It’s not a secret that as an entrepreneur you have to wear multiple hats to keep your businesses running smoothly and stay competitive in the market. You need to have a clear vision of what you want to achieve and know how to put your ideas into practice; you have to handle day to day tasks, find the right people for the right job and be a leader for your employees, and most importantly you have to stay on top of your finances.
But what if maths was never your favourite subject in school, and now you’re an adult who’s not that good with numbers trying to run a company? Does that mean that your business is bound to fail? The answer is no. There are many people just like you who’ve never had a love for numbers, and they still managed to succeed in business.
The truth is money management can be a tricky business indeed, even for versed entrepreneurs. So, it’s no surprise you find numbers a bit intimidating. But the good news is you can change all that and become a financially savvy entrepreneur if you put your mind to it. And you don’t have to do it alone. These money management tips can help you overcome your fear of numbers and enhance your financial literacy over time.
Maybe you and maths weren’t on good terms during your school years, but there’s nothing stopping you from turning things around. If there’s something every entrepreneur knows is that you have to keep on learning, and that’s also the case with finances. It’s never too late to expand your financial knowledge and the fact that you now have access to a wide variety of resources that can help you educate yourself should motivate you even more.
You can learn how to plan a business budget, file your taxes, optimise your payroll process, or stay up to date with government initiatives like Making Tax Digital, so you can manage your business finances with ease. All this information and more is just a few clicks away, so it would be a shame not to take advantage of it.
Keep personal and business finances separate
Keeping your private life separate from your professional life also implies keeping your personal and business finances separate. A lot of people mix business and personal banking, especially in the early days of a business, since it might seem simpler in the beginning. But as the business grows, this approach can make things a lot more complicated.
Having separate bank accounts is important because it makes it easier for you to handle your business’ income and expenses, and makes tax time be less of a burden. It also simplifies the process when an audit is required and, technical requirements aside, it also traces an imaginary boundary in your mind, so you don’t risk developing bad financial habits.
Use the right software
Gone are the days when businesses relied on pen and paper to keep track of their finances. We live in a digital world, so it makes sense to switch to digital to stay on top of business finances. And that implies more than keeping digital records of your financial documents.
You also have a range of tools and software at your disposal such as QuickBooks accounting software that can help you streamline your financial process and relieve you of the burden of doing routine tasks manually. This will not only eliminate the risk of human error but will also free up time for you to focus on other aspects of running your business.
Get professional help
Even if you manage to mend your relationship with the numbers and become a financially savvy entrepreneur, at one point your business will grow and you won’t be able to handle your finances on your own, either because you don’t have enough time, or because the financial management of your business has grown too complex.
That’s when you need to consider looking for professional help so you can keep up with all the workload. Think about the tasks that you can outsource or hire a bookkeeper to make sure you’re not missing or messing up important aspects related to your financial records. You’ll have a lot more time on your hands and enjoy peace of mind knowing that someone knowledgeable is in charge of your finances.
Learn from your mistakes
As you’re working to improve your financial knowledge, you’ll surely make a few mistakes along the way. That’s just part of the learning process and you shouldn’t worry too much about it, as long as these errors don’t bring you to the brink of bankruptcy.
The important thing is to view these mistakes as a lesson and an opportunity to perfect your financial management. Slip-ups and errors can point out the shortcomings in your approach and help you identify the areas where you need to work more. So, it’s not a tragedy if you made a poor financial decision, but it would be a disaster if you keep making the same mistakes over and over again.
Look for ways to improve your process
On a similar note, it’s important to keep on improving even after you’ve become confident in your financial management skills. There’s no such thing as a perfect financial system, so there will always be room for improvement.
It’s a good idea to reevaluate the methods and strategies you use to keep your finances in check on a regular basis. Doing this will help you come up with better money management solutions, whether that means updating your software, employing new tools, or expanding your financial management team.
Bottom line is, even if you don’t have a natural inclination for numbers, you can still learn to manage your business finances properly and become a successful entrepreneur.