100: Stop Dreading Your Bookkeeping Whether You Are Starting A Business, Self-Employed
- Financial Adventure, LLC
- Sep 7, 2022
- 11 min read
100: Stop Dreading Your Bookkeeping Whether You Are Starting A Business, Self-Employed, A Solopreneur, Entrepreneur, Mompreneur, Business Owner, Side Hustler, Freelancer, Bookkeeper, Virtual Assistant, Or VA
Do you dread working on your bookkeeping for your business? Have you neglected it, and now it seems like a project you’ll never be able to tackle? We all know how essential it is to have accurate and timely financial statements so that you can make sound business decisions, but your bookkeeping doesn’t have to be dreadful. If you take some pretty simple steps, you can change your bookkeeping to be a much easier task that you can handle and have the knowledge and understanding of your business that you need to be successful. In today’s podcast episode, I’ll help you create a process for doing your own bookkeeping that will help you feel less stress and anxiety while eliminating the dread that many business owners feel when they think about bookkeeping for their business. When you decided to start your own business, bookkeeping may not have been the first thing that excited you, and you are not alone. Most business owners are busy running their businesses and don’t take the time to keep up to date with their bookkeeping. Whether you are a self-employed individual, a solopreneur, entrepreneur, mompreneur, freelancer, small business owner, a remote, virtual, online, or in-house bookkeeper, or a virtual assistant or VA, you may be thinking that bookkeeping takes up a lot of time. It’s easy to put off, but if you take some time to implement the steps I mention in this episode, you’ll stop dreading your bookkeeping and find that it is possible to simply make your bookkeeping easy. These tips are essential whether you are using a computerized software system like QuickBooks, Xero, Wave, or FreshBooks for your business finances; or doing your bookkeeping manually with an Excel spreadsheet or even a Google Document…
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Show Notes:
Do you dread working on your bookkeeping for your business? Have you neglected it, and now it seems like a project you’ll never be able to tackle? We all know how essential it is to have accurate and timely financial statements so that you can make sound business decisions, but your bookkeeping doesn’t have to be dreadful. If you take some pretty simple steps, you can change your bookkeeping to be a much easier task that you can handle and have the knowledge and understanding of your business that you need to be successful. In today’s podcast episode, I’ll help you create a process for doing your own bookkeeping that will help you feel less stress and anxiety while eliminating the dread that many business owners feel when they think about bookkeeping for their business. When you decided to start your own business, bookkeeping may not have been the first thing that excited you, and you are not alone. Most business owners are busy running their businesses and don’t take the time to keep up to date with their bookkeeping. Whether you are a self-employed individual, a solopreneur, entrepreneur, mompreneur, freelancer, small business owner, a remote, virtual, online, or in-house bookkeeper, or a virtual assistant or VA, you may be thinking that bookkeeping takes up a lot of time. It’s easy to put off, but if you take some time to implement the steps I mention in this episode, you’ll stop dreading your bookkeeping and find that it is possible to simply make your bookkeeping easy. These tips are essential whether you are using a computerized software system like QuickBooks, Xero, Wave, or FreshBooks for your business finances; or doing your bookkeeping manually with an Excel spreadsheet or even a Google Document…
Welcome Back…Do you feel stressed or anxious when you think about doing your bookkeeping? Do you think that doing the bookkeeping for your business is annoying or frustrating? If so, you are not alone. After all, unless your business is doing bookkeeping for others, and you love working with numbers like I do, you probably have a business providing a product or service other than bookkeeping that lights you up. Your business should get you excited. As the saying goes, if you do what you love, you’ll never work a day in your life. But that doesn’t excuse you from having control and understanding your business finances. This is a crucial part of owning a business. It is an essential part of your business that needs to be done, even if you think it is a waste of time. Did you know that cash flow is one of the major reasons businesses fail? As a business owner, you need to understand and manage your business finances. This means keeping accurate accounting records and having your bookkeeping up to date. When you have your bookkeeping under control, and you are able to utilize your financial statements to make sound business decisions, you are setting your business up for success.
