When you're a business owner, you're your own boss and in control of your income. How scary is that? In addition to the excitement of being your own boss, it can be a bit intimidating particularly ...
Don't wait for the due date to pay your taxes because you may not have the funds to pay by then, especially if you're not a good money manager. To avoid this problem, it's a good idea to set aside a portion of every payment you get into a savings count. When you do this, you're going to have the money needed to pay your taxes for the quarter. You never want to be late in paying your taxes and this simple money management strategy will help you avoid paying late because you don't have the funds to make the payment on time. Even if you're the only person running your business, earmark a salary for yourself and then issue yourself a paycheck regularly. This will actually help you organize and manage your business and personal finances better. Here's what you can do: all monies that come in from selling your products or services should be deposited to your business account. Next, decide whether you want to pay yourself on a weekly, bi-weekly, or monthly basis. If you decide on a bi-weekly payout schedule, say every 15th and 30th of the month, simply pay yourself from your business account on those times. You can decide how much you should pay yourself. It can be a percentage of your business income or it can be an hourly rate.
Resist the urge to spend. It is tempting, when you have money coming in, to start spending money on the things that you've wanted for a long time but couldn't afford. You should, however, spend money on things that will benefit your business. Put your money in your business savings account so that if unexpected business expenses come up, you'll have the means to deal with it in a prompt manner. You'll also be able to save money on office supplies if you buy in bulk. When it comes to your business equipment, you will save more by investing in quality machines even if they may require a huge cash outlay from you in the beginning. The savings will come in the form of not having to buy a new one or replace parts frequently. Avoid spending too much on your entertainment as well; be moderate instead.
When it comes to properly managing your business finances, you'll find that there are a lot of things that go into doing so. Managing your money is not a basic skill or easy thing to learn. It's really a complicated process that requires constant learning and practicing, especially by small business owners.
The tips we've shared should help you get started in managing your finances properly. If you want your business to be profitable, you need to stay on top of your finances.
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