Avoid Financial Mistakes In Business

 

You
started a business that has been a dream of yours for years. You did your
homework and what you sell is in demand. Fast forward fifteen months, things
aren’t good. You haven’t turned a profit yet since opening the business. You
can’t afford to pay taxes due. The phone never stops ringing from creditors who
want payment. Your stress and anxiety are at an all-time high. How did this
happen? First-time business owners can make devastating financial mistakes.
Here are a few things you can do to help your business.

1.     Be
Realistic About Profits 

Steady money doesn’t
happen within a short amount of time when you open a business. It takes time to
build a stable income much, less a profit. Be aware of this as you plan to pay
your bills. Conduct a break-even analysis so you will have a good idea when you will start making a
profit.

2.     Keep
Your Personal and Business Funds Separate

Don’t mix your personal
and business funds. The best practice is to keep these two funds separate for
tax purposes. Mixing the two won’t give you a real idea of how your business is
doing financially. If you seek out a business loan, it will be nearly
impossible to show what your business is doing.

3.     Not
Keeping Up With Bookkeeping

Bookkeeping isn’t fun but,
you have to do it. Make sure you carve out time each week to update your
bookkeeping. Use tools like QuickBooks to set yourself up for success. Don’t
know how to use QuickBooks? Don’t worry SWVA Tax & Accounting can help you.

4.     Plan
Your Taxes

You have to pay taxes as
a business owner there, is no escaping it. Put funds aside to pay taxes to
local, state, and federal governments. SWVA Tax & Accounting can help you develop a
plan for tax payments.

5.     Get
An Accountant

A good accountant will
save you time and money. Working with one can help with payroll, preparing
financial statements, and understanding the latest tax laws. Look no further
than SWVA Tax & Accounting for all your business tax needs!

6.     Hire
A Lawyer

A lawyer can help you get
your business registered and structured that benefits you. They can review any
contracts and other business documents you have.

7.     Have
A Business Emergency Fund

Having a liquid source of
cash can help cover business expenses for three to six months. This emergency
fund can help keep your business stay afloat during difficult times.

8.     Business
Insurance Is A Must

Business insurance helps
fill the gap of things you didn’t see as accidents or theft. This is especially
important if you are a sole prop since you will be 100% responsible for what
happened. Get it and have peace of mind.

9.     Handling
Business Debt

Business owners often go
into debt operating a business, such as credit cards or business loans. Have a
financial plan to pay debts off so you don’t drown in debt.

Mistakes
cost business owners time and money, two things there is never enough of.
Working with an accountant can make your business stronger. SWVA Tax & Accounting is a full-serve accounting firm specializing in the needs of small businesses.
Call us today at 540-250-3198 or book an appointment today. We’ll run the numbers, while you run
the business. 

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