If you’re a small business owner, whether you’ve only been in operation for 6 months, or you’ve been around for many years, good bookkeeping is foundational to your success. Staying clear and organized can free up your energy to invest in your growth, it can prevent mistakes, and it can give tremendous peace of mind. Too many entrepreneurs lose track of paperwork and finances, leaving them scrambling, especially come tax time.
Good bookkeeping is essential to maintaining a thriving Fort Collins business. Here are five tips to shore up your accounting practices:
1. Keep business and personal separate
This can be easier said than done, especially for sole proprietors, but it is critical that you keep your personal and business income and expenses separate. Open up a separate business bank account, linked with its own debit or credit cards, and resist the urge to move money around to cover costs!
2. Organize your records
It might sound obvious, but make files for all of your important documents. This includes paper copies if you still use them, but certainly digital as well. Make separate sections for things like licenses and regulatory paperwork, tax documents, employee files, financial records, and more. Clearly name/label your digital files for easy access.
3. Digitize your payroll
Bring your company into this century, and make things easier on yourself with a digital payroll service. You will be able to clearly see all of your employees, their pay rates, their benefits, their tax withholdings, and other vital information, along with knowing that they’re getting paid correctly and on time.
4. Plan for major expenses
In the world of small business and the self-employed, being able to plan ahead is key. Don’t scrape by each month, hoping to be ready to handle large expenses down the road. Plan ahead for major costs like taxes, inventory, repairs, and other business maintenance; work these things into your monthly budgets, so you’re always prepared.
5. Work with an accountant
Oftentimes, business owners find that a qualified accountant is worth their weight in gold, especially when tax season rolls around. If you’re struggling to maintain good bookkeeping, need help maximizing your investments, or need guidance on growing your company, find a local CPA to help you. They can end up saving you significant money, and headaches, in the long run.
Want to talk with a qualified financial consultant about your small business? Reach out to us at Steven J. Wick & Associates today.