Home Entrepreneurship How to Account for Startup Lifestyle Costs.

How to Account for Startup Lifestyle Costs.

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Just the other day I googled about different stages in a startup funding, and I came across this infographic from Funders and founders.com.

How to Account for Startup Lifestyle Costs.

It has well explained how various levels of personnel can fund a new business or a startup.

However, it left me thinking how as the startup, are you going to impress the Angel investors throughout the journey of your business growth.

RELATED ARTICLE: 3 VITAL PRINCIPLES THAT YOU NEED TO CONSIDER BEFORE STARTING A BUSINESS.

Here is the answer: account for your startup lifestyle costs.

Accounting for your startup lifestyle costs is one issue that doesn’t come to most minds of startup entrepreneurs.

But as the business start to grow as the founder you need not worry about some things like,

  • Feeding your family
  • Transportation costs
  • Your rental bills and
  • Other personal effects

to avoid stressing your business investors.

So then, as a startup what are you supposed to do?

You are expected to include all your living expenses in your funding requests. Doing that will help you not to panic over your personal finances, and in return, you will be more productive and focused on your growing business.

Here is a good example from Bizfilings

Monthly Family Budget Schedule

DescriptionJanuaryFebruary
etc.
Annual
Total
Wife’s wages$3,500$3,500$42,000
Husband’s wages$2,000$2,000$24,000
Other income$100$75$1,800
Total income$5,600$5,575$67,800
Rent$600$600$7,200
Other expenses$3,000$5,500$37,800
Total expenses$3,600$6,100$45,000
Monthly extra   
(Short) cash$2,000($525)$22,800

What is the duration of the living expenses in your funding request cover?

I believe as the founder you should include 2-year lifestyle costs.

When planning for the startup lifestyle expenses, you should be realistic, honest and the figure should be workable for the estimated future.

Why 2 years?

It is not a must the duration to be two years, it can be one year or 6 months, but the reason why I have said two years is:

To give your business time to grow consistently, to enable it to compensate you in the future.

Conclusion:

As a startup, you should not give any loopholes to failure. Startup lifestyle costs can contribute to the failure of your business if you do not plan it well.

I would love to know your thoughts on this topic; please feel free to comment on the comment section below.

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