Posted on: December 11th, 2022
It’s exciting, your about to trek a milestone that will define your life and the ones you love most. Most people go through life working hourly for someone else for their money, then go home and spend it all. You are one of the few who has decided to take what you have earned and pursue your dreams.
You’re going down a path that few will tred, the road is very rough due to lack of use. But you’re determined to push yourself through, to make the changes necessary.
So here’s a toast to your dreams.
I’m asked the question a lot, what is bookkeeping and why do I need it. Can’t I just throw money into the account and my revenue will pay for it? Well, the answer to that question is yes you could and then hope and pray that your expenses will get paid for.
From my experience, you can always outspend your revenue. There is always that next big shiny object that some salesman has convinced you that your business can’t do without. If you know how much it was actually eating your revenue, you might reconsider that shiny object.
Here is another case scenario, your going about running your business because you love it and then you go home thinking about what a great job you did and all the friends you helped along the way. Then here comes a big company that you buy your supplies from, they accidently charge you twice.
Now being the big business they are, they don’t have the time to kindly tell you that they charged you twice. Because your not keeping an eye on your finances, this mistake slips through your fingers. Your small company is being drained of its money and your sleeping well because you served your customers. Do you see the irony here?
There is nothing worse than at the end of the year feeling that the government has taken more of your hard earned money and leaving you with nothing. Then you hear from someone who heard from someone that you could of taken a tax deduction on that. Well it doesn’t help hearing after the fact.
There is a list of deductions that the IRS has on their publications that show you what you can deduct. If you use these in the beginning to classify your transactions, you will know how much you can deduct. You could even see how much money your getting a tax deduction on each month, which gets you ahead of the game.
Loans can be costly and if you can do without it, I would highly recommend it. I also understand that there are businesses where the equipment is very expensive but necessary for it to run.
When a loan is needed, having well-kept books gives lenders or investors a clear idea of your business’s current financial state and allows them to make financial projections about your company’s ability to pay off your loan. In other words, if your books are well-kept, you look like a rockstar to the loan companies.
If you have gotten this far in reading, I want to commend you, you are a rockstar business owner. You will do what it takes, whatever the changes you need to do, whatever the lessons you need to learn.
Lets face it, bookkeeping isn’t everyone’s cup of tea and sometimes it takes our attention away from what really makes us money. Bookkeeping doesn’t make you money, however, with accurate data, you can make better decisions that could potentially make you more money and that is what you want.
If you have gotten to the point where you’re making enough money to afford a professional bookkeeper, let me know. I can take that extra plate off your workload.
You can contact me at [email protected] or call 509-818-0335
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