When you are starting a new business, there are a lot of things that pull at your time and attention. Whatever your priorities are, don’t forget to make finances one of the top priorities. Without money and capital, you aren’t going to get anywhere. Here are a few tips to help you start off right with your business finances.
Do Your Research
When you first came up with your business, you should have come up with a business plan. Hopefully, your business plan included the basic outline for the financial aspect of your business, but you need to complete your research. Figure out how you are going to get the money for your start-up costs and how you are going to make money. You need to know approximately what your monthly expenses will be and how much you are going to charge for your product.
Create a Budget
Once you have done all your research and you have an idea of how much your expenses are going to be, set a budget for your business. It can be tempting to always get the newest and shiniest things for your office, but having a budget will help you avoid overspending and bankrupting your business before you start. It will also help you see how much product you have to push to be solvent at any given time. It’s not a problem to depend on a loan for a little while, but it is a problem to indiscriminately spend it and destroy your company financially.
Open a Separate Bank Account
If you are using your own funds to start your business, it may be tempting to just use your personal bank account, but this is a huge mistake. You need to keep your personal and business finances separate, even when borrowing from yourself. Opening a second bank account allows you to keep your records straight. Just as with your personal account, you want amenities such as mobile banking, electronic check deposit, and 24/7 service.
Keep All Your Records
No matter how insignificant it may seem, keep every financial record, including receipts. You need to get in the habit of tracking all your finances so you can avoid any problems with a financial audit or losing track of your spending. But keeping all that paper can be overwhelming, and it can create a lot of clutter, so most businesses use software to track expenses and income. You can create invoices for your customers and track your business spending with many of these programs, which eliminates the need for overstuffed file cabinets and prevents accidental misplacement of important financial documents.
Don’t Be Afraid to Ask for Help
Just because you are starting your own business doesn’t mean you have to do everything by yourself. Not only is it okay to ask for help, but you also should! If you are struggling with financial aspects or you just want another pair of eyes on it, hire someone to help you out. Part of owning and running a business is learning to delegate tasks to your employees.
The financial aspect of your business can make or break you, so don’t let it sit on the backburner or pretend it doesn’t exist. Making it a priority may require some extra work, but it is worth it in the end.
