What makes working for yourself exciting is that you are the boss person, with the responsibility of steering your own ship to success. However, amidst all the excitement and thrill of product development, marketing, customer service, and bookkeeping services lies a very important element which can easily be thrown overboard; finance.
This is definitely one area where you should not worry as an entrepreneur. With this definitive guide, you will have what it takes to win on your finance goals and get your business on a path of financial clarity.
The Power of Bookkeeping
Imagine trying to navigate the open sea without a compass or a map. Running a business without proper bookkeeping feels like that. Small business accounting bookkeeping consists of recording all the transactions undertaken in your business, classifying them into suitable categories and then bringing out financial reports which will shed light on your financial perception.
Why Bookkeeping is Essential for Small Businesses:
- Informed Decision Making: Through bookkeeping data, you can make intelligent decisions about pricing, inventory, staffing or investments.
- Tax Preparation: Accurate bookkeeping streamlines tax season thus saving time money as well as potential headaches.
- Access to Funding: When considering loans or lines of credit, financial institutions depend upon solid bookkeeping practices.
Bookkeeping Options for Small Businesses
I will now guide you into the various alternatives that can be adopted by small businesses concerning bookkeeping:
- Do-It-Yourself (DIY): If you’re a mathematical genius and have sufficient time, utilizing online tools to do your own bookkeeping may help you save. However, it demands commitment and solid understanding of basic bookkeeping principles.
- Part-Time Bookkeepers: This is a good option for businesses which require regular accounting assistance but do not need full-time staff.
- Outsourced Bookkeepers: By outsourcing your books, this enables you to focus on your core activities while knowing that finances are being handled by experts.
Bookkeeping Prices For Small Business
The cost of keeping books varies based on the size and complexity of your business, level of service needed and experience with the bookkeeper. Here’s how they generally breakdown:
- Hourly rates: $20 – $50 per hour
- Monthly packages: $500 – $2,500 per month
Finding Local Bookkeeping Services For Small Business Near Me
Are you looking for local bookkeepers? Let me share some tips with you.
- Online directories: Check out online directories such as “Yelp” or “Google My Business” for accounting and finance companies near me.
- Industry Associations: Some industry associations have member directories that may be containing bookkeeping professionals.
- Word-of-Mouth: Ask other small entrepreneurs for advice about bookkeeping services.
Definance, the key to financial freedom
At Definance, we understand the unique challenges faced by small business owners and we strive to provide them with a wide array of accounting solutions so they can concentrate on more important business tasks.
Don’t let bookkeeping distract you from your entrepreneurial journey; instead take charge of your money and open all doors for success in your enterprise.
Consult us at no cost and discuss how our services can help you overcome the challenge of managing your finances!
Frequently Asked Questions
Can’t I just use a spreadsheet for my accounting?
Spreadsheets may perform well when it comes to rudimentary bookkeeping but are prone to errors and don’t offer the features present in dedicated accounting, budgeting and forecasting tools which save time and accuracy in the long run.
How much risk is too much risk for my investments?
Unfortunately, there’s no one-size-fits-all answer to how much risk is “too much” for your investments. It depends on several factors unique to you and your financial situation. Here’s what to consider:
- How much are you at ease with prospective losses?
- What amount of financial loss can you take before your lifestyle or financial goals are threatened?
- How long do you plan to hold your investments?
- What are you saving or investing for?
How do I diversify my investments?
This is a fundamental principle that every investor should embrace, it’s like putting all eggs in one basket! Spread your investments across different asset classes and sectors. Thereby, investors can decrease the overall risk exposure while increasing the stability of their portfolios.
For more information about how to diversify your investment visit our website.
How do I minimize tax on my inheritance when I inherit assets?
While you can’t directly control the tax implications of an inheritance you haven’t received yet, there are some strategies the person leaving you the inheritance can consider to minimize the tax burden on you. Here are a few options:
- The person leaving the inheritance can give you monetary gifts up to a certain amount (currently $18,000 per person per year in the US) without incurring gift tax.
- They may also obtain life insurance covers under which you will be named as a beneficiary.
- Typically the policy death benefit is not subject to tax and this means that you will receive a tax-free inheritance.
- This can be done by giving some portion of their estate to charity thus decreasing the amount of taxable inheritance you inherit.
