2019 is off to full swing and so is everyone’s New Year resolutions! Maybe you are wanting to be healthier, take more time for yourself, learn a new skill, or something completely different. While all of these are fantastic and should definitely be a part of the New Year goals, there is one area that people tend to forget about and that is financial resolutions. One of the best ways to get your finances in order is to improve your bookkeeping skills. If you don’t know where to start, that’s okay. Today we are going over the bookkeeping tips you need for the new year.
Be Prepared to Get Organized
The biggest thing you need to do before starting is to get organized. One of the key fundamentals of bookkeeping is that you need to keep things clean and in their place. This might sound like a total bore, but it's extremely important. Why? Because with bookkeeping comes a lot of numbers, papers, documents, and receipts. It can get a little overwhelming, so the more you get organized, the easier your life is going to be.
Keep Your Personal and Business Finances Separate
We have all heard the phrase “work-life balance.” This doesn’t just apply to separating your work life from your personal life. It applies to separating your work finances from your personal finances too. Just like you have two separate budgets for your business and your personal life, all of your business bookkeeping and your personal bookkeeping need to be kept separate as well. Keeping things separated reduces the risk of confusing your financial records and misinterpreting what finances go where.
Use Bookkeeping Software
Trying to do all of your bookkeeping tasks by hand can be a major pain in the butt and we don’t recommend it. Using software will make your life a whole lot easier and will streamline the bookkeeping process. We suggest software like QuickBooks Online and Track1099. (P.S. our next blog will go over the best bookkeeping tools, so stay tuned!)
Complete a Monthly Audit
Remember how we talked earlier about needing to be organized? A monthly audit will help you do this. While you should be completing all of your necessary bookkeeping tasks as the month progresses, at the end of the month you NEED to double check everything. Set aside time at the end each month to make sure all of your receipts, documents, and finances for that month are correct and where they need to be. It will save you time in the long run for when you have to complete year-end work. A great habit is to do this while reconciling your accounts in QBO each month.
Plan Ahead for Major Expenses, Seasonal Income, and Taxes
Planing ahead of time for is key to keeping your business profitable year-round. Creating a budget will help you manage your cash flow during each season of your business. Try to account for major expenses you will have during the year, any emergencies that may come up, and the taxes you are going to have to pay. No one wants to be scrambling for money they don’t have, especially when it could have been avoided!
Need More Help?
Keeping these simple bookkeeping tips in mind will make your year a whole lot easier. If you want even more tips or help, check out last year’s 3 Business Bookkeeping Tips to Start the New Year Out Fresh or reach out to us through our contact page! We are happy to help.