You may not realise it, but working from home can put extra strain on your finances. There are temptations in the home environment that would not be there if you were working in an office. These temptations can lead to overspending which can put you in a difficult situation should an emergency occur. It’s also more difficult to access financial help, such as a loan from a direct lender, when emergencies happen, if you are self-employed.
This is why it’s so important that you recognise the temptations and make sure that you avoid them. It’s also important to understand UK tax rules so that you know what expenses you can claim. This can remove some of the financial pressure that you might feel and help you to put money aside to deal with emergencies.
Resist the temptation of food excess
You may not think that eating could be a significant issue when it comes to your finances. However, it can create problems for some people. When you work from home it can be very tempting to snack throughout the day. After all, you are only a few feet away from your kitchen and you are free to eat whenever you choose.
The problem is that eating in this way can seriously deplete your food supplies. This means that you can soon find that your food bills rise significantly. In order to stop this from happening, you should treat home working in exactly the same way as you would treat working in an office.
If you worked for an employer, you would not make several daily trips to the kitchen to make yourself a snack. So, you should not do this when working from home. Restrict, your eating to lunchtime when you should take a complete break away from your work in order to relax. Not only does this save you money, it also helps to keep you healthy and creates a more efficient work routine.
Avoid spending during breaks
It’s important to take breaks when you work from home, and not be tempted to simply work continuously from morning until evening. However, you need to pay attention to what you do during your breaks.
If you work using a computer or laptop, it can be tempting to do some web surfing while you are not working. This is often a bad idea, as there is a significant likelihood that you will find something that you want to buy. This type of casual purchasing can end up costing you a lot of money in the long term.
Instead of surfing the web during your work break, why not spend some time reading a book or going for a walk. This is a healthier option as it gives you time to relax and reduce your stress levels.
Know what expenses you can claim for tax purposes
One of the best ways to protect your finances when you are self-employed is to understand what expenses you can claim on your tax returns.
There is a simplified calculation that you can use regarding expenses such as electricity. You can also work out how much you can claim for expenses such as Internet and telephone usage. Having this understanding can save you a significant amount of money.
There are plenty of advantages to working from home, but you can end up spending more money if you are not careful. You need to make sure that you manage your spending in the right way and that you claim all relevant expenses on your tax returns.