Essential Steps to Prevent Small Business Failure

Starting a small business can be an exciting and rewarding venture. However, without proper planning and market understanding, many small businesses face the risk of failure. This is a crucial step that every business should complete before even opening its doors. It is essential to understand your market and target customers before building any products and services. Many business owners make the assumption that what they personally like about their products and services will also be loved by the market. In this article, we will provide a 7 step-by-step guide for small business owners to adopt in order to ease risks and set their ventures on the path towards success. Conduct Market Research/Surveys: This step involves gathering data, analyzing industry trends, and understanding customer preferences. Listening to customers is a critical aspect that many business owners overlook. We hope business owners always dedicate time and effort to engage in a conversation and actively listen to their customers not just from the beginning stage but on a regular basis. You can’t build the right product and continue to improve on it without hearing directly from your potential consumers. You can consider the following approach: 1:1interviews, focus groups, online feedback then follow-up calls with interesting ones Asking questions on real demands, pain points, to how much they are willing to pay for the product or services. By understanding the market landscape, small businesses can adapt their strategies, and customize product or service development to meet customer demands effectively. Develop a Customer Profile: From the feedback and input from step one, entrepreneurs can proceed with building their customer profiles. This step is to help you answer the question: “Who are they?” Create detailed customer profiles that encompass demographic information, preferences, and buying behaviors. This will help you later adapt your marketing efforts, develop products or services, as well as decide on resources you should put in place to go after these customers try to capture the general information such as their professions, location, age, income, gender, hobbies and preferences. You can then do in-depth information as questions and answers about your products and services. Assess Market Size and Competition: Once you have identified your customer profile, the next step is to determine the size of the market and how many of these potential customers you can sell to. This is important for measuring potential demand and revenue for your business, and of course making informed decisions about pricing, marketing strategies, and resource allocation later on. Conduct Financial Projections: Once you generate the total potential customers for each city, for example, 1 million clients in Yangon, you would now need to conduct a financial projection for these customers. By projecting financials, you can identify potential risks, set realistic goals, and make informed decisions regarding pricing, investment, and resource allocation. Create a Marketing Plan: A well-defined marketing plan is essential for small business success. Remember, this marketing plan should be built based on various scenarios considered in Step 4. This plan should identify the most effective marketing channels to reach your target audience and develop strategies to engage and attract customers. Plan and Allocate Resources and Investments: From the marketing and operational plans, now it is time to consider the resources and investment required to execute your business plan successfully. Evaluate the financial, human, and technological resources needed to support your operations within the framework of the projected financial circumstances in Step 4. Entrepreneurs must determine the investment and resource allocation for both the worst and best scenarios. This would mean supporting your business growth and sustainability.  7. Establish a Scalable Business Model: Small businesses should plan for scalability from the start. Consider the potential for growth and expansion in your chosen market. Anticipating future challenges and opportunities is crucial for business owners to ensure their operations can handle increased demand and adapt to market conditions. Neglecting this step could lead to financial difficulties that may make or break the business. Conclusion: Starting a small business requires careful planning and market understanding. By following these essential steps – conducting market research, developing customer profiles, assessing market size and competition, conducting financial projections, creating marketing and operational plans, resources and investment decisions, and scalability for the future – small business owners can significantly reduce the risk of failure. We hope this guide will provide you with a solid foundation for your business’s long-term success.

Understanding Debt Management: Strategies for Taking Control of Your Finances

In today’s world, managing debts effectively is a crucial skill for achieving financial stability and peace of mind. Whether you’re dealing with liability debts, asset debts, or bad debts, understanding how to navigate them can make a significant difference in your financial well-being. You might have read somewhere about categorizing asset debts as good debts and liability debts as bad debts. However, our first rule of thumb is that all debts can be bad if you cannot afford to pay them or if you control more than what you need. In this article, we will explore practical strategies and rules to help you manage or pay off your debts, empowering you to take control of your financial situation. Let’s consider two scenarios, before or after borrowing money. A. Before borrowing money, please consider the following: Assess Your Financial Health: Begin by taking a comprehensive look at your financial situation. Evaluate your income, expenses, and existing debts. This assessment will provide a clear understanding of your financial obligations and allow you to develop a plan for debt management. Create a Budget and Prioritize: Develop a realistic budget that covers your essential expenses while allocating a portion of your income towards debt repayment. When considering borrowing money, look at the interest costs and evaluate how long your current financial progress can bring you back towards becoming debt-free. And on the budget  itself, your total debt should not be more than 40% of your total household income. Choose a Repayment Strategy: Choose the strategy that aligns best with your financial goals and motivates you to stay on track. For example, if you have a stable job with the potential for growth over time, you may consider obtaining a shorter-term loan to pay it off more quickly. Alternatively, if you anticipate receiving a substantial sum of money within the next 1-2 years, you could choose for a loan with a fixed interest rate from the outset and plan to pay it off entirely within that time frame. It is crucial to carefully examine the refinancing terms and considerations outlined in the contract as well. Reduce Expenses and Increase Income: Examine your expenses and find areas where you can cut back. Minimize flexible spending, eliminate unnecessary subscriptions, and make careful choices in your daily life. Don’t consider borrowing money for your daily expenses or luxury goods. Additionally, explore opportunities to increase your income, such as taking on a side job or freelance work. The extra funds can be directed towards debt repayment, accelerating your progress. B. After borrowing money, consider the following solutions to manage your debts effectively: The snowball strategy for debt is a method of debt repayment that involves tackling debts in a specific order. It starts by listing all debts from smallest to largest balance, regardless of interest rates. By focusing on paying off the smallest debt first while making minimum payments on the rest, individuals experience quick wins and build momentum. As each debt is paid off, the freed-up funds are then applied to the next debt, creating a “snowball” effect. This strategy emphasizes psychological motivation and progress, aiming to eliminate debts one by one until the last and largest debt is paid off. The silent killer strategy for debt interest rate is a method to minimize interest costs and accelerate debt repayment. It involves prioritizing debts based on their interest rates rather than the balance. Debts with the highest interest rates are targeted first, while making minimum payments on lower interest rate debts. By focusing on high-interest debts, individuals can reduce the overall interest burden and save money in the long run. The strategy emphasizes the financial impact of interest rates and aims to eliminate high-cost debts efficiently, allowing individuals to gain control over their finances and achieve debt freedom sooner. Negotiate and Consolidate: Reach out to your creditors or lenders to negotiate lower interest rates or more favorable repayment terms. Many lenders are willing to work with borrowers who demonstrate a commitment to repayment. Furthermore, consider consolidating multiple debts into a single loan with a lower interest rate. This simplifies repayment and potentially reduces the overall cost of borrowing. Avoid New Debts: While working on paying off existing debts, be mindful of taking on new debts. Differentiate between wants and needs, and practice restraint when making purchasing decisions. Avoid accumulating additional debts that could delay your progress. Seek Professional Guidance: If you’re feeling overwhelmed or need personalized advice, don’t hesitate to seek help from a financial advisor or credit counselor. These professionals can provide expert guidance, help you develop a personalized debt repayment plan, and offer strategies for long-term financial success. Conclusion: Effectively managing and paying off your debts is a crucial step towards achieving financial freedom and security. Managing and paying off debts requires discipline, patience, and consistency. By implementing these strategies and rules, you can transform your debts from foes   into friends. Take charge of your financial well-being, reduce stress, and pave the way for a more secure and prosperous future.

