When it comes to advice for small business owners, especially those just starting, I always promote a solid accounting foundation. If you establish effective accounting processes and procedures, your entire business has the opportunity to flourish. Whether you’re working part-time from your home office, you’re about to hire your first employee, or you’ve been at this for years, make sure to lay the groundwork with these two pieces of fundamental accounting advice.
Two pieces of advice that I give a lot…
1. Open a business bank account. Then run all of your income and business expenses through that account. Get a business credit card as well if you need one. And likewise, run all of your credit card expenses through that. Avoid commingling your business account and your personal account- keep them separate. If you’re a sole proprietor, pay yourself every other week. Transfer that money and use that in your personal account to pay for personal expenses. This is so important in simplifying your life and business operations.
2. Get accounting system software. There are free ones out there like Wave. And you could probably even use Dave Ramsey’s Every Dollar. Although, that’s more for family budgeting. There are also some paid ones like Xero.com. The one I recommend, and for which I am an advisor, is Quickbooks, especially Quickbooks Online. It has a monthly subscription but comes with all the bells and whistles- all that you need to ensure everything is adequately recorded. Quickbooks hooks right up to your bank account and credit card, making your life much simpler and your business more efficient.
Building a solid accounting foundation is vital, whether your new to business ownership or you’ve been at this for a while. So make sure to implement these two essential tips for a thriving business! And for all of your accounting needs, do not hesitate to reach out to us at Prospect Financial. We’re experts in helping small businesses like yours flourish