The year 2020 is just about to end, and a new year awaits. This year could not conclude much faster for many of us, as it has been quite troublesome for pretty much everyone. If your business is still up and running, congrats! Not many have survived this year, and because you are still here, you have put plenty of time and effort into ensuring that you and your employees always have work to do.

That said, as a small service business, you may not have spent much time focusing on budgeting or financing as much, maybe because you are not making any investments or are not planning to grow.

However, this year has taught us that emergencies can happen anytime, anywhere, and being prepared is the difference between survival and death. As such, to ensure your small service business yet another year, knowing how to budget is vital!

Here are our tips to help you budget for your small service business in 2021.

1. Stay flexible, not rigid

Being able to adapt to different situations is vital for your business to stay afloat no matter what is happening. However, when you commit to long-term deals, this becomes hard to do.

For example, you may have opted for a 2-year contract to use a piece of software to enjoy a particular discount. However, something happens a few months down the line that leaves you financially strapped. In many cases, you will not be able to afford the deal anymore.

As such, while you are sacrificing a few of your finances going for short-term contracts, you become much more flexible. This can come in various forms, such as opting for co-working spaces, all of which allow you to leave the deal as soon as you do not need them anymore.

 2. Build your emergency funds

Having an emergency fund at the ready will never hurt. They are a great way to curtail any emergency costs that may have popped up.

As we have said earlier, anything can happen, and having these funds at the ready will save you financially. That said, if you have not started creating an emergency fund yet, start right away.

How much you put in the fund can be virtually any amount, from the cost-reductions you have made so far to monthly obligations. Also, do not forget to fill in the missing amount once you spend the emergency fund to ensure there is money left.

3. Get affordable financing now

A business loan is always a good-to-have, even if you are doing great as a business. In fact, the best time to get one is when you are financially sound, as you have the money to pay back the loan. Plus, banks and other lenders like to work with financially strong businesses, not one that is on the verge of going down the drain.

With that in mind, consider the various financing options out there, from business credit card to line of credit. These types of funding do not require to be taken out until you need them, and applying for them now means that you can enjoy great interest rates that will save you money down the line.


Staying financially sound is one of the most important activities you must ever consider as a small service business.

With all sorts of factors affecting you, from the ever-changing face of technology to the always-adapting trends of consumers, having the money needed to facilitate these changes will keep you up and running.

With all of that said, keep the tips we have shared with you in your heart. They will guide you through 2021, helping you budget like a pro to ensure your business can face any financial challenges that may show up.

A4E offers expert bookkeeping and taxes to help small businesses control their finances and grow. If you are looking for accountants for entrepreneurs in Boston for your small service business, contact us today and see how we can help.