I want to dive a little deeper into why it is so essential for you to be making good business decisions based on your financial statements. Making decisions in your business is hard, even if you don’t have accurate financial information helping you make these decisions. How would you know if you could afford to make a large purchase, spend money on an expense, or if you needed that money for the cash flow to carry on the business? Would you know when and how much additional inventory you need? How would you know how much money you could allocate to an expense such as advertising? Should you hire an employee, and do you have enough cash flow to pay all your bills? What if you would make expensive mistakes like not paying bills or taxes on time which would result in late fees, penalties, and interest? What if you didn’t know who owes you money or customers who are not paying on time? You wouldn’t know who to follow up with or charge late fees. What if you forgot to invoice your customers, and you were giving your work away for free? You could also be paying for expenses that you no longer need or that you’ve stopped using. All of these poor decisions add up and can impact your cash flow. If you don’t have the proper financial information, you are making decisions for your business blindly. As time passes and you don’t keep up with your bookkeeping, it gets harder to find the time to work on this now more significant bookkeeping project or task. The bigger you feel this bookkeeping project gets, the more you will find the feelings of dread building up, and you’ll want to tackle it even less. Just like any other chore, like doing laundry or cleaning the house or garage, if you do it a little at a time, it doesn’t pile up, and it is much easier to keep up with.
Alright, so how can you make your bookkeeping easy and avoid that awful dread feeling? What if bookkeeping was just easy? What if I told you it could be easy? Your mindset will change as you develop processes to make your bookkeeping easy, and you can do this in just four simple steps. The first step is to make sure you have a bookkeeping system that you are comfortable with, are able to use efficiently, and it doesn’t cause you to feel overwhelmed from the start. You could be using a pen and paper method, keeping track of everything manually using an Excel or Google spreadsheet, or a computerized software system like QuickBooks Desktop or QuickBooks Online. Think about the system you are currently using. Are you happy with it? If not, what would you like to utilize instead? Do you understand the system you are using or are you ready to make a switch? You need to make sure that the bookkeeping system you are using is working for you and that you are able to stay current and maintain it. The most highly recommended solution I have for the business owners I work with is QuickBooks Online. There are many different QuickBooks Online solutions available, starting at about $20 per month. If you are interested in learning more about getting QuickBooks Online for your business, you can go to www.FinancialAdventure.com/quickbooks, and you can also receive 30% off your first six months.
The second step is to automate as much of your bookkeeping process as possible. I know this can be harder if you are utilizing a manual bookkeeping system, which is one of the reasons I recommend a software system like QuickBooks Online. With this option, you are able to import bank transactions and easily categorize and enter them into your books with one simple click. This also provides real-time records so that you can see exactly where your business stands financially. Once each transaction is entered, you can view it in many different areas and reports, such as your profit and loss report. You can track your invoices and accounts receivable to ensure you are getting paid from customers on time, and you’ll know exactly which bill payments you need to pay and when they are due. You can easily view your financial statements, which include your balance sheet and profit and loss, with a click of a button and have everything ready to go for tax preparation at the end of the year. This gives you a complete picture of your finances and tells the story of how your business is doing. You can also set up multiple users, including your accountant and/or tax preparer, and each user can access your file anywhere they have an internet connection, making it easy to work on.
