Here are some simple ways to manage your business finances. Putting the system in your business could help you save time and could simplify your business operations.
1. Separate your personal money from your company’s cash
One of the most common mistakes of home-based entrepreneurs is to put their business and financial funds in the same bag. Separating the two will help you monitor your business’s cash flow and help you save and protect your business’s benefits from unplanned expenses.
2. Use the automatic payments option
Automatic debit and automatic payments can help you simplify the payment process for fixed recurring expenses. Setting up automatic payments is not difficult. Most banks are willing to help you set it up. You can even negotiate with your creditors to offer you a lower interest rate when you sign up for this payment option.
3. Keep your bills in a designated place
As soon as the invoices arrive, be sure to keep them in one place. It doesn’t matter which storage compartment you use. It can be a drawer, a box, a vault, an envelope, or a simple file folder. The idea is to create a pattern so that it is automatic on your part to keep those important invoices so you don’t forget it and don’t spend so much time looking for it.
4. Pay your bills on time
How often do you need to pay additional charges due to late payments? Simplify things by allocating funds to pay those business bills on time. You can use Microsoft Outlook to remind you of due date for your bills.
5. Double-check your credit card statements
Take the time to read and verify your credit card statement, to check the interest rate or the wrong entries, and also to take advantage of points and sales. You could pay the annual charge on your credit card.
And yes, you can forgo your annual credit card payment. It only took him a phone call asking his credit card to give up his annual credit card fee. If your spending meets your minimum spending criteria, you can have your credit card for free.
6. Computerize your checkbook
Using a software program is a practical way to organize your finances. Managing your cash inflows using useful software like Quicken, Microsoft Money or other similar cash flow software makes things easier. In addition to having an idea of your business’s cash flow at a glance due to the charts, it will also come in handy when tax season comes.
7. Link your savings to your checking account
This is one way to get overdraft protection. Most banks will be able to link your checking account to your savings, money market, or credit card. In the event of a bad check, you will automatically receive funds from those sources. Both avoid bank charges for bad checks and avoid unnecessary embarrassment.
8. Close unused accounts
Whether it’s a credit card or bank account, call the bank or write a letter asking to close the account. This will simplify things. Apart from that, this will also increase your credit score.
9. Consolidate your accounts
Another way to simplify things is to consolidate multiple outstanding credit card balances into a single credit card. Be sure to do your homework to check the lowest interest rate on your credit card. The smaller the number of accounts you manage, the more time you save. It is easier to monitor your cash flow with smaller accounts.
10. Purge your old financial files
How long do they keep their financial records? A year would be a good rule of thumb, but it can vary from place to place. Better ask your accountants.
Review your files at the end of each year and discard invoices and receipts that are no longer needed for auditing purposes. If you don’t have a good shredder, be sure to cut and burn that confidential confidential information.
You can keep a scanned copy if you really need to do long-term storage.