By Anita Ginsburg
Becoming your own boss sounds like a dream come true to many. You finally get to pursue your passion project full-time and enjoy going to work. But in between building your business and networking, you also need to be concerned about organizing your daily transactions. Even if you’re just starting out, keeping an accurate record of your finances is vital to the future and continued success of your small business.
Organize your receipts
Keeping and organizing your transaction receipts is highly recommended for all business owners. Not only does it help you stay on top of things, they are also great for providing proof of the transactions. You never know when you’re going to be audited, so keeping your receipts can help make the process much easier.
On top of keeping all your receipts—both from transactions with suppliers and with your customers—you need them to be organized. Receipts do you no good if you can’t find the ones you need quickly and easily. Organize them chronologically and keep notes on what each receipt represents. You should keep at least the past three years of receipts. Tax, income, and debt documentation should be kept for four to seven years, depending on what they are.
If your business prefers to use digital receipts instead, an app that can store receipts will be essential. You can use apps like Expensify or Freshbooks to maintain an organized record of each and every transaction that goes through.
Hire an accountant
Even with high-tech, automated financial programs, some people are just not good with numbers. This is nothing to be ashamed of, but you may need some extra help. If you fall into that category, hiring someone to perform bookkeeping services is a good idea. An accountant is an excellent choice as their sole obligation is to manage a person’s finances. On top of that, accountants are also responsible for creating and keeping records of financial documents.
Consider opening business financial accounts
Small business owners and freelancers often find themselves frantically searching for business expenses when tax time comes around. Some small business owners combine their business finances with their personal finances. This mainly occurs with people who are new to the business world.
You can avoid the stress and frustration of going through your bank statements by opening business financial accounts. These specialized accounts are solely for your business transactions making them easier to manage. There are a total of three accounts you’ll need to open: a savings account, checking account, and a business credit card.
Use spreadsheets
Spreadsheets are best suited for people who have just started their business. However, even well-known corporations use spreadsheets from time to time. A spreadsheet is a pretty simple way to track your finances, and it’s surprisingly efficient. Google Spreadsheets and Microsoft Excel are two reliable programs to create effective spreadsheets to track your expenses.
As a small business owner, you’ve got a lot on your plate. If you simply can’t keep accurate track of your daily expenses, ask for help. This will give you more time to focus on building your dream.
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Anita Ginsburg is a freelance writer from Denver, CO. She studied at Colorado State University and now enjoys writing about health, business, and family. A mother of two wonderful children, she loves traveling with her family whenever she isn’t writing. You can find her on Twitter @anitaginsburg.
