3 Tricks to Simplify Small Business Finances

When you run a small business, simplification and minimalism are key to success. Unfortunately, finances are one area that can quickly get out of hand if not managed correctly. Apply these three tips to your enterprise to help manage finances with minimal hassle and as simply as possible.

Keep Business and Personal Funds Separate

One of the first things you should do when starting a business is open a separate checking account just for your company. Balancing separate accounts may seem like the opposite of minimal, but it makes managing legal issues, taxes, and income for your business much simpler. Also, if you deposit business checks into your personal account, your personal assets may be compromised if your company runs into financial trouble.

Keep Your Money Organized

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You’ll need to keep your money organized for tax purposes, but the benefits associated with effectively managing your revenue and expenses go far beyond the IRS. Follow these best practices to minimize the difficulty of money management.

Use Business Checks

Using business checks will help you separate your business and personal funds. These are larger than personal checks, which makes writing them easier. Business checks can also be used in a ledger. This streamlines accounting.

Endorse Your Checks

Endorsing business checks is an extra step, but it will help you manage your finances and reduce the risk of fraud. You can endorse a check, for example, to clarify that it’s only payable to your business. Simplify the process by using a stamp, or work with an online check printer to add information such as your business name, restrictions, and any other information that will always be included on the back of your checks.

Use Simple Deposit Slips

Use simple deposit slips to keep money organized and get it into your account efficiently. Like endorsing checks, you can automate this process or order printable deposit slips to make life easier. As a nice bonus, if your accounting software and deposit slips come from the same company, you won’t have to enter the shared financial information twice.

Start Now

Lay the groundwork for effective financial management now. Don’t wait until your business has expanded and money is starting to get complicated. These solutions can all be readily expanded as your business grows, so take steps to put them in place while it’s easiest and most affordable to do so.

Automate and Outsource

There’s a temptation to do as much in-house as possible when running a business. This may seem like the simplest way of doing things, but it can lead to problems if you’re not experienced with accounting. Automating recurring payroll processes and outsourcing to an accountant seasonally for tax purposes will free up time to focus on actually running your business, and it will minimize the likelihood of complications arising due to improper accounting.

Simplicity is key to lowering costs for any enterprise, but for small-business owners, it’s often the only way to keep the company afloat. Try these tips out to better manage your finances while still keeping things simple.

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