a lot of work, but you’ll be actually doing this only 10 to 30 minutes a day. The price is nothing compared to what it can do to you in the future.