This Cash Burn Calculator helps you estimate how long your current budget has until your business flies off the rails.
It looks at your initial investment, monthly expenses, and current average monthly income.
By using this tool on a monthly basis, you can gain valuable insights into your financial situation, allowing you to make critical decisions as to whether you should change directions, double down, or stay the course.
- Enter your total budget or the amount of money you're prepared to spend.
- Enter your initial investment, such as course costs, tools and equipment, coaching, inventory, etc.
- Enter your monthly expenses, including all recurring costs associated with your business. If you have assigned your business a monthly marketing budget, include it here.
- Enter your average monthly income from your business.
- The result will show you how much time you have until your budget runs out.
- Reassess monthly, inputting any changes to your monthly expenditures and revenue.
What You Can Learn
By using this calculator, you will be able to estimate how much runway you have before your budget runs out.
This is extremely important if you're starting a new business with relatively high monthly costs.
For example, you may have reluctantly started a dropshipping or affiliate marketing business that requires advertising to generate traffic.
How much are you willing to spend (or can you spend) before seeing a profit or pulling the plug?
This is the biggest challenge for new online marketers who start with paid traffic. They often learn how to create campaigns while spending significant money on ones that don't work. If their budget is big enough and they have enough time, they can learn.
But initially, they do not yet have the experience to create a profitable campaign to recover their investment.
The learning process burns a hole through their pocket as they test multiple ads, landing pages, email follow-up sequences, audience demographics, etc.
It's like a train headed down a track that ends. Where is your point of no return?
This Cash Burn Calculator will help you gain a clearer understanding of how much time you have before you need to reconsider your strategies. You'll be better informed to make informed decisions about when to push forward, scale back to stretch out your budget, or pivot entirely.