How to Keep Up With Your Business Finances

When running a business, it can be incredibly difficult to understand your finances. However, keeping up with your business’s finances is of the utmost importance and should be one of your main priorities while running a business.

Although it can be easy to lose control of your finances, there are many ways in which you can be sure that you are able to track your expenditure, understand your taxes, and know your profits, some of which are explained below.

  1. Hire an Accountant

One of the most profitable steps that you can take if you struggle to understand your finances is to hire an accountant. Accountants can deal with all your finances for you, and prepare you for the tax year. Not only this, but chartered accountants such as Howlader & Co build a professional relationship with you that can help you to get the most out of your business financially and ensure that your business can be tax efficient. This helps businesses to ensure that they are paying the right taxes, know how much profit they are making, and organize their finances accordingly, taking away the stress of dealing with the complicated tax system alone.

  1. Understand Your Taxes

However, if you plan to control your business finances alone, you should first ensure that you understand your taxes as a business. Unlike during employment, when taxes are taken straight out of your payslip, running a business means that you have to maintain an understanding and submit your own taxes.

Income tax is based on the earnings of your business, and so calculating this is the first step to understanding how taxes work. However, there are many more implications which you need to consider, and these can affect how much tax you should pay.

  1. Track Your Expenses

To ensure that you are ready for the tax year, you should track your expenditure throughout the year. This will not only help you when it comes to submitting tax forms but also means that you will know how much money you have to spend and invest. The best ways to track your expenses include using apps and spreadsheet templates to create simple and yet effective methods of tracking your expenditure.

  1. Project Your Revenue

Not only this but when it comes to understanding your business finances, it can also be helpful to project your revenue. This will help you to adapt your business plan to the amount of money that you have available to spend, and will help you to prepare for any obstacles – or profits – you have in the future, allowing you to invest in your business accordingly.

  1. Write Invoices on Time

Writing invoices and sending these to your clients on time will ensure that you receive payment as soon as possible, reducing the number of outstanding payments that you have. You should establish a timeframe for payment in your invoice template, as this will give you a reference point so that you know when you will be receiving money and ensure that your money is not outstanding for long. If you have not received payment within a week, then you should ensure that you follow up on these invoices.

Checkout Unique Finance and get a bonus from me.

8 Things Small Business Owners Need to Know About Finance

Managing Finances for A Small Business

Figuring out how to manage finances is one of the most challenging things you’ll face as a small business owner. Often, people get into the business world because they have an exciting idea or product to share. The chances are that you won’t have a lot of experience with accounts, taxes and cash flow too.

While learning as much as you can about money matters can seem like an exhausting process at first, it’s something you can’t afford to overlook when you start bringing your company to life. Knowing these 8 simple things about finance will help to keep your organization on track.

1. Sometimes You’re Going to Need a Loan

When you first launch a business, sometimes it’s tempting to try and do everything by yourself. The last thing you want is to be in debt before you’ve ever started making a profit. However, the truth is that most people simply don’t have the capital required to handle the demands of a business without a little support. A loan can be the most useful tool you have when it comes to starting your business, and even overcoming cash flow problems. Just make sure that you compare your options so you can ensure you’re getting the best interest rates.

2. Have a Billing Strategy

No matter how good you are at staying on top of things like cashflow, there’s nothing to say that your clients will be just as efficient. Most companies will have at least one customer that always seems to be late when paying their bills. Too much cash tied up in your unpaid invoices can quickly lead to cash flow problems. With that in mind, it’s important to make sure that you have a billing strategy in place. The good news is that there are tools online you can use to automatically invoice clients and send them reminders when they’re late.

3. You Need to Pay Yourself

When you’re running a small business for the first time, you might find yourself trying to put everything you earn back into the company. Any extra capital is a great way to help your business grow, but you also need to look after yourself and your family too. Remember that you’re playing an important role in your company, and you deserve to get paid for your work. Don’t focus on everyone else and forget to look after yourself.

4. You Need to Spend Money to Make It

This phrase might sound like a cliché at first, but it’s true. If you want to make real progress in any industry, then you need to be willing to invest in yourself and your business. With that in mind, make sure that you take risks from time to time, and invest in your growth. This could mean that you need to take an extra loan out at some point so you can afford to buy additional equipment, materials, or pay for staff, but a good risk analysis will help you to see if it’s worth it in the long-term.

5. You Must Remember to Look at ROI

Speaking of investing in the long-term, it’s a good idea to have a way to track your return on investments. Every time you start pouring money into projects for your business, make sure that you set up a measurement system that will show you which of your strategies are good for your future, and which might not be worth the effort.

6. You Need to Constantly Monitor Your Books

Monitoring your books might be an obvious task for financial health in your business, but it’s something that people often forget that they need to do regularly. If you’re the kind of person who might leave managing cash flow to the end of the month, try setting up an hour in your schedule each day where you can look at your incoming and outgoing expenses and make some crucial notes. The last thing you want to do is neglect your accounts.

7. It Helps to Establish Good Habits

Make sure that you do everything you can to develop good financial habits – even if it just means that you block aside some time at the end of each week to check that everything is running smoothly in your business. Running a small business often leaves you strapped for time, but your financials aren’t something you can afford to cut corners on. Start building good habits for your finances now.

8. You May Need Help

Finally, don’t expect to become a professional accountant overnight just because you’ve decided that you want to run your own business. If you don’t know anything about taxes and deductions, and you don’t have time to learn, then invest in an accountant or bookkeeper to help you. You’ll thank yourself for it in the long-term.

 

Checkout Unique Finance and get a bonus from me.

