42: Starting Or Updating Your Bookkeeping Mid-Year Whether You Are Starting A Business, You Are Sel
Did you have good intentions on getting your bookkeeping caught up this year? Did you list keeping up with your bookkeeping as one of your goals for 2021? Are you are finding yourself in a mid-year bookkeeping crisis, and you know your bookkeeping needs a little attention or possibly a great deal of attention? If so, this episode will definitely give you some ideas about how you could get your bookkeeping ready to go so that you are able to make smart business decisions for the remainder of the year. If you just started your business in 2021 and you are not sure how to get started with your bookkeeping, you’ll find lots of help in this episode as well. Today I am going to cover some of the best practices when it comes to catching up your bookkeeping as well as what to do if you need to start bookkeeping for your business mid-year. These best practices will apply to you whether you are doing your bookkeeping manually or using an Excel spreadsheet or using a computerized bookkeeping software such as QuickBooks, Xero or Wave. There is no need to put off your bookkeeping until tax season when you will be stressed out and rushed to get everything caught up. With my help today, let’s make this is the year you go into tax season with your bookkeeping information up to date and ready to file your tax return easily. Whether you are just getting ready to start your small business, you’re a solopreneur, entrepreneur, small business owner, virtual online bookkeeper or virtual assistant and you know your bookkeeping needs a little mid-year kick in the pants, listen in to this episode so that you are doing everything you can to have your bookkeeping up to date. Just like the Chinese proverb says, “The best time to plant a tree was 20 years ago, and the second-best time is now”, right now is the best time for you to make sure your get your bookkeeping up to date…
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Show Notes:
Did you have good intentions on getting your bookkeeping caught up this year? Did you list keeping up with your bookkeeping as one of your goals for 2021? Are you are finding yourself in a mid-year bookkeeping crisis, and you know your bookkeeping needs a little attention or possibly a great deal of attention? If so, this episode will definitely give you some ideas about how you could get your bookkeeping ready to go so that you are able to make smart business decisions for the remainder of the year. If you just started your business in 2021 and you are not sure how to get started with your bookkeeping, you’ll find lots of help in this episode as well. Today I am going to cover some of the best practices when it comes to catching up your bookkeeping as well as what to do if you need to start bookkeeping for your business mid-year. These best practices will apply to you whether you are doing your bookkeeping manually or using an Excel spreadsheet or using a computerized bookkeeping software such as QuickBooks, Xero or Wave. There is no need to put off your bookkeeping until tax season when you will be stressed out and rushed to get everything caught up. With my help today, let’s make this is the year you go into tax season with your bookkeeping information up to date and ready to file your tax return easily. Whether you are just getting ready to start your small business, you’re a solopreneur, entrepreneur, small business owner, virtual online bookkeeper or virtual assistant and you know your bookkeeping needs a little mid-year kick in the pants, listen in to this episode so that you are doing everything you can to have your bookkeeping up to date. Just like the Chinese proverb says, “The best time to plant a tree was 20 years ago, and the second-best time is now”, right now is the best time for you to make sure your get your bookkeeping up to date…
Welcome Back…When you own your own business, you can be pulled in multiple directions, and you need to set your priorities so that you know what you need to focus your time on. I totally understand this as a business owner myself, and I know how valuable our time is. With this being said, I want you to know that keeping your bookkeeping up to date for your business should be one of your top priorities. Let’s face it, you know you need to have your bookkeeping done at the very least by the time you need to file your tax return, right? So, why not have your bookkeeping up to date so that you can make smart business decisions throughout the year? Knowing exactly how your business is doing throughout the year and using that data will help you make smart business decisions that helps your business be successful.
Now that one half of the year is over, I want you to take a good look at your bookkeeping. I mean a really good look and be honest with yourself. Do you know there are things you need to catch up on, or did you just start your business this year and you just need to get started but don’t know what you should do first? Doing a mid-year assessment will be beneficial for you to make sure that you end this year with your bookkeeping as up to date as possible.