The third step is to create processes that save you time as well as a routine that you can stick to. Set aside a regular time to do your bookkeeping. You could choose daily, weekly, bi-weekly, or even on a monthly basis. I do not recommend you wait more than one month to do your bookkeeping, but you need to find a solution that will work best for you. Schedule this time on your calendar to do your bookkeeping, and include other important deadlines as well. Don’t let anything take priority over this time, and don’t put it off. When you procrastinate, it only makes doing your bookkeeping worse, so make it easy on yourself by sticking to your schedule. You may find that by doing a little bookkeeping at a time works best for your schedule. If this is the case and you are utilizing a system like QuickBooks Online, maybe you could go into your bank feeds every day for a few minutes and add each transaction. If you need to schedule a more significant amount of time once a week, you could take care of the same transactions weekly rather than doing them daily. Preparation and organization are going to be key to simplifying your bookkeeping. When you do your bookkeeping on a more frequent basis, it will help you to remember what each transaction is for. Don’t let your bookkeeping pile up. Not only is it harder to get caught up, but you’ll also have a more challenging time remembering what each transaction was for. You want to save yourself time whenever you can by eliminating any unnecessary tasks. One way to do this is to make sure you are keeping your personal and business finances separate. When you do this, you won’t have any additional personal transactions that take you additional time to record. Also, make sure that you don’t complicate things. Keep everything simple, including your chart of accounts. When you keep the categories you need to choose from when you are recording your transactions simple and straightforward, it will make it easier to select which account to use when recording transactions.
Lastly, step four is to reconcile and review your bookkeeping on a monthly basis. You will need to make sure you are reconciling your accounts every month. To do this, have your statements handy, and don’t file them away until you’ve reconciled them. By reconciling and reviewing your financial statements every month, you will be able to find errors sooner, ensure you have all your transactions recorded, and ask questions when you are not familiar with how to record something or if you are having a hard time understanding how you’re your business is doing. You’ll soon have information like which months are your higher sales months or when you need to plan or save your money for slower months. It will help you understand your cash flow and ensure you have consistent and accurate data for making sound business decisions.
If you know that you don’t want to do your own bookkeeping, it is best to realize this sooner than later. Be honest with yourself and hire a bookkeeper to help you. They can save you valuable time so that you can put more effort into running your business. You may find that a bookkeeper could actually save you money. Take some time to figure out what your time is worth and how much time you would spend on your bookkeeping. Once you have this figure, compare it to what you would need to pay a bookkeeper to do your bookkeeping for you. If you do decide to hire a bookkeeper, make sure you are still taking the time to review your financial statements on a monthly basis. If you have questions, ask your bookkeeper or accountant so that you can learn from them as you go.
When your bookkeeping is up to date, just think about how much more satisfying your business will be, as well as the peace of mind you’ll have knowing everything is accurate, and you can make sound business decisions from this data. Having your bookkeeping up to date in this last part of the year will also help you to make good tax decisions and have strategies in place so that you can save money on your taxes. You can see if your net income is higher than the last year, and it would be beneficial for you to include a larger expense you’ve been thinking about making this year. Knowing if this is the best year for you to take that expense could save you some substantial taxes, but if your bookkeeping isn’t up to date, you won’t have this availability to strategize and make good decisions before the end of the year. To help ensure your bookkeeping is up to date and accurate before the end of the year, I am holding a Bookkeeping Bootcamp Workshop for you to attend. I know it can be easy to put your bookkeeping off, and I hope the four steps I mentioned in this podcast help you develop an easy bookkeeping system you can maintain, but if you feel you need additional help, I am here for you. As a CPA, Business Strategist, and Coach, I help business owners just like you to ensure you have up-to-date and accurate financial statements. In this workshop, you’ll have a chance to either get started with your bookkeeping, catch up on your bookkeeping or just make sure you have your bookkeeping system set up properly so that you can make smart business decisions during these last few months of the year. This workshop is great for business owners as well as bookkeepers who want to streamline their procedures as well. I offer workshops like this throughout the year, and you can go to www.FianncialAdventure.com/workshop to sign up for this current Bookkeeping Bootcamp Workshop today. I’ll post links to this and other valuable resources for business owners and bookkeepers where you are listening to this podcast and in the show notes.
And, you know I’m going to ask…what’s at least one thing you will take away from this episode that will help your business succeed and grow your bottom line? If you need some accountability, join our PRIVATE Facebook community and post your action item, we’d love to support you.
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