You’ve got a brilliant idea for a new business. You’re drafting sketches of your product, seeking funding, and looking for the perfect storefront. While that’s all incredibly exciting, there are also other, less glamorous aspects of being an entrepreneur. One such aspect is the complex financials. For new business owners and even industry veterans, there are always ways to make business financials a little easier.
Preparing for tax time
Especially if you’re a newer entrepreneur, you may not be aware that it’s highly advisable to file your taxes each financial quarter. “Wait,” you’re asking, “I thought taxes only got filed once a year?” For the average citizen, they do. However, if you’re self-employed or a single business owner, you may not have taxes traditionally removed from your income like a conventional employee does.
To avoid all of your unpaid taxes adding up throughout the financial year, paying your estimated business taxes each quarter saves you a lot of trouble come tax season. It also will spare you from having to make a major lump payment of all of the money you owe to the IRS. If you’re unsure of how to file quarterly taxes, contact a financial adviser to learn more about the process and how it benefits you as an entrepreneur.
A crash course in accounting
If you’re one of those passionate business owners who started with an idea but not much accounting know-how, this is where you’re going to face a bit of a learning curve. If you don’t understand common terminology, keeping up with your finances is going to be a lot more difficult than you might anticipate. For example, if terms like gross revenue, profit margins, and break even points don’t ring any bells, you might want to consider investing in an accounting course or two.
Even if you won’t be directly responsible for your business’s accounting terms, taking the time to learn and understand them is important if you don’t want to be left out of the loop during key financial discussions. It’s a great way to make sure you have your finger on the pulse of your business at all times. While you don’t need to be trained as a financial analyst to achieve business success, picking up the basics will benefit you in the long run.
Consider some outsourcing
If you’re a smaller business in which it wouldn’t make sense to have an in-house accountant, you may need to consider less conventional methods of handling your company’s finances. One method that’s only growing in popularity is the use of outsourced companies. No, this doesn’t necessarily mean a call center overseas. Instead, you’re likely outsourcing to a business that is dedicated to handling some of your financial responsibilities in your stead.
For example, a lot of business owners choose to outsource payment processing services because it’s one of the more complex aspects of running a store that comes with many questions. What payment methods should you honor? How do you go about paying your employees? Are you managing your accounts payable information correctly? An outsourced company is able to handle all of those questions for you, giving you more peace of mind.
Get in the know
Even if you’re running the smallest of small businesses and don’t anticipate having crazy sales volumes, it’s a good idea to become more involved in the financial side of your company. Not only will you be more informed on how to better grow and develop your business, but you’ll pick up some financial know-how along that way. That’s truly an entrepreneurial win-win.