What Is It Costing You?
What is it costing you?
Every year, around this time we begin to receive phone calls from people who are seeing the end of the year approaching, and they are beginning to get nervous about that bottom drawer. You know the one. The one with all the receipts and statements (sometimes still unopened) laying in it.
This was the year they were going to make sure they didn’t get to February and panic or have to spend grueling days going through everything at once. This was the year that they were going to work with a bookkeeper but they never got around to it because they were really still questioning if there was enough money to even worry about.
Here is the truth, I will guarantee you if you are not connecting with your numbers on a monthly basis, you are leaving money on the table. And that money is worth worrying about. Let’s face it, you worked for it so you should be the one to keep it.
Without good tracking I see many people losing out on the allowable write offs for business. It is one of the few ways most governments award you for taking the risk of being self employed.
Here are some tips that are easy to follow and you can start using right away so that when tax time rolls around you are all set and ready to go.
- Open the bottom drawer!
Throwing everything into the proverbial shoe box simply creates chaos and leaves this nagging voice in the back of your mind every time you add something to the box – “I need to get this handled”.
For clients who work with us remotely we recommend they put everything into an envelope for the month and then send it to us at the end of the month, or they can keep it in a file labeled for that month and scan it to us. The good news is, it is all in one place and easy to handle and then be done with.
- Label as you go!
As consumers we are typically creatures of habit. Once we know the category a certain expenditure goes in, it is easy to handle. If you are using a new vendor or using a vendor such as Amazon, where you purchase many different types of items then label the receipt with your category right away. Now, when you put it into the folder for that month, you are done with it and it does not require another conversation or thought.
- Online banking
I know in days gone by this was a very scary concept for many people. Today automation saves an incredible amount of time, and security measures allow for a much safer process. For many of our clients we are able to download statements, pay bills automatically, do payroll or send invoicing for them. Saving lots of back and forth emails or phone calls. What is your time worth ?
- Just hire a bookkeeper
Ok, this is a shameless plug, but really, is doing your own bookkeeping the highest and best use of your time? I promise you, you will spend a lot more time on this than we would, and the chance of you making a mess and leaving money on the table is pretty high. We are really good at what we do, and we love it! I know a number of you just shook your heads :). Having current and accurate numbers is critical for running a business and making decisions with confidence instead of emotion.
Money does not come to chaos and if by chance it does, the likely hood of keeping it is pretty small.
- The bottom line – connect with your numbers or leave money on the table.
I know today you are thinking it is a lot more fun to do the thing that you do than it is to look at numbers. My goal is that your numbers are fun for you. Honestly, there is nothing more motivating than watching your profit margins and your bottom line increase. Money touches every area of our life. Start looking at and understanding the story your numbers are telling you. This puts you in the driver’s seat! It is pretty empowering being able to make adjustments along the way and see the results.
Your bookkeeping is the financial pulse of your company. Ready to take a reading? Let us know if we can be of service to you!
PS If you are ready to keep more of the money you make give us a call and let’s get you started right away!