Top 10 rules you can consider controlling overspending

Controlling overspending can be a challenging task, but there are several strategies and rules you can follow to help you manage your finances more effectively. Today, MO Foundation would like to share our Top 10 rules you can consider implementing experiment with different strategies and rules to find what works best for you. Save First: We prioritize this rule at the top of our list, because it guarantees a solution to the issue of overspending. As soon as your monthly income is deposited into your bank account, make it a habit to automatically transfer at least 20% to a separate bank account. We have previous articles available on setting up accounts and utilizing automation in transfers. Consider this as “Pay Yourself” fund, intended for emergency funds, savings, or future investments. After allocating this amount, you can confidently spend the remaining without jeopardizing your financial security. 50/30/20 Rule: Allocate 50% of your income for essential expenses like housing, transportation, and groceries; 30% for discretionary spending such as entertainment and dining out; and 20% for saving belongs to the first rule we shared earlier. This rule helps you strike a balance between necessities and indulgences while prioritizing savings. Needs vs. Wants Rule: Before making a purchase, distinguish between your needs and wants. Ask yourself if the item is essential for your well-being or if it’s more of a desire or impulse. Not everyone can discern this, but another perspective on Needs expenses is that they are the ones that demand your attention, even if you may not want to pay for them. These are obligations that must be fulfilled, such as house rental, utilities, mortgage repayments, loans, and commuting expenses. While some individuals may argue that health insurance is unnecessary, we consider it mandatory for the safeguarding of both your health and financial well-being. Delayed Gratification Rule: Practice delayed gratification by postponing purchases and saving up for them instead. Set financial goals and work towards them before rewarding yourself with non-essential purchases. This rule cultivates patience and discipline while reducing impulsive spending. Use Cash or Debit Cards: Leave credit cards at home to avoid accumulating debt. Stick to cash or debit cards, as it forces you to spend within your means and prevents overspending. On a cash side, withdraw a predetermined amount of money each week or month and limit your spending to that amount. This rule makes you more conscious of your spending since you physically see the money leaving your wallet. We have also written the pros and cons of credit card. 30-Day List Rule: Create a list of items you want to purchase but aren’t urgent or necessary. Whenever you come across something you want, add it to the list and commit to waiting for 30 days before buying it. Often, after the waiting period, you’ll realize that you no longer desire or need the item. Once you are at this stage, you know this item belongs to the unnecessary lists. Subscription Audit Rule: Regularly review your subscription services (e.g., streaming platforms, gym memberships, magazine subscriptions) and assess their value. Cancel any subscriptions that you no longer use or find unnecessary. This rule helps eliminate recurring expenses that can accumulate over time. One-In, One-Out Rule: For every new item you bring into your home, commit to getting rid of one item. This rule encourages you to declutter and think twice before making unnecessary purchases. It also helps you maintain a more minimalist lifestyle. Garage sales could be the perfect way to recycle your unwanted goods and recoup some money in the process. Practice Minimalism: Embrace a minimalist lifestyle by decluttering and simplifying your belongings. Avoid unnecessary purchases and focus on experiences and meaningful relationships rather than material possessions. Plan for Special Occasions: Plan and save for special occasions, such as birthdays or holidays, in advance. This prevents last-minute overspending and reduces financial stress during these periods. These special occasions can serve as a tempting opportunity to indulge in excessive spending. However, it is advisable to plan your purchases strategically by taking advantage of big promotions and super sales. By doing so, you can enjoy the best deals available and save a significant amount of money. Moreover, find an accountability partner, such as a friend or family member, who can assist you in staying committed to your spending goals. Alternatively, you can also exchange methods that have proven effective for each other. Learning from others’ experiences can often be valuable. The crucial aspect is to be aware of your spending habits and make deliberate choices that align with your financial objectives. Remember, habits are formed through thoughts, actions, and repetition. Therefore, adjust your mindset! Begin by contemplating whether spending a dollar will bring you happiness, and consider how saving two dollars could be more advantageous in the long run.

