Thought I'd take a moment to talk about money. It's been on my mind lately for several reasons, and realized I never talked about how I handle the financial part of my ceramics business. For about twenty years, I worked in the corporate world...had a consistent paycheck, benefits, and health insurance. 7 years ago, I left that behind which also meant I left behind a consistent paycheck, benefits, and health insurance. All those things are now up to me.
One piece of financial advice I received for the self-employed was to pay myself first. Let me explain a little more...for my ceramics, I keep the income and expenses separate...the money that comes in and out is for B. Cronk Ceramics only. I'm essentially an employee. Some people set it up like this and pay themselves a wage. What I decided to do was to pay myself a percentage of what the business earns at the end of every month. Let's say 10% as an example....so, if in one month ceramics makes $1,000, I get paid $100. But If ceramics profits $10,000, I get paid $1,000. And what I've decided to do with what I'm paid is divide it among a few different accounts such as an emergency fund, retirement savings, truck payments, mortgage, taxes, and fun spending.
You may be thinking how can I possibly live off what I pay myself from ceramics, and honestly, I can't. But I apply this all the other "businesses" I have which include running a short-term rental, freelance web development, handyman work, and mowing. I also work part-time on a flower farm, but that money goes directly to me since the farm work isn't supporting one of my businesses...it's helping to pay my mortgage.
Not having a reliable income can be a bit stressful, but with planning, it has definitely become manageable. The main change has been to thinking ahead. While I still have the same daily, weekly, and monthly expenses, having an inconsistent income has forced me to think about expenses I know I'll have in a few months (for example heating fuel) and to plan for the unexpected, be it medical or emergency home repair. This change in itself has altered my spending habits and I find I rarely make impulse purchases...and when I do, it comes out of my "fun spending" account.
I've found a system that works for me. I may be making a fraction of what I made while working in corporate, but I don't feel as concerned about money anymore. I'm much more mindful of my personal spending these days, and it doesn't cause me as much stress as it used to. I think that has more to do with a change in lifestyle more than anything else. As long as I have a roof over my head and food on the plate, the rest will fall into place.