Are you an entrepreneur who has worked hard to build your dream into a successful business? It takes a lot of sacrifice to run a small business, but the satisfaction you feel when your business grows is worth all of the effort.
It’s crucial to manage your business expenses, and to make sure your personal finances are kept separate and as healthy as your business’s. Here are a few tips for maintaining separation between your personal and small business finances, and keeping both in good shape:
Accurately Tracking Income and Expenses
As a small business owner, you are tracking every single expense you make, along with every dollar you bring in. That’s why it’s important to keep your personal and business accounts separate so that you can track all your finances accurately. Expenses may start merging, resulting in inaccuracies in both your personal and business budgets. Although it may seem more convenient, in the end, it can become more confusing and difficult to follow.
Prepare for Tax Season
Keeping your accounts separate will also make things easier come tax time. As a business owner, you incur various expenses throughout the year that are considered tax write-offs. Tax laws are frequently changing, and it’s worthwhile to simplify your finances so that reporting is clear and accurate.
Relatedly, make sure you keep all receipts and detailed records of your business expenses. If you misplace a receipt from your personal account, you won’t have to worry that it’ll affect your business reporting later on.
Set Up Automated Bill Payments
The last thing you want to worry about with your business (and at home as well), is making sure you pay bills on time. Setting up automated bill payments can help ensure payments are made on time, and it’s one less thing for you to think about when managing your venture’s finances.
Stay aware of what is being paid and when by setting up an alert system before the payment goes through. This will allow you to review the bill beforehand (while reminding you to look at your account).
Get Insurance for Your Business and Life
If you don’t already have life insurance, now is the time to consider it. Life insurance can provide financial support for your family, including coverage of funeral costs and replacing the income that would be lost if you passed away. Life insurance can also help fund your business in the event you pass away suddenly. With all that you have built and worked for, life insurance offers important protections, not to mention confidence in your family’s financial future for you.
Talk with a trusted insurance agent to see what type of policy works for you and your business. There are multiple types of policies available, and an insurance professional can help you find the right policy to complement your financial plans.
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