Small Business Bookkeeping Basics

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Small Business Bookkeeping Basics

When you start a small business, it’s likely you have a particular passion or skill that you want to share with others. Unless you’re equally skilled in finances and bookkeeping, you might find yourself struggling to keep your accounts organised.

Thankfully, there are a few things you can do to keep your books organised and to stay above water so you won’t feel so overwhelmed when you start to go over your finances. Let’s take a look at a few of those basic tips. By putting them in place now, you can set up your bookkeeping experience in a more positive and productive way.

Record Everything

Many small businesses make the mistakes of ‘letting things go’. You might think that a small purchase here and there won’t add up, or that it isn’t important. A good rule of thumb is to get a receipt for anything and everything that is purchased through the business, no matter how small it may be.

This is an especially helpful practice when you’re just getting your business off the ground. You might be buying supplies left and right. It’s important to keep everything recorded so your books will be accurate. Thankfully, technology has made it easier than ever to keep track of your purchases. If you’re unable to keep track of physical receipts, there are apps, scanners, and software programs that can do the work for you.

Don’t Mix Personal Accounts With Business

If you own your small business, you might think it’s okay to mix some of your personal finances with your business accounts. Even if all of that money is yours, you’re just asking for a lot of confusion by combining the two. That means keeping two separate accounts and not dipping into one for the other. Don’t make payments in your personal life from your business account, and don’t feel as though you have to drain your personal account to credit the business.

If you simply worked for a company, you wouldn’t have access to two accounts. If it helps to think of things that way, then develop that mindset. Not only can mixing accounts be confusing, but if you start dipping into your business account, you could be doing something illegal.

Some businesses benefit from having multiple accounts for different things. For example, you might have one account for your services and goods, one for your rent and utilities, etc.

Always Backup Your Records

Again, technology has made it easier than ever to always have a backup of your records. If you’re not taking advantage of that, you could be putting yourself at risk. Don’t just assume your records are safe and secure from any technical error or even a cybercriminal threat. While keeping everything digitally stored is a great way to stay organized, you need to make sure everything is backed up, as well.

With the risk of data breaches at an all-time high, not having everything backed up means you could lose all of your financial records, which could be catastrophic for your business.

Don’t Let Bookkeeping Be an Afterthought

When it comes to bookkeeping for your small business, it can start to feel overwhelming if you don’t know where to begin. If you have too much on your plate to handle, the things you are less experienced in will likely be the first to get ignored.

Bookkeeping is often one of those things. But, ignoring your finances can lead to a big headache when you’re trying to handle taxes or look up purchases. As a business owner, it will end up falling back on you if you aren’t aware of what’s going on in your accounts. Understandably, that can be a lot of pressure when you’re already in charge of everything else.

That’s why so many businesses turn to other companies and services to handle their bookkeeping and to keep them organised.

If you’re struggling to keep up with your bookkeeping or you just don’t understand it as well as you should, don’t put your finances at risk. The Bookkeeper Hub can help you with anything from training to actually taking care of your bookkeeping needs for you. We understand that small business owners have better things to do, so we are happy to share our services with you – because it’s what we do best!

Don’t let your bookkeeping become an afterthought or something that causes extra, unneeded stress. Feel free to contact us for more information on how we can help you to keep your finances in order, so you can focus on other aspects of your business.