Are you a freelancer who loathes dealing with your finances? Have no fear! Follow these six steps and financial bliss will surely follow...
1. It ain’t personal- Get a business bank account and run every purchase through it. Don’t use your personal account for business and vice versa. It will make tracking so much easier.
2. Find a method and stick to it- It doesn’t matter if you use a simple spreadsheet or fancy software. Just find a method of tracking your assets, income and expenses and stick to it. Update it often to see trends and at the end of the year doing your taxes will be so much easier.
3. Collect-Send invoices out each month on the same day. Put a big dollar sign on your calendar if you have to remind yourself. If you are using an accounting program, you can set it up to send out invoices. If you are still creating old school Word Invoices make sure that your clients know that you would like to get paid and if they don’t pay, remind them. Everyone has a million things on their plate, so don’t assume they are purposely withholding funds. Be nice but firm.
4. Keep your receipts- Unless the IRS shuts down its doors tomorrow, you have to hold on to your receipts for at least 7 years. So, take advantage of free/low cost storage via Google Drive or Dropbox, invest in a cheapo scanner (or snap pics with your smart phone) and start saving your receipts. If the IRS ever comes a’knocking then you will have proof readily available.
5. Back it up- Do you enjoy spending hours rebuilding your accounting spreadsheets or program? I didn’t think so. Spend five minutes a week backing up your information. You. Are. Welcome.
6. Money Honey- Here is the rule, if it doesn’t make you money, then you shouldn’t be doing it. Spend time on things that bring in the bacon and find people to outsource the things you don’t love. Hate tracking your finances? Hire a bookkeeper. I happen to know a great one.
Ethics doesn't seem like a sexy word. For some, it means to have an incredible amount of self discipline, and self discipline takes work. However, what if I told you that by cultivating an ethical life and an ethical business, you could attract and retain more clients? It's true!
When we know we are doing the right thing for our clients, we are happier and we shine. When we shine, we are more attractive for our clients and they look forward to working with us. When we have doubt about how fairly and ethically we are treating our clients, it shows. No one wants a snake oil salesman; we like working with people who have our best interests in mind.
Ethical companies are stronger, last longer and have clients that evangelize on their behalf. When we run our business ethically, we have a stronger sense of commitment to our clients and they see it in our work. We also tend to make less risky decisions, ultimately affecting our clients. Instead of putting our immediate needs (like cashflow) first, we take a long term approach to our business. This will put us ahead of the pack and when the shortsighted companies, out to make a quick buck, fall away; the strong and ethical companies will be left standing.
So while many don't think Ethics are sexy, I beg to differ. Ethical companies are hot.
So what is our commitment to our clients?
We are radically ethical. We will always be honest, open and transparent.
We are brutally honest. If we don't know something or make a mistake, we will own up to it.
We have crazy consideration. We are on your team and will always consider your needs.
Are you looking for an ethical bookkeeping company? Give us a holler; we are ready to show you what we are made of.
Our Guest Blogger today is Eric Matthews, owner of That Bookkeeper, based in Albert, Canada. He is a bookkeeper, tax preparer, small business consultant, husband, dad, music junkie, and all around tech enthusiast. He started working as a bookkeeper when he was 14, and has been doing it in one form or another ever since. He has worked with a wide range of clients; such as retail owners, service contractors, web designers, and mechanics. We are glad that he was kind enough to do a Guest Blog on our site.
Drowning in Choices
One of the great things the internet has given us is choice.
One of the worst things the internet has given us...is choice.
Instead of limiting ourselves to the two department stores our small town had to offer us as kids, we now have the world at our disposal. On the other hand, we would have taken a long time to finish our shopping if those department stores had 400 different versions of everything we needed.
Both of these extremes are very true in the world of bookkeeping.
Not long ago, if you were starting up a small business, you could pick between 2-3 accounting applications, which would run on the dusty computer in your back office. And, for the most part, it did the job.
Fast forward to today, and you've got 3 web apps for every specialized industry you can imagine. Does your business sell vegan paperclips, but only on the 3rd Tuesday of every month? Someone out there probably made a bookkeeping app just for you.
So, what is an entrepreneur to do? Should you just close your eyes and point at a random link on the screen? Probably not. My advice might take a bit longer, but will produce much better results.
Talk to a professional.
People who do bookkeeping and accounting every day know the industry. They also work with a wide range of people and businesses. Their expertise will allow them to do one of two things.
Recommend the best product for your situation - If you plan to do your own bookkeeping, they can help you find the right suite of applications for your situation. That might mean software running on that dusty computer, or it might mean running your business from your smartphone.
Take the work off your hands - An even better solution would be to stop worrying about bookkeeping entirely. After all, you didn't want to be an entrepreneur because of all the fun paperwork, did you? Unless you're a bookkeeper, then the answer is probably no. All the time you would have spent choosing, setting up, and working with new software could have been used to grow your new business.
With all the choices available to you, the best decision is to start with someone who can guide you, and who has your best interests in mind. Since you're reading this here, it looks like you've already made that first step.