Credit card: Take advantage, don’t misuse

In today’s modern society, Credit Cards have become an integral part of our financial lives. They offer convenience, security, and the ability to make purchases even when we don’t have cash on hand. However, many of us, especially younger ones, started to form with little cautious attitude towards them. It’s crucial to use credit cards responsibly to avoid falling into the trap of debt. This could eventually lead to more pressure and overall impact to your long-term financial goals. This article aims to shed light on the importance of taking advantage of credit cards while also emphasizing on the potential pitfalls which can ruin your financial life. The Benefits of Credit Cards Credit cards come with a range of benefits that can enhance your financial lifestyle. Some of the advantages include: Convenience: Credit cards offer a convenient payment method, allowing you to make purchases online, over the phone, or in-store without carrying cash. Safety: Credit cards provide a layer of security by protecting you against fake transactions. In case of unauthorized charges, you can dispute them and prevent financial losses. Rewards and Perks: Many credit cards offer rewards programs that allow you to earn cashback, travel points, or other benefits. These rewards can be a valuable way to save money or enjoy exclusive privileges like free air tickets for your short vacations. Building Credit History: Responsible credit card usage can help establish and improve your credit history, making it easier to obtain loans, mortgages, or favorable interest rates in the future. Emergencies: When in crisis, this could be the life-saver for immediate cash to get you over the financial troubles. If you receive benefits like interest-free payments for 6 to 12 months due to your excellent credit history, this could be advantageous. Before clicking the “borrow” button, double-check all of the costs because there may be any unnoticed ones, such as processing fees. However, as we will describe in the third section below, this could also be a double-edged sword. The Dangers of Credit Card Debt While credit cards offer numerous advantages, the misuse or abuse of credit can lead to financial instability and emotional burdens. Here are some potential risks associated with credit card debt: High Interest Rates: Credit card debt often carries high interest rates, meaning that even a small balance can quickly accumulate interest and become burdensome. Overspending: Credit cards may tempt individuals to spend beyond their means, leading to a cycle of debt and financial stress. Easily fall into impulse purchases as the tool is too convenient and right in front of you. Minimum Payments Trap: Paying only the minimum amount due each month can prolong the repayment period and result in more interest paid over time. Negative Credit Impact: Excessive credit card debt can negatively impact your credit score, making it difficult to secure loans or obtain favorable interest rates in the future. Delay to Financial Goals: Excessive credit card debt hinder your ability to achieve your long-term financial goals. When a significant amount of your income goes towards paying off credit card balances, you have less financial flexibility to save for future goals. Stress and Emotional Burden: You will be trapped in the cycle of paycheck-to-paycheck living, limiting your financial freedom. Dealing with an overwhelming credit card can take a toll on your mental and emotional well-being. You will be constantly worrying about making payments, receiving collection calls and emails. This could even strain relationships, impact job performance and diminish overall life satisfaction. Take advantage, don’t abuse: To ensure that you take full advantage of credit cards without falling into debt, it is essential to adopt responsible credit card usage practices: Budgeting: Create a monthly budget and stick to it. Understand your income, expenses, and prioritize your purchases accordingly. Assign not more than 30% of your total income to credit card purchases. Know that number by heart before you swipe that card. Paying in Full and Make it Automated: Whenever possible, pay your credit card balance in full and automatically each month to avoid interest charges. This practice ensures you enjoy the benefits of credit cards without accumulating debt. Limit Your Credit Card Usage: Restrict yourself to only one credit card. Having multiple cards can increase the temptation to overspend and make it harder to manage your finances effectively. Monitor Your Spending: Regularly review your credit card statements to track your spending and identify any unauthorized transactions. This practice will help you stay on top of your financial situation and detect potential issues early. Emergency Fund: Instead of relying solely on credit cards for unexpected expenses, establish an emergency fund. Having a financial reserve will reduce the need for credit card usage in emergencies. Conclusion: While credit cards can offer convenience and rewards, it is crucial to approach them with caution and discipline. The potential pitfalls of credit cards, such as accumulating high-interest debt, overspending, minimum payment traps, emotional stress and many more. By using credit cards responsibly and staying within your means, you can really enjoy the benefits of them and mitigate these risks and maintain a healthy financial trajectory. Remember, the key is to exercise restraint, prioritize financial responsibility, and use credit cards as a tool rather than a pathway to financial ruin.

How can you avoid recording daily expenditures while using a zero-sum budget? 

This article is to provide some practical information on how one person, especially busy and forgetful one, can keep track of his/her spending budget effectively just once or twice a month. You don’t have time to record your spending every day? Consider using a zero-sum budget method! Understand Zero Sum budget method Zero sum budget is a budgeting technique in which the total income minus the total expense equals zero. This means that every money earned is allocated to a specific expense or savings category. In other words, the goal is to ensure that all income is assigned a purpose, leaving no unallocated funds. Total Income – Total Expense = 0  But do not mistake it by thinking that you should spend all the dimes on buying things and making the ending balance equal to zero. Saving for the future or “pay yourself” should be allocated as part of the “total expense” as well. For example, if you aim to save 20% of your total income, the above formula should look like this: Total Income – (Total Saving of 20% + Total Spending of 80%) = 0  So, what example to help you understand the use of this technique towards your daily expenditures? Think of the zero sum for your daily budget, meaning you assign a spending budget every day for yourself, and as long as you bring that budget down to zero, you will stop spending for the day. Let’s follow this example for your better understanding: Early in the morning on a Sunday, Mary was given 10,000 MMK by her mother for her own spending within the day. Mary went out to the alley to eat a bowl of beef vermicelli for 3,000 MMK, and drank a cup of milk tea for 1,000 MMK. Mary then goes home after school but her bike has flat tires so she has to stop by the repair shop to fix it. Cost: 2,000 MMK. After she reached home and finished her homework, a few friends called to ask her out for afternoon games. Their plan is to stop by for a quick burger for 4,000 MMK, and then a friend suggested ice cream for 500 MMK. At the point of buying an ice cream, her daily quota of 10,000 MMK had been completed and she could not afford the ice cream. Her friend offered to pay for her, and said she could pay them back the next day. The friends later talked about going to dinner and a movie at night. It could cost them another 7,000 MMK for the day. At this point Mary had run out of her daily budget, and she could not let her friends pay for her, so she told them that she would want to head home instead. Once she reached home, she decided to eat whatever was in the fridge, then finish her homework early and went to bed. As you have already guessed, Mary only has 10,000 MMK to spend for the day. If she doesn’t know how to plan for her budget wisely, she will run out of money and have to eat instant noodles or leftover food in the fridge. Daily budget – 10,000 Bowl of noodle –             3,000 Milk tea – 1,000 Fix bike – 2,000 Burger –            4,000 ————————————— Zero sum balance         0 (at which time she needs to stop spending) So how does the above method allow us to avoid documenting every single spending item? Imagine that we might not have the time or the memory to write down every single item: like a milk team or a movie ticket. You therefore set a daily spending limit for yourself, and once you’ve hit it, your spending is done for the day. If you choose to tap into other funds, your quota for the following day will be affected, and you will know that you have exceeded it. By this method, you can save time from writing down every item on a daily basis. Just be cautious to schedule your day and strictly stick to your budget every day. Using the above-mentioned illustration, and recalling that we have previously discussed the spending towards NEEDS (50%) and WANTS (30%) based on 50-30-20 rule, you can guess Mary’s overall monthly budget from her income to spending. Let’s say Mary is a young working professional now paying from her own income, instead of receiving money from her mother:  Income = 1,000,000 MMK  Saving 20% = 200,000 MMK  Spending 80% = 800,000 MMK  50% for NEEDS (rental, transport, grocery) = 500,000 MMK 30% for WANTS (entertainment, fun with friends) = 300,000 MMK The zero-sum budget we’ve been discussing means that 300,000 MMK / 30 days = 10 ,000 MMK daily quota for Mary as previously illustrated. If she follows this budget and quota, she simply needs to know her daily budget and track her daily spending based on the quota. Then at the end of every month, she just needs to sit down and look at the monthly budget to ensure that she keeps under the percentages she sets for herself. She won’t need to record every single expenditure detail on a daily basis. Are we all like Mary? Have no time or discipline to record every single item on a daily basis? This method by no means applies to everyone. You still need to understand your spending habits and categorize them to know that you do not overspend on unnecessary things. For example, if you overspent on unnecessary things (the WANTS), then this method might not be for you. We are recommending this because there are many budget tools out there for you to choose from. As long as you are familiar with a particular tool, and already have a consistent discipline for many years, we encourage you to continue that. As long as you do not choose any tool that is too complicated to start with, then stop all together after a few months after using it. Budget

What are the skills a business owner needs to possess?