First, decide which months you need to do your bookkeeping. If you were in business since the beginning of the year, you will need to make sure everything is captured from the beginning of January. If you just started your business this year, you would need to begin with the month you started your business, or whenever you started to accumulate any business income or expenses. The key here is to make sure you are capturing all your income and expenses for the year in one bookkeeping system. You don’t want to have to take part of your manual bookkeeping system and combine it with your computerized bookkeeping system at the end of the year. Keep everything in one place for the full year so that you can easily see how your business is doing and you will have everything ready to go for your tax return. I can imagine you are thinking that you don’t want to go back and record everything from the beginning of the year, but trust me, not only will you be happy you have everything up to date, but you will also get to experience the repetition of recording your transactions which is a great way to learn more about your bookkeeping system as well as how your business is doing.
Next, gather all your bank and credit card statements. If you have a check register, this will be helpful as well. You will also want to make sure you have all your receipts for any expense you are recording for your business. If you are struggling with how to manage your receipts, you can go to episode 34 where I talk about how to manage receipts in your business.
If you have already decided on a system for recording your bookkeeping transactions, or if you have a system you have used in the past and it is working for you, go ahead and continue using that same system. If you are wondering which system will work best for you, there are lots of options. If you have a pretty simple business and not too many transactions, you could always use an Excel spreadsheet to record all of your transactions or you could even record your transactions in a notebook or ledger, but I do recommend using a computerized bookkeeping system such as QuickBooks, Xero or Wave, even if you don’t have a lot of transactions. The reason for this is that your business will continue to grow, and it is nice to get the hang of the system you are using so that when you have more and more transactions, you are familiar with how to record everything, and you have systems in place for when your business transactions increase. Another benefit of using a computerized bookkeeping system is that you will enter each transaction only one time and there are many different ways you can view this transaction in reports with just a simple click. Don’t let a computerized bookkeeping system scare you. I have had lots of clients who have utilized these systems and they are saving time and really end up enjoying the process of recording their transactions.
Once you have your documents and your system figured out, it is as simple as just getting all your information recorded. I would recommend recording all your income and expense transactions for one month and then reconciling your statements and then moving on to the next month. This may mean you need to start with January’s information or if you just started your business this year, you would start with that month. The key here is to just get started. Most business owners will find that they put their bookkeeping off and then it gets behind. Once it is behind, they find excuses to hold off even longer. Don’t let this happen to you. You will find once you get started, it is easy to get the momentum going and work through months of information. Before you know it, you will have everything up to date. Imagine what a great feeling this would be for you. Not only is it a great feeling to be up to date, but knowing you only have to keep up with your current month’s information is such a stress relief.
Reconciling all your business bank and credit card statements will be key to making sure you are capturing all of your income and expenses. I have talked to numerous business owners who think they have all their data recorded but they don’t do a reconciliation to make sure everything is accounted for. This many times can leave out bank service charges or interest, so make sure that you are reconciling all of your accounts. If you are recording your data manually, you can reconcile your accounts just by making sure everything on your bank and credit card statement is recorded. If you are using a computerized bookkeeping system, it is even easier to reconcile your accounts since they have everything set up to just check off after you have entered the transactions.
The middle of the year is a good time to be brutally honest with yourself and decide how you will make sure your bookkeeping is up to date. If you know it is behind and you don’t think you are going to have time to do it yourself, it is time for you to decide if you should find a bookkeeper to help you ensure it is up to date and done correctly. When you have a bookkeeper helping you, all you need to do is to provide your bookkeeper with your bank and credit card statements as well as any other data they would need to keep your books up to date. This can all be done virtually so you don’t need to worry about them coming into your office. Most bookkeepers have their own software which can save you the cost of having to purchase the software on your own, but if you are already using an online bookkeeping system, you will need to grant them access to be able to pick up where you left off. If you are considering outsourcing your bookkeeping, it can be as affordable as $97.00 per month depending on the number of transactions you have. I want you to know that I am here for you if you ever have questions, need help with your bookkeeping or would like more information about how much it would cost to have your bookkeeping done for you. You can contact me by going to https://www.financialadventure.com/Contact-Us. I’ll also post a link where you are listening to this podcast so that you can easily contact me, and don’t forget to grab your free copy of the 5 Essentials For Stress Free Bookkeeping. This guide is helpful whether you are doing your own bookkeeping for your business, or you are doing bookkeeping for multiple businesses by covering the five essentials every business needs to do to have stress free bookkeeping. Grab your free guide by going to https://www.financialadventure.com/5essentials.
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.
