If you’re looking to start a small Business this year, listen up!  Starting a small business doesn’t always seem too complicated, but there are a lot of things that I believe you should consider before starting.  You should know that by “consider”, I mean, look really deeply into.  One of those things is small business accounting.

Below are a few basic things you should do to get started in small business accounting.  Some of these may seem obvious, but it’s surprising how few people do all of them:

  1)   Open/set up a separate account. 

If you’re going into business for yourself, you should really open up a separate spending account.  Keeping your personal and business expenses separate will really simplify things, and is well worth the effort!  Imagine how much easier filing your taxes will be when you can look at ONE account and see the profits and expenses there.  It’s also a good way to ensure that you’re not putting your personal finances on the line for the business.

2)  Determine and STICK TO your starting Budget BEFORE starting

It can be so easy to set a budget for starting up your business, and then other expenses that you weren’t planning on come along, and you spend more than you have set aside.  This is a very easy trap to fall into, and suddenly you’re spending more money than you have, and you’re not making enough to pay for it.  Set a budget, make sure you have those funds to start, and then stick with that budget until you have more money to put into your venture.

3)   Research, research, research

Do NOT throw your money into a business that you have not thoroughly examined.  You need to know what you’re signing up for, so to speak, before you start spending.  Don’t jump into something because your emotions tell you to.  I myself have jumped into things because I was super excited for the possibilities in the moment, and I’ve also done it when I’ve felt desperate to make a change.  Both of those are bad reasons to invest.

4)  Get the right tools to help you.

Lastly, make sure that you are using the tools available to you in your accounting.  You don’t have to do this all on your own!  There are a lot of different spreadsheets out there that can help.  There are programs out there.  Xero has great accounting software, and they offer a free trial.  Look for and take advantage of the tools available!

These are just a few of the things you should do when doing your small business accounting.  If you take the time to do it right, things will go much more smoothly!

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