Being a successful business owner requires a combination of skills, knowledge, and behaviors. In this article, we will explore the top 5 skill sets any business owner should have, improve on, and develop! Nobody excels at everything, yet as a business owner, there are occasions when you must try to “do or know it all.” Because few people are born with essential business potential, it is sometimes required to develop skill sets through time. Entrepreneurs have unique challenges throughout the early phases of their firm because they must excel in a variety of areas, including leadership, strategic thinking, negotiation, marketing and sales, communication, problem-solving, time management, adaptability, networking, passion, and drive. Failing to understand or effectively manage these skills can lead to burnout. Consequently, MO Foundation has identified the top five skills that we believe every business owner should prioritize and develop: Leadership (People) Finance Marketing & Sales Operations Technology By focusing on the development of these skills, business owners can position themselves for success and overcome the challenges that come with entrepreneurship. The advantage is that if a business leader lacks any of the skills mentioned below, they can delegate or hire individuals with the required expertise to bridge those gaps. Nevertheless, it remains crucial for the business owner to possess a fundamental understanding of each skill set in order to efficiently manage their business and make informed decisions. The importance of these abilities may also be ranked differently depending on the size of the company. For instance, it is ideal to start by concentrating on skill set number 1 – leadership – in the case of a small organization with less than 10 employees. Leadership A business owner must possess the ability to effectively lead, delegate, and manage their team. In addition to that, they are responsible for establishing a compelling vision for the company and making strategic decisions that will propel it toward success. Furthermore, they must have the capacity to motivate and inspire their employees, offer guidance and support, and handle any conflicts that may arise. For every leader, effective communication is a necessary skill. Your chances of success are lessened even if you have great ideas and a clear strategic vision if your team members are unwilling to follow you. Unfortunately, a lot of business people think they are good leaders by default and fail to see the value of meaningful and frequent team communication. Delegation does not imply a lack of leadership skills or experience. It involves recognizing and accepting your strengths and weaknesses, and seeking help from others. Running a business requires collaboration; you can’t do it alone. Delegation leverages team strengths, and trust and an empowering culture are vital for a thriving business. Avoiding micromanagement fosters growth, productivity, and trust. Finance A business owner should possess a strong grasp of finance management, which encompasses budgeting, forecasting, and accounting. It is essential to effectively manage cash flow, make sound financial decisions for long-term company benefit, and ensure the business’s financial stability and sustainability. While not everyone may have a financial background, MO Foundation advises to hire an accountant (for small businesses initially) and a finance manager (as the company expands). While outsourcing or delegating, business owners should continue to gain an understanding of their company’s financial health through numbers and data analysis. These financial skills will also facilitate better management and navigation of other aspects such as taxes, regulations, and securing funding during the growth stage when necessary. Marketing and Sales A business owner needs to possess a comprehensive understanding of their target market. They should be capable of effectively communicating the value of their product or service and devising successful marketing strategies to reach their intended audience. These skills are crucial in closing deals and generating revenue for the company. Operation A business owner must be able to manage day-to-day operations of the company. This area involves functions like customer service, product management, accounting, supply chain and logistics management, etc. The operational managers should also be able to identify areas for improvement and implement new effective processes and policies. Overall, you want your business to increase processes efficiency, reduce costs, and can respond quickly to the changes in demand. Imagine the pandemic crisis, only companies who can quickly respond, change, and adapt would be able to overcome the challenges in time. Technology In today’s digital age, a business owner must consider having a good understanding of technology and how it can be used to benefit their business. Your business can not scale and grow quickly enough if technology is not utilized effectively or kept up with latest trends and developments within their industry. Technology can also help increase the efficiency of the operation and processes stated above. Setting the culture for your business It’s not uncommon for some leaders to have a tendency to micromanage, even though they understand the importance of delegating tasks to others. There can be several reasons for this behavior, such as a lack of trust in others, a desire for control, or a fear of failure. Micromanagement has the potential to impair performance and shape the company’s toxic and egoistic culture. Employees may get disengaged and less productive if they do not believe they can execute their job effectively. This can result in high employee turnover (which is expensive for the organization), a lack of innovation, and lower-quality work. It can also make it difficult for executives to focus on strategic decision-making and long-term planning. At the end of the day, each leader needs to ask themself, performance or trust? You can train people to perform better, but you won’t be able to drive success without building a trust-worthy workplace. On the other hand, leaders who prioritize trust over performance may run the risk of allowing poor performance to go unchecked, which can also harm the company in the long run. It’s important for leaders to set clear expectations and provide feedback to employees on their performance, while also empowering them to take ownership of their

Should you continue a 9-5 job or set up your own business?

