So many entrepreneurs start online businesses but don’t take the time to understand their business finances or to create a system to keep them organized, which often leads to overwhelm, wasted time,… and even failed businesses.
And, when tax season rolls around (as it does, every year…), they’re scrambling to remember all their purchases, find the receipts, and put everything together in a neat and tidy package for their accountant.
This doesn’t have to be you. Don’t let bookkeeping scare you! With the right system, bookkeeping can be fairly easy to maintain as a small business owner.
You may not be ready to jump in and hire a bookkeeper to work for you, so how can you do your own bookkeeping in just a few minutes per week with a simple system and free tools?
In this article, I’ll walk you through three important reasons to keep up on your bookkeeping and share a simple system and strategy you can use in your own business so that you can confidently use your financial report as a standard for growth.
The last thing you want to think about is the backend finances of your business because you’re more interested in the creation and marketing process.
But, if you’re interested in growing your business to five figures and beyond , then establishing quality bookkeeping practices to keep your finances in order is essential. It is way easier to do a little bookkeeping every day or week than to try and do it all at once at the end of the month or worse – at the end of the year.
What happens when you need to find something quickly, but it’s missing? You scramble to find it, your stress levels heighten, and tension builds. That’s what can happen when your books aren’t kept up adequately. Unorganized financials lead to missed deadlines or small errors that may go unnoticed but could actually make a big difference.
No matter how small or large your business is, you really can’t afford to make mistakes in your bookkeeping. Act as if. Do you want a large business? Treat your books and organization like you’re already there. Then, as your business grows, that system will grow with you and the team you bring on.
Having a system, keeping it organized, and maintaining the finances will help you in the long run.
If you’re not immersed in the financial side of your business, it will be harder to verify if you’re meeting the targets you set for yourself. The profit and loss statement is a great tool for setting new goals based on where you’re at and the projected growth you desire.
Seeing where your expenses incur helps you determine if you need to adjust anywhere you’re spending, whether it’s to cut out a piece of software or to hire some additional help. Wise decisions can’t be made without seeing the whole picture.
Let’s face it, we don’t like paying taxes, but it’s a reality we share. What if you could organize your finances in such a way that you are able to leverage your expenses so that you can pay less in taxes?
A perk of being a small business owner is that you open yourself up to being able to write off most expenses you incur. When your income and expenses are tracked well, it’s easier to be able to find the places you can take deductions.