How to improve your personal finances using a checklist

Personal Finance Checklist

Revamping your entire financial plan may seem like a gigantic task, so it’s easy to become overwhelmed. But by breaking your fiscal dreams into smaller, more manageable goals you’ll be setting yourself up for success while gaining some confidence about your money-making decisions with each item you cross off. Making a checklist can by the key to getting your money – and long-term goals – in order. Here are a few examples of simple changes that can make a major impact.

Start small.

One of the biggest mistakes people make when they’re trying to make a substantial change in their life is focusing on objectives that aren’t easily attainable. This is an easy way to sabotage yourself, because the task seems so large you can’t possibly reach it. Think about restructuring your budget in the same way you would expect to start a diet or exercise plan. You wouldn’t expect to be able to run marathons within the first couple of weeks, so why would you hold your finances to a similar standard? Like with most goals, the little things add up. Instead of backlogging every purchase you’ve made in the last six months, start today by tracking all of your extra expenses such as movie nights, eating out, and entertainment-related costs like cable TV or your Netflix subscription. No detail is too small when it comes to money management and financial stability.

Streamline your payments.

Consolidating or organizing all of your bill payments is another simple task to add to your checklist. Determine the bills that you pay regularly, their frequency, amount, and whether or not they can be paid online. If possible, set up all bill payments to withdraw from your bank account automatically and keep track of your email or online confirmations. This can usually be done either through the servicer or your bank. By automating the process, you’ll reduce the amount of time you spend each month gathering paperwork and information. You’ll also simplify your own record keeping, since you should be able to locate most of your payments with just the click of your mouse. Even better, you won’t have to worry about accruing late fees since you know exactly when your account will be debited for each bill cycle.

Pay yourself first.

Having a comfortable savings account is one of the most important steps towards financial security. As part of your monthly, bi-weekly, or even quarterly checklist, send a portion of your paycheck to your savings account each time you get paid. Depending on your personal goals, income, and expenses this amount may vary. However, don’t underestimate how quickly even $10 or $20 per paycheck can add up over time. If possible, set up an automatic deposit so you’ll get used to receiving a lower amount. This is one line item that will give you a bit of satisfaction every time you check it off your list.

Keep your budget balanced.

Keeping your overall budget in order is usually one of the most daunting tasks, but breaking it up into smaller sections will make it a breeze to get through. Make a list of all income sources, everything you spend money on regularly, and for at least one month track all of your expenses to get an idea of how much you should allot for miscellaneous spending. Once you have your list, break the expenses into categories such as utilities, travel, housing, food, insurance, loan payments, and childcare. Your static expenses are those that are consistent for every pay period, and your flexible expenses are the less predictable ones such as car repairs or additional medical costs. Based on what you typically spend per month, you should be able to outline how much is needed to put towards extra expenses on top of your static ones. Being able to check off when each of these obligations are met will give you some peace of mind, and you won’t have to second guess whether you paid that bill or not.

Money Management for Retirement.

Money management is a huge part of most of our lives, and many of us have areas that we’d like to improve. Whether you’re saving for a dream vacation, college, or retirement, keeping track of your goals and when they are met is a valuable tool that you can use for all of your financial plans – no matter how big or small.

Checkout Unique Finance and get a bonus from me.

3 Tips for Accounting Firms Who Want to Remain Relevant

 

Evolution of Technology in Business

The evolution of technology has introduced new fears in the corporate world. Many companies and professionals fear that automation of services will render them irrelevant in the market. The reality is that companies and individuals can now learn how to file their taxes online. Clients can also install accounting apps and programs to keep records and prepare financial reports. However, automation of accounting operations does not mean that accounting firms are redundant. The tips outlined below will help accounting and bookkeeping businesses to remain relevant in an evolving corporate world.

1. Continuous Learning

Firms must invest in continuous learning to remain relevant in a changing environment. Accountants should stay updated with new technologies, trends, programs, and apps in the field. Clients expect accounting firms to use the latest technologies and abide by any new laws in accounting. Hence, managerial teams must ensure that their accountants are exposed to the latest trends in the field. For instance, accounting firms can collaborate with organizations that offer AFSP online courses. Such courses help accountants gain certification, including learning the prevailing rules in filing taxes.

This professional education should also include basic programming languages. The corporate world is evolving towards automated services. Beyond learning the mainstream accounting systems, accountants should learn basic programming languages to handle the systems more efficiently.

2. Flexibility

Change is inevitable in the corporate world. Accounting firms have no control over the speed of change or evolution of technology in the field. The best approach in such an environment is to show flexibility and accept change. One reason why many professionals and corporations become irrelevant is that they insist on the traditional ways of doing things. Many are stuck in one way of handling the accounting function and sell the same to their clients. Accounting firms must encourage their teams to adopt new changes and adjust their strategies as fast as possible. As the firms encourage continuing education, professionals must be willing to implement new skills and knowledge immediately.

3. Maintaining Integrity

Business owners hire accounting firms based on their core values, including their commitment to excellent services. Sometimes firms are slow in adapting to the latest trends especially when the trends involve new technologies. However, clients are patient to work with such firms if the firms can be trusted. Trust is an important component of business relationships. Accounting firms are contracted to handle a sensitive function in organizations. The management depends on financial reports to make decisions. Hence, accounting firms must fulfill their obligations and provide accurate and timely reports. Integrity includes honoring the terms in each contract and delivering every promise to clients.

Conclusion

Accounting firms can remain relevant for decades, despite the continuous changes, if they learn to prepare for change. The management must invest in their team members by offering training and development opportunities. In addition, accountants must learn to adopt new ways of doing things fast, including new systems and programs if they want to stay on top.

 

 

 

Checkout Unique Finance and get a bonus from me.