  This article is to provide some consideration points to anyone (especially Gen Z) who is thinking of quitting a job to set up a small business. The dilemma of being an employee or an entrepreneur with its myriad of ups and downs is not unfamiliar to Gen Z. Although everyone has their own career aspirations, many have experienced “seismic shifts” deep in their passionate hearts. Before taking the plunge, considering all options is necessary. Let’s explore how to decide between being an employee or an entrepreneur, as well as some tips to boost your morale! Understanding yourself first Whether you want to work in a specific field or start from scratch, understanding your passion (what you love to do) versus your strengths (skills and talent) is essential. In other words, you need to understand yourself, and what are you willing to do to improve yourself before taking any big decision that could impact your financial life. You can take some time to answer a few questions such as: What specific work do I like to do? For example, do I want to start a food business or work as a finance employee at a large bank? What are my strengths (skills, talents) for that work? For example, if you have a business management degree and your family has a business background, you have a good understanding of entrepreneurship. What other requirements do I need? For example, being an entrepreneur requires many strong skills and wears many hats, i.e. leadership, finance, people management, and operation. What would you plan to do to brush up on these skills while still having a 9-5 job? How do you plan for the financials, both for personal as well as business goals? Remember that both of the goals are different, and therefore you need to plan carefully so your personal goals will not be impacted if your small business takes a longer time to reach stability. The above is just some of the suggested questions by MO Foundation for you to start, but there are many other questions in the journey to becoming an entrepreneur.  More questions can be asked, depending on each situation, desire, ability, financial and personal circumstances. Talk to others who have gone through similar journeys. Find your community to support you and your dreams.   What do you need to prepare to become an entrepreneur? You may see many “successful entrepreneurs” excite you on social media by saying that “starting your own business will give you freedom and financial independence”. It might be true in some cases, but it is a long and challenging journey.  Don’t just take the words for it, you have to focus on your plan, and carefully prepare to avoid unnecessary risks. Firstly, you should thoroughly research the field and market you want to start a business. Carefully study potential customers, competitors, trends, and potentials in the field to get an overview of the market and orient your product or service. Next, you need to plan in detail about your finances. This is one of the most important factors to ensure the success of the startup. You need to carefully calculate the initial capital, operating costs, expected profits, and repayment time if you lend money to start the business. In addition, you should also seek and build relationships and network with partners, suppliers, potential customers, and employees while you are still at your employment. These are the people who can help and support you in the process of starting and developing your business. Finally, you should not quit your 9-5 job yet unless you have a concrete plan and started some small steps in building that plan. Build the funds for at least 12 months of expenses for yourself, besides the initial investment capital for the business, as this might be the time when you do not have a steady paying income to support you when you quit the job. If you want to continue your 9-5 job as an employee, what then? Working as an employee is perhaps the starting choice for many young people before taking the “leap” in their careers. Working as an employee gives us experiences, relationships, and perspectives, and builds a foundation for our lives in many aspects. And if you take your job as your own business, i.e. having that entrepreneurship spirit, you might go far in your career development. Each person will have a different purpose for working. Some want to advance and become “irreplaceable” in the company, while others want to have a high salary that matches their abilities as they grow to become a leader in the company. There are also those who work for the sake of waiting to pursue their passion in becoming an entrepreneur at a later time. Depending on each purpose, you will plan and prepare for different stages. For example, after 3-5 years of working, you may want to see the promotion in terms of both ranking and financially for yourself, or you could consider starting something on your own. We did mention before that you should equip yourself with an entrepreneurial mindset even when working for somebody. What do we mean by that? It means you have to be dedicated, flexible, proactive, humble, responsible, constantly learning and updating your knowledge and expertise in any job. Best of all, never give up when things get hard, because that is the ultimate spirit of an entrepreneur.  This could help you to be given more responsibilities, and potentially move up the corporate ladder in the future. Promotion in the corporate environment is not necessarily happening to everyone automatically. You need to brush up on your negotiation skill to be confident to talk to your boss and set the development plan for yourself. If you stay stagnant in the job, both in ranking and financially, you will not develop and increase your values over time. And the other risks could potentially involve being laid off when the company is not doing well, or the

How to set up accounts between personal and business accounts?

This article is to provide some practical information on how one person should set up and manage their business accounts. Separating from individual accounts for transparency and legal purposes. Any business owners, at one point, will have to decide on setting up bank accounts to facilitate the operation of their business. We will focus on steps to help you with setting up and managing business accounts in this article. Previously, we have also shared with you two articles: Reasons for separating business and personal money, i.e., Managing money for individual vs. business (https://mo.com.mm/articles/managing-personal-and-business-finances/) Account management for personal accounts (https://mo.com.mm/articles/tips-to-set-up-and-manage-your-financial-accounts/) After weighing the benefits and drawbacks of keeping personal and business funds separate, you must decide whether to create business accounts under your own name or the name of your company. Or whether you even require a business bank account for your company at all. It will depend on the business’s size and structure, legal framework, and license requirements. Option 1: Account under the founder’s name This may be an alternative if your company does not need an account in its name. In Myanmar, a “cottage” firm or small company with a small staff (3-5 workers) can open a bank account in the owner’s name without any difficulty. But, if you go with this option, you should still think about keeping your accounts separate – one for business use, the other for personal use. This will enable you to organize your finances transparently from the start. A robust and transparent financial and accounting system can come in handy if you ever decide to grow your business later and need to find outside investors for funding. If you are the owner of the following businesses, go for this option: Self-trader Freelancer A single restaurant, shop, or online shop Your company does not deal with invoicing, and only pays a flat tax. It makes life easier for you when it comes to filing your tax returns when you separate your personal income tax and business tax. It will be simpler to report your business expenses, such as marketing and business growth, under the business account as opposed to mixing them with personal expenses like paying rent, utilities, and other household expenses. Another thing to bear in mind when using your personal account for business is the bank’s terms and conditions. Some providers explicitly state that using a personal bank account for business purposes is in breach of the terms of the account. Your account could be closed, or some features could be restricted if you are found to be using it for business. Option 2: Account under the business name You are required to open a bank account under the company’s name shown on the license when your company deals in higher quantities and contracts with your vendors and clients. If you operate a marketing agency or educational platform, for instance, other businesses may contract with you for services, and the payment may need to be paid to the business’s account. Please be aware that there may be increased costs associated with opening a business account. You may choose to create both personal and business accounts with the same bank. One-stop shops or bundled services may be offered at preferential prices by some banks and fintech businesses. Please check the information in detail with your nearby banking partners. If you are the owner of the following businesses, go for this option: Cottage (below 9 employees) and Small (10-15 employees) Services companies like marketing, education, clinics…. Non-profit organizations that engage in fundraising Import/export and E-commerce One store aiming to grow into multiple chains, franchise You have co-investors or co-founders in the business Option 3: Hybrid between personal and business accounts On one hand, you are not legally required to open a business account; on the other hand, it actually relies on what your business partners, clients, and suppliers expect in business contracts. For tax purposes, there is a difference between personal income tax and corporate tax from the transaction’s inflow and outflow from these two-account setups. For example, if you run a store that sells food and beverages, you usually would open a bank account under his/her name. However, if a company wants to engage your shop for their special event where you are catering for all their staff, this company might require you to sign a contract with your company instead. They will settle payments only to the account under the business name and you will need to pay corporate tax on this income. Another example is that your company is an education platform. Your company often signs contracts with your clients and suppliers for the coaching services you provide to their employees. Now if there is a special event, they want to engage only you (the owner) as a speaker in that event, they might request to sign the contract with you only.  The settlement, at this time, will go to the bank account under your name. You need to pay personal income tax for this income. The below graphic is the comparison of both personal and business accounts: A – You save up your personal money to invest in your company. Step A – you draw the funds from personal account no.3 and transfer them to Business account (as a registered capital). B – If you draw a salary or profit from the business, this fund will transfer back to your personal account. As the owner, you have to decide if you want to withdraw a salary, or profits based on your financial goals. You also need to work with the accountant to understand the impact on the accounting book. For example, salary is a business expense and can be deducted from tax. And the salary can serve as your personal income and save towards big goals later like buying property for you and your family. Profit will incur business tax. And the profit from the business could be used to share between business owners and reinvest into expanding the

