Cash is tight in my business. I'm not getting rich so spending wisely isn't an option, it's a must, or I will be on the street looking for another job. When I decide to spend I have to look for value and a good return on investment.
Obviously some spending can be considered unnecessary while other expenses are needed in order to run the business.
Making smart decisions on where the dollars go is a good habit to get into no matter the financial situation.
My wife and I took a financial course several years ago. There were many positive takeaways from the event but one thing that stood out was managing money.
The idea is 'you tell the money where to go' and not get caught in the common traps of spending without planning! Basically it's all about a budget. Once you setup the budget it brings clarity to the amount of money earned and more importantly decide where it is best spent based on one's financial situation and debt.
Over the years I've grown more cautious about spending money.
There are times when I'm at the store picking up things for the business. It's so easy to toss items in the basket that aren't on the 'need list'. Of course I know this isn't the right way to spend money because it's an impulsive buy. I didn't intend to purchase that item when I left the house. I usually to get far before I put the cart in reverse and place the item back on the shelf.
Then there are convenience expenditures.
Once in a while I come across a service that makes sense for my situation. I know I can live without it but the idea of having it would save me time, headache and money.
These can be difficult to decide on because on one hand I have to shell out more cash. On the other that money will help me in areas of my business that need it!
There have been times where I purchased a service, or product, and it didn't really benefit my business in the way I envisioned it. Then there are decisions that rocked! The investment delivered more than I had originally thought.
Why Self-Employed Quickbooks (QB) is the best decision I've made for the business.
There's no better money spent on my business than the $17 every month I pay for QB accounting software. It's truly amazing the amount of work the product can do on it's own once rules are set-up.
The time-saving key to QB is that you can connect your bank account. Once your account is connected it will automatically import transactions. Not only past transactions but it will import new ones as they happen every day. All this happens while you sleep and work!
I login at the end of the month and know that behind the scenes my income and expenses have been taken care of even-though I didn't lift a finger.
That's money well spent! The only thing I manually insert is images of my receipts. I attached them to the appropriate expense and I'm done. And once the images are attached to an expense I can toss the receipts. The IRS accepts photos as proof for expenses so no need to keep them once they're recorded.
Rules are the key to making the software powerful.
It takes about ten minutes max every month to reconcile my transactions! That's because QB has an amazing feature called 'rules'. I alluded to this earlier but here's how it works.
I have certain vendors and companies that I do business with regularly. I can tell QB how to categorize them once a new transaction from that vendor shows up again. This is awesome because now I don't have to edit each transaction manually. I create a rule one time and QB will automatically apply the appropriate income, or expense category to the item.
For example I pay Adobe $9.99 every month for Photoshop software. That's twelve times a year that expense is logged in my bank account statements.
I set up a rule one time that states every transaction you see that includes 'Adobe' to automatically categorize that as an 'app service' which is an expense/deduction.
Of course there are many other situations where rules are used. About 95% of my transactions are all recorded with the 'rule' feature. There are always a few transactions that need to be recorded but it takes a few minutes and I'm done.
Now I can sit back and let the software do the work once I create the rule.
End of the year tax filing is a breeze!
At the end of the year my taxes are essentially done. Plus my QB membership includes Turbo Tax so I can click a few buttons and it will walk me, and my wife, through all the steps for filing online. It takes maybe an hour each year. That's huge!
Plus it's a stress reliever knowing that I have a virtual accountant keeping my records organized and in compliance with current IRS regulations.
Check i out for yourself!
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