INSIGHT business coaching
BUSINESS 101: Handling Finances Ten things business owners should know about managing their money
BY JAMES HOLLOWAY
I
n 1996, after the release of the movie “Jerry Maguire,” everyone was walking around saying, “Show me the money.” If someone approached you today and said, “Show me the money,” could you show them where you spend and invest the money your business generates?
As a business owner, especially if you are the sole employee of the company, one of the last things you probably want to do is dive into a spreadsheet or a P&L statement to assess the financial health of your company. Like many people, you probably pull up your online bank account and if there’s money in the bank, it’s a good day. If funds are running low, maybe you think closing one or two more sales will be sufficient. If that is the extent of your money-management plan, you may want to consider adding some or all of the following tasks to your to-do list.
Keep good records
Whether you have a bookkeeper or use accounting software like 20 | wf-vision.com | September + October 2019
QuickBooks, you have to keep the information updated on a daily basis. Use your online banking access to reconcile bank transactions on a daily basis as well (not just when you receive a statement at the end of the month).
Stay on top of billing
Send out invoices as soon as possible. Make sure your clients understand when payments are due and what, if any, penalties there are for late payments. If you do multiple jobs for the same client, use a unique invoice-numbering system so that you can easily identify which jobs have been paid and which jobs may have been missed. Don’t be afraid to follow up and ask about the status of a payment if you do not receive the funds in a timely manner.
Keep your money separated
Have a dedicated checking account for your business and never, ever use business funds for personal expenses. Likewise, avoid using personal funds for business expenses.