Sources of Capital for New Business

Starting a business is an exciting venture, but it also requires careful planning. You must have enough money saved up for the initial investment before you can even start to launch a small business. In fact, we have discussed three forms of financial planning you need for your small business in the previous article (https://mo.com.mm/articles/financial-planning-for-your-small-business/). They are 1. Startup costs, 2. Break-even point and 3. Cashflows The “Startup Costs”, or initial investment capital, is the first important financial step. We have previously shown you the template you can jot down all expenses that make up the “Startup Cost”. You have determined that you need 20 million MMK to open your F&B store after going through this exercise, and the next step you need to know is where this money comes from. In fact, you will see the funding section on the “Startup Cost” template as captured below:   Potential Sources of Funding: Your own funds Loan Investment Community capital supports Option 1: Your own money Following the example that you need 20 million MMK for setting up the business, if you don’t have enough now, you can think about starting small and saving up while running your business. For instance, can you sell food online first, before renting a costly venue? It implies that your business must generate minimum revenue in its first few months in order to fund the operation and grow slowly, or you can think about taking on side jobs to save money and launching the business when you have enough. In this way, if the business falters, you can still rest assured that you have a backup job to fall back on. If you have carefully planned your funds, you can save up to 20 million MMK in a shorter period with compound interest. It means that you do not just put the money in piggybank style, try to find a channel that can give you a decent annual return to help your money grow faster. We have explained or calculated how the money grows with compound interest in Account Management (https://mo.com.mm/articles/tips-to-set-up-and-manage-your-financial-accounts/) Option 2: Loan Friends and Relatives: In the early phases of the businesses, owners can combine personal funds with loans from friends and relatives. This way you reduce the investment capital for yourself if you have not saved up enough. Before accepting any money from family or friends, it’s crucial to consider and talk about the idea of borrowing without interest versus a loan to prevent future conflicts. You really don’t want to lose a relationship over money matters. However, this no-strings-attached arrangement seems easy at the beginning, but your friends and family feel they have the right to participate in your business or ask you to return the money out of the blue. Credit institutions: The next best option for a start-up or small business is micro-loan through banks and other credit institutions. The two types of financing that banks offer to new businesses are term loans and working capital loans. These loans could be in the form of non-collateral or collateralized with your assets (property, car). However, please be careful of the high interest and penalization if you do not pay back in time. Almost all public and private sector banks provide loans for new businesses. The interest rate, loan size, and repayment period offered will differ from bank to bank. However, not all small businesses are credit-worthy to get a loan from banks. The processing and strict credit assessment could be a deal-stopper for many businesses to get to this source of funding. Some fintech or microfinance might serve lower credit customer profiles, therefore, involve certain risks. Option 3: Investment or Equitization Individuals with surplus cash are known to be Angel investors and they could be interested in investing in new start-ups in Myanmar. Another level up from individual investors is institutional levels like startup investment funds, venture capital, and accelerators. However, your small business might not pass the investment grade level unless your business has the scalability potential or disrupts the market by technology. The risks involved in these investments by investors are more, as compared to loans offered by financial institutions. They only invest for higher returns to profit, therefore increasing pressures for business owners and they also get a share of your business in return. That kind of “strings attached” situation means that you are not in full control of your business. The disadvantage of investment funding is it would take longer to find a suitable investor. Another disadvantage could be your company would need a robust reporting, audit, and financial system to assure transparency to the investor. This will require a significant amount of your time and resources, diverting you from your primary objective of growing the business. Option 4. Community capital supports In addition to capital support, startup businesses might need other resources (expertise, non-financial support). Some social platforms, associations, and foundations can be great places to incubate your business ideas.  Capital is limited but knowledge is immense. Good leadership experience can maximize your initial investment and lead you to success. You may have good ideas but to bring business to success, there are many phases to bring your ideas to life (product build, marketing & sales, operations, human resources). Conclusion Before starting a business, it’s crucial to research prospective sources of funding and create a solid investment strategy. Making sure you have the required cash is essential, so looking into possibilities like angel investors, loans from banks or friends/family, and association support might be helpful. It’s time to make a realistic budget with both short-term and long-term objectives after you’ve determined your desired source of funding and calculated how much cash you’ll need for launching your new business. This will assist in keeping your finances on track while enabling flexibility in case the market shifts or an unforeseen circumstance arises.

The Power of Compound Interest: The 8th Wonder of the World

The Power of Compound Interest: The 8th Wonder of the World Albert Einstein once said, “Compound interest is the 8th wonder of the world. Those who understand it will make money, those who don’t understand will have to pay for it.” It is possible to achieve financial freedom and enjoy your retirement years to the fullest and happily if you understand why compound interest is called the 8th wonder of the world, and apply it to your savings or investment. Compound interest is when you receive the interest on the savings, you do not withdraw it. You leave it with the principal and reinvest all of it. Compound interest will bring you a “huge” income after a couple of years if you automate the reinvesting process. Investment genius Warren Buffett once revealed the secret of his 100 billion dollars wealth: “My wealth has come from a combination of living in America, some lucky genes, and compound interest.” The good news for you is that you can absolutely become a self-made millionaire if you know how to use the power of compound interest, combined with regular, consistent investment over a long period of time. It can be invested in a lump-sum amount or on a monthly or quarterly basis. We will show you how to calculate in both scenarios. Let’s start with the first example when you have a lump sum of 1,000,000 MMK. You plan to invest or save with an annual interest rate of 6.5%. We have two formulas to calculate interest: *Simple interest: Amount of capital * (1 + interest % * number of years) *Compound interest: Amount of capital * (1+interest) ^ number of years If applying simple interest, after 10 years you get: 1,000,000 * (1 + 6.5%*10) = 1,650,000 MMK And with the compound interest, you will have: 1,000,000 * (1 + 6.5%) ^10 = 1,888,000 MMK (rounded). To grow more money with time, you will have: 1,000,000*(1+6.5 %) ^40= 12,400,000 MMK (rounded), if you wait for 40 years. “The longer the milk is fermented, the stronger and ripening the cheese will be”. You can see your finances grow exponentially, the longer you let the compound interest grow. Some compound interest calculators can help you calculate your numbers easily. You just need to “fill in the blanks” with the principal, the amount you deposit (monthly/quarterly/yearly), how long you save, and the annual interest rate you gain. Captured below is one example from http://www.moneychimp.com/calculator/compound_interest_calculator.htm Can your 100 USD (200,000 MMK) help you reach your financial freedom? The second example is when you save on a monthly basis and do not have a lump sum of money to start with. Don’t worry, you can also be a self-made millionaire too, following the case below. Let us share what Suze Orman said to understand why you have to start early! Suze Orman is an American financial advisor, author, and podcast host. She said this on her own TV show – The Suze Orman Show on CNBC Channel. She says you can become a millionaire if you invest your 100 USD monthly savings consistently, with the multiplicative power of compound interest. We have calculated for you using the same compound interest tool so you can see what your investment can bring you if you start at 25 years old, investing in the channel with an annual yield of 11.5% (all rounded numbers): In 20 years, you will gain 93,000 USD or 195,000,000 MMK In 30 years, you will gain 300,000 USD or 630,000,000 MMK In 40 years, you will gain 1,000,000 USD or 2.1 billion MMK Imagine if you miss the beat just for 10 years, say you start at 35 years old instead of 25 you will lose 70% of your financial freedom goal (1.47 billion MMK). Just in 10 years, you can see how much compound interest has grown your money. We also understand it is not easy to find an investment vehicle that could give you a yield of 11.5%. Follow us when we talk about investments in the later articles. And as you may know, as we age, we face greater challenges with our families, jobs, finances, and health. When making important decisions, you will be extra careful because of the “mess” swirling around in your thoughts. So why not start saving and investing early to have a good financial path and become more affluent while we are still healthy, youthful, and have more opportunity to grow capital flow? The Rule of Discipline: Consistency and Resilience Don’t forget the most crucial rule when we talk about compound interest: discipline. Regardless of whether you have recently achieved the “highest” yield for your saving deposits, or received a “bargain” return on your investments, you won’t be able to enjoy the growth without having discipline! Compound interest will break if you plan to “dip” your hands into the capital gains in order to pay for a new handbag, or fund a luxury vacation. When you withdraw these earned interests and break the cycle of compound interest, you may need to put more effort into rebuilding the capital again. So, please keep in mind that starting to save money early gives you a benefit; using compound interest over time will enable you to reach your financial objectives. If you’re persistent, you’ll get to taste the cheese in your golden years of retirement like a millionaire.

