Small businesses often have limited budgets, which can make it difficult to hire professional bookkeepers. However, there are a few simple bookkeeping tips that can help you keep your small business books in order without breaking the bank.
First, make sure you have a system in place for tracking income and expenses. This can be as simple as using a spreadsheet or dedicated bookkeeping software.
Second, stay organized by keeping all of your financial documents in one place. This will make it easier to find information when you need it and prevent important papers from getting lost in the shuffle.
Finally, don’t be afraid to ask for help when you need it. There are many resources available to small businesses. The following tips will help you get started in the right direction.
1. Make a budget and stick to it
One of the most important things you can do for your small business is to create a budget and stick to it. This will help you keep track of your expenses and income so that you can make informed decisions about where to allocate your resources.
If you’re not sure where to start, there are plenty of free online resources that can help you get started, like this one from Nerdwallet.com.
Once you have a budget in place, be sure to review it regularly and make adjustments as needed. This will ensure that your finances are always on track.
2. Keep track of your income and expenses
To keep your finances in order, you need to track your income and expenses. This will help you see where your money is going and where you can cut back.
There are many different ways to do this, but one simple way is to use a spreadsheet or budgeting software.
Another way to track your finances is to use a personal finance app like Mint or Wally. These apps allow you to connect your bank account and credit cards, so they can automatically track your spending. They also offer features like budgeting tools and expense tracking.
No matter how you choose to track your finances, the important thing is that you do it regularly so that your records are always accurate. This will help you stay on top of your spending and make better financial decisions.
3. Reconcile your bank statements regularly
One of the most important bookkeeping tips for small businesses is to reconcile your bank statements regularly.
This will help you catch any errors or discrepancies and keep your financial records accurate.
Make sure to set aside some time each month to review your bank statements and compare them to your own records. If you spot any discrepancies, reach out to your bank or accountant to resolve them.
By staying on top of your finances, you can ensure that your business is running smoothly and avoid any nasty surprises down the line. So don’t forget to add reconciliation to your list of monthly tasks!
4. Use accounting software to make bookkeeping easier
One of the best ways to make bookkeeping easier is to use accounting software. This can help you keep track of your finances and make sure that everything is organized.
There are a lot of different options out there, so be sure to do some research and find the one that works best for you and your business.
Accounting software can save you a lot of time and hassle, so it is definitely worth looking into if you are serious about keeping on top of your finances.
What accounting software do you use for your small business? Share your thoughts in the comments below!
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5. Set up a system for tracking inventory and sales
If you’re selling products, it’s important to keep track of your inventory levels. You can use this information to determine when to order more products so you won’t run out of stock.
You should also track sales so that you can see which products are selling well and adjust your inventory levels accordingly.
Again, there are a number of software programs that can help with this, or you can set up your own system using spreadsheets or pen and paper.
This will give you peace of mind and help you run your business more efficiently.
6. Don't wait until the end of the year to do your taxes - start planning now!
Start planning for your taxes now by keeping good records throughout the year. As mentioned above make sure you have a system for tracking income and expenses and set aside some time each month to reconcile your books.
These simple steps will make tax time much easier – and help you avoid any surprises down the road.
The sooner you start thinking about your taxes, the better off you’ll be. Trust us, tax season is never fun. But if you start planning and organizing early, it can help make the process a lot less stressful.
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Following these simple small business bookkeeping tips can help make tax season a breeze. So get started early and you’ll be thanking yourself come year end!
Do you need help with your bookkeeping? Reach out to us at anytime to get on board. Our skilled bookkeepers can make a real difference in your busy life.