Insights Blog

Small Business Money Management Tips

Key Takeaways

          • Good money management is essential for success.
          • Consider hiring professionals to help with bookkeeping and taxes.
          • Creating and following a budget helps you stay on track.
          • Watch your cash flow carefully.

      Starting a small business usually begins with a great idea. Maybe you want to capitalize on your family’s secret recipe for amazing cookies, run the best car repair shop in town, or simply be your own boss. Most small business owners excel at their craft, but some may find managing finances challenging. If this sounds familiar, check out these money management tips to help your business thrive beyond the grand opening.

      Focus on what you do best.

      You don’t need to do everything on your own. If you’re great at baking, you might not also be great at managing finances—and that’s okay! A bookkeeper can keep your accounts in good order while you concentrate on what you do best. Likewise, an accountant working on your taxes can help you plan and avoid problems later.

      If you prefer to manage the finances yourself, Autobooks in Lake City Bank Digital makes it simple to send invoices, accept payments and pay bills.

      Keep business and personal finances separate.

      It’s important to have separate accounts for your business and personal money. This makes it easier to track expenses and income, and it helps you avoid using personal funds for business expenses. It can also help avoid tax and audit problems.

      Make a budget.

      Creating a budget doesn’t have to be hard. Start by listing all your expenses, like rent, utilities, and taxes. Then, list your income. Break these numbers down into a monthly plan. If you have big expenses like quarterly taxes, spread out payments to make it easier to manage. Review your budget often and adjust it as things change.

      Plan for growth—and the unknown.

      Set aside money in your budget for future growth, like new equipment or bigger projects. Also, save for unexpected costs, like repairs or slow sales periods. Having savings can help you stay steady.

      Track your cash flow daily.

      Knowing how much money is coming in and going out every day is key to staying on top of things. To keep cash flow strong, try negotiating prices with suppliers or offering customers a small discount for paying quickly. On invoices, be clear about when payment is due, like “net 30 days” for payment within a month.

      Borrow wisely.

      When the time is right, borrowing can help your business grow. Consulting a banker, like the business bankers at Lake City Bank, can help you determine if a loan* will work well for you. A line of credit can also help during slow times, ensuring you have the cash you need. Managing your credit responsibly—from credit cards to loans—keeps your business moving forward.

      Turning your passion into a business is exciting. Make sure your hard work is rewarded by managing the financial side of your business with the same dedication as the creative side.

       

      *All loans are subject to credit approval.