Journey to Financial Freedom

Many of us may have said – I want financial freedom. But when asked, you don’t know what is the exact number that could support your retirement. Think of it as a financial map, if you don’t know your destination, you can’t plan for the drive. And if you don’t plan for the drive, you would not know what is the fastest way to reach that destination.  So, what is the definition of “financial freedom” for you? There are many rules and definitions and various levels you might find on the internet nowadays. For easy sake, here are the three simple levels for your reference: Level 1 – a number that could cover your “Needs” Level 2 – a number that could cover your “Needs” + “Wants” Level 3 – a number that could cover all your “Needs” + all your “Wants” to achieve the lifestyle you dream of. Let’s name the three levels as follows: Level 1 = Financial Security Level 2= Financial Independence Level 3 = Financial Freedom   Financial Security For this first and basic financial threshold, you need to have an amount that is sufficient to cover all essential daily living expenses (or we say your “Needs”) such as rent, living expenses, utilities, transportation, and medical expenses. The basic necessities that you can’t live without, and without them, your life will be impacted. As an example, rent + utilities + transportation + food + some medical bills = 700,000 MMK/month. Applying the 25X Rules*: 700,000 MMK x 12 months x 25 = 210,000,000 MMK You can multiply by 5 or 30 times, whatever numbers could give you a level of comfort and security. If it is 30 times, the total number is 252,000,000 MMK. It means that the minute you have saved up to 210,000,000 MMK, it will provide you with quite a “secured” life, with monthly expenses of 700,000 MMK for the next 25, or 30 years of your life. You can actually say you have reached Level 1 – financial security. Financial Independence After you have defined the end goal of Financial Security, you might want a little more entertainment in your life. You may want to go to the movies, bar, or travel once a year. Whatever the costs associated with these “Wants”, you can add that onto the previous number. Now, from your previous example, your figure of 700,000 MMK/month is not enough for you to go to the movies or bars every week and travel once a year with your family. You need an extra 300,000 MMK/month for this. That means you will need a total of 1,000,000 MMK/month for your Needs and Wants expenses. Applying the 25X Rules*: 1,000,000 MMK x 12 months x 25 = 300,000,000 MMK Once you have acquired this amount, you can say “I have reached level 2 of Financial Independence”, where you can allow yourself to live on 1,000,000 MMK/month for the next 25 to 30 years of your life. At this point, you could actually decide to quit the job or just follow your passion in life without worrying about the financial situation. Financial Freedom This is often said to be the most ideal destination because we know most of us once dream to reach financial freedom. But each of us interprets the word “freedom” differently. Financial freedom could mean you are able to do the things you most desire in life and live the most comfortable and enjoyable life after years of hard work. It could be buying a villa, retiring, traveling, shopping for luxury brands, or simply wanting to build your own farm, fish pond, and grow vegetables. As for this level of financial freedom, we believe there isn’t a specific number, because everyone will have different expectations and pursuits. After you cover your “Needs” and “Wants”, calculate if you need another 3 million, 5 million or 10 million a month to reach the “lifestyle” you want. Sometimes, it is not the number but you just want to feel happy and fulfilled, free from money pressures and worries. That is still the Financial Freedom definition for you and your family. And from this number that you have come up with, for example, it has to be 100,000,000 MMK/month for your lifestyle and freedom of living, apply the 25X rule you will reach the total number of 30,000,000,000 MMK in order to call yourself “financially free”. At this stage, once you know the number, you need to start saving and investing now, set the timeline of when you want to achieve that numbers, and how you go about doing that. This is called the overall money plan and management in order to help you reach your goals. We hope the next time you set your financial freedom target, you know how to calculate your own number. Depending on what your financial goals are, please note that we have not discussed whether you should have health insurance, and property as an asset from this goal. That means you have to prepare to save or invest in order to have your health covered, and a roof for your family. *25X Rule is simply an estimate of how much you’ll need to have saved for retirement. It is not 25 years, but sometimes people could easily misunderstand that we should multiply with the number of years we expect to live up to. Please note that if you live during economic turmoil, this rule might not apply because you might need more money to cover the losses during the recession.

