1 Budget wisely

One of the first steps to financial success as a self-employed mechanic is to create a realistic budget that reflects your income and expenses. A budget can help you control your spending, avoid debt, and save for your goals. To make a budget, you need to estimate your monthly income based on your average number of clients, hours, and rates. Then, you need to list all your fixed and variable expenses, such as rent, utilities, insurance, supplies, gas, repairs, and marketing. You can use a spreadsheet, an app, or a software to track your budget and adjust it as needed.

2 Track your cash flow

Another important financial practice for self-employed mechanics is to track your cash flow, which is the difference between your income and expenses. Tracking your cash flow can help you monitor your profitability, identify opportunities to increase your revenue or reduce your costs, and manage your cash reserves. You can use a simple ledger, a bank statement, or a software to record your cash flow on a daily, weekly, or monthly basis. You should also keep track of your invoices, payments, and receipts, and follow up with any late or missing payments.

3 Save for taxes

As a self-employed mechanic, you are responsible for paying your own taxes, such as income tax, self-employment tax, and sales tax. To avoid any surprises or penalties, you should save for taxes throughout the year, rather than waiting for the tax season. A good rule of thumb is to set aside 25% to 30% of your income for taxes in a separate bank account. You should also keep track of your tax deductions, such as mileage, home office, equipment, and education. You can use a tax calculator, a software, or a professional to estimate your tax liability and file your tax returns.