4 Practical Tips for Building Up Your Savings to Launch Your Small Business

1. Figure out where your money is going — and where you can cut back.
The first step to saving more money for your goal: figuring out exactly where your current earnings are going, dollar-by-dollar.

2. Distinguish and automate your savings.

Create a dedicated savings account for your small business, and de-link it from your checking and other accounts so you’re not tempted to dip in.

3. Try lowering your “fixed expenses.”

The phrase “fixed expenses” implies they’re just that: fixed. On the contrary, items such as utility bills and credit card interest rates are often negotiable. First, make a list of your regular recurring expenses (usually charged monthly). You can do this by highlighting them on a printed account statement.

4. Make your money work for you.

When you do build up a savings stash, it’s important to make sure you’re storing it in the right place. For example if you know you won’t need your savings stash for at least one year, you can store it in a certificate of deposit (CD) — a savings certificate with a fixed maturity date, on which you can withdraw your deposit and the interest it’s accrued.