Financial Planning for Your Small Business

We measure the health of the business by looking at the financials. But this is your first time setting up your own business, and you don’t know where to start. We understand how complicated and difficult it is for you. Follow us and we will show you the importance, and step-by-step building of the basic financial foundation for your business. As many small businesses start out with no prior financial knowledge, you are not alone. There are millions of small business owners like you. Whether it is an F&B establishment, a flower shop, or an online store, you need to understand a few fundamentals to determine how much money you will need to invest initially and how to sustain the earnings in the future. It is not something you want to learn about your company. You don’t want to learn that your company may be in peril six months after debut because you miscalculated your sales or your pricing. And if the next “floater” isn’t thrown to you in time, you’ll have to scramble to find more cash or decide to shut it down. You must at least start with the Startup cost on day one, which may be much earlier than the actual debut date of your business. Startup Cost  You want to know how much money you have to invest and whether you need additional financing or partners to invest in your business. You learn from your pals that she invested 10,000,000 MMK to launch her online food business. Yet since every business has a unique vision, strategy, and set of goals, you wouldn’t know if it was the same for you to start. You can begin with these figures:  One-time costs (license, registration, opening event, ads) . Monthly ongoing costs (rent, wages, and six months’ worth of emergencies by taking the Ongoing costs multiply by 6)   Equipment and other Assets: machines, equipment, app/technology.    Break-even point  This is the time when you need to calculate how many clothes items or bowls of noodles you need to sell in order to cover all of the store’s costs. This would prompt you to figure out how much to charge for your goods and services.  Let’s look at this from a simpler standpoint. Starting with Step 1 – Startup Cost, you already know what your stores’ ongoing costs will be. If you determine that your cost is 1,000,000 MMK per month, you will then know that you must sell:  1,000,000 MMK/ 2,000 MMK* = 500 bowls of noodles 1,000,000 MMK/ 5,000 MMK* = 100 pieces of clothing (*you set the pricing for your products as 2,000 MMK/bowl or 5,000 MMK/item respectively) Your breakeven point will then be clear to you. That amount must be sold in order for you to earn enough money each month to cover your costs.  Following this step, you need to do a little more research, so here are some questions to consider:  Is the 2,000 MMK price per bowl appropriate? Does it at least give you 70% of the profit? Is the neighboring shop able to sell that quantity per month?  Can you sell more than 500 bowls? Or you have to raise the price to 3,000 MMK to earn more margins. This stage will enable you to determine the minimal point of quantity required for the survival of your business. Also, this step will give you the flexibility to adapt to the market and competition. Cashflows You must be aware of your cash inflows and outflows in order to determine whether you have enough in the bank to cover your monthly expenses. For instance, because the contract you signed with the clients dictates three months of services, and your clients did not pay you on time this month but only 3 months later, then you might not have enough in the bank. You need to know how much money you have left in the bank to pay your staff and other running costs. Please take note that the cash flow statement should include the six-month emergency fund.  We understand that your business is not a large company to own many financial statements. We have created a simple template, an all-in-one template for your reference or use. You can then customize it according to your business needs going forward. If you find the template difficult to use, contact us for potential upcoming workshops offered by our foundation to all small business owners.  Please visit the template here.

5 simple ways to increase income from personal hobbies

Develop skill sets or follow hobbies that could eventually help you increase additional income outside of your main salary.

Develop skill sets or follow hobbies that could eventually help you increase additional income outside of your main salary. Hobbies such as crafting, writing, photography, etc. can absolutely bring in a significant source of income if you have good skills and invest the time and effort. In addition to salary and business interest, each person has the ability to increase income in many different ways. In particular, turning your hobbies and strengths into a money-making tool is one of the good ways to improve your quality of life. If you have good writing ability, start a website or blog and if you love creating impressive crafts, a small shop is an ideal suggestion. This side business can take a long time to build, but, with persistence and perseverance, you can turn your hobby into an income generator. Writing The ability and interest in writing bring young people many values, including the opportunity to develop their own careers and a stable income. Currently, the writing profession is quite diverse, spanning many fields, not limited to writers, poets, and story writers. You can create content for websites, blogs, social media, press collaborators, etc. People who are interested in exploiting in-depth content in a certain field, and interested in composing have their beginnings by building a blog of their own. When there is stable traffic, the website brings in profits from links, ads, and sponsors. More simply, you can “sell” your article product as a service. Many websites and social networking groups to share information and find freelancers are active. Articles are paid according to quality and volume. WordPress, Wix, Squarespace, and fiverr.com, can be suggestions for those of you who want to seriously start writing. Design Similar to writing, illustration, and graphic design are “money-earning” hobbies that young people can consider if they are interested in this field. Some companies, and projects, need short-term creative staff, you can take the job based on your free time, and create images anywhere you feel comfortable. Based on this hobby, you can have your own business by printing your work on t-shirts, shoes, bags, etc. Now, this creative market is quite competitive with more and more young talents. You need to capture customer trends or build a unique, impressive brand. You can easily put your designs into products of shirts, pants, and masks and sell them on some convenient websites such as Print on demand, wall art, merch by Amazon, Teespring, and Redbubble. Meanwhile, creativemarket.com, Canva, and Placeit are places where young people share and sell their ideas. Cooking Being good at cooking and presenting food beautifully is one of the signs that you can turn this hobby into a source of income. You can start creating blogs, YouTube channels, or Instagram accounts to share your cooking experiences and new recipes. Many people have succeeded and earned income from advertising and sponsorship. However, you need to create content and present it in a different form to make your own mark in the culinary community. According to a Google survey, 54% of people aged 25-34 use smartphones in the kitchen. They search for delicious recipes on the Internet and practice in their kitchens. In addition, the development of e-commerce and food delivery platforms also creates opportunities for young people to sell dishes and ingredients, and earn extra income in their free time. Photography Photography is not only a hobby but can also bring you income if you know how to exploit your subject and strengths. Selling photos online, taking product photos, and participating in photo contests are some of the ways to make money with photography. If you have a knack for taking photos of a certain genre such as landscape, or portrait, you should try posting good-quality photos on copyrighted websites like Getty Images, and Shutterstock. When companies, brands, and websites use this copyrighted image for advertising and commercial purposes, you will receive a corresponding amount. Beautiful, tasteful photos are also the basis for increasing followers on Instagram, creating your own brand and making money from links and sponsorships. It’s up to you to choose an impressive niche or “lifestyle” that you want to capture in your photos. DIY/ Handicrafts Making handmade items is a potential area in the list of money-making hobbies that you can refer to.  If you like to be creative and meticulous, you can make paintings from unique materials, make candles, jewelry, etc. to sell on the market.  Handmade items are often appreciated for their uniqueness and high quality. Not only becoming a “hot” trend for young people but handmade goods are also sought by tourists when coming to a new country. However, making a product by hand takes a lot of effort and time.  Deciding to do business in handmade goods with a larger number of products, you need to invest more. In short, it is not impossible to turn a hobby into making money.  However, that reality will “successfully” or become a “stalemate” depending on your knowledge and preparation.  An hour a day is an effective way to get started that will lead you to results and opportunities to increase your income beyond your expectations.  From today, practice shifting your mindset from loving something to thinking more realistically, setting goals, and keeping a high level of discipline.