Good Businesses Keep Good Books

Good Businesses Keep Good Books

So here’s the deal…not one of us who opens a small business does it to do bookkeeping unless of course, you’re actually opening a bookkeeping business. Most of us don’t want to think about it and well… even go to great lengths to avoid it. But you can’t pretend to be running a real business without being involved with the financial part of your business.

Two reasons why you’ve got to do your books is 1) the IRS requires it, and 2) it will boost your chances of success. Check out the chart below.

See how bookkeeping impacts the success of a business? And it’s so true, I see it in my practice constantly. But the good news is, I also see people making the effort to learn their books and get it right, and I’ve seen their businesses take off!

5 Ways to Keep Good Books:

#1. Keep Your Business and Personal Accounts Separate

When starting a small business, most of us use our own funds from our personal accounts, but as soon as you know you have a viable business, open a business account and get either a credit/debit combination card or a credit card. From that time on, use your business cards and accounts for business and your personal cards for personal purchases.

You want to do that because it’s mental, baby! You’ll treat your business seriously. And so will the IRS. If you don’t keep separate accounts, the IRS may classify your business as a hobby and disallow expenses. And then there’s tax time – keeping accounts separate make doing your taxes easier.

#2. Set Up An Accounting System

You’ll need to enter your income and expenses somewhere. Way back in the olden days, this was done with pencil and ledgers. I actually know an old guy who uses a spiral notebook and pen to track his little restaurant. Every day he carefully records what he purchased for the business, what he sold, and what he paid out in labor. It worked for him because he carefully tracked it. I’d never want to change him, but the rest of us? We need accounting software.

Do your research carefully as to which software you select. If you aren’t familiar with what your company needs to best track your business, find an expert to help guide you set it up and train you. It’s worth the money.

#3 Check Your Accounts Daily

Make this part of your daily rolling-out-of-bed routine. Log into your bank and credit card accounts, and review all purchases and credits. You want to check for fraud and to see where your money is going. You’ll be more careful in your spending if you face it daily.

#4 Have a Bookkeeping Routine & Calendar

This is critical. The successful businesses that I work with all have bookkeeping routines. You need to make a firm date each week to do your books, including recording deposits and posting expenses, sorting receipts and filing papers. Make notes on your calendar filing and tax deadlines. Do the same for license and insurance renewals. Here’s a sample of a bookkeeping routine.

Sample Bookkeeping Routine

#5 File Government Forms & Pay Your Taxes on Time

As a small business owner, you’ll likely deal with government agencies at the federal, state, and local level. You are expected to set up reporting and tax accounts.

Tips for taxes:

• Set money aside every month for taxes so it’s not such a big hit to your checking account.

• Get that payment in on time. Late penalties can be from 2% (IRS) to 9% (WA State DOR), and from there they tack on more fees and interest.

• Don’t trust that your bookkeeper will handle all this for you. It’s your responsibility as an owner to know what taxes you have to pay, when they are due and oversee that it gets done.

• Put filing and payment dates on your calendar so you know when they are coming up.

about

Julie Porter

My own boss was created for women entrepreneurs by women entrepreneurs with decades of business experience. We’ll show you that you don’t need a business degree to be successful, and we’ll guide you through those hardest parts of owning a business, by teaching and empowering you to truly own all the pieces of it. And you know what? When you do that, you’ll be able to focus on what you love and do best.

E-mail me at julie@julie-porter.com if you have any questions. I love hearing from you!

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It’s Your Time! Part 2

It’s Your Time! Part 2

Opening a business is one of the exciting things you can do. It’s a wonderful way to take a life rich with experience and create a way to make money from that. We go into business for a variety of reasons, from being the best at something, to inventing a product, filling a gap, being downsized, or wanting to be our own boss (there’s a little bit of that 3-year-old in all of us- right?).

Over the years I’ve helped a lot of start-ups, and I can put the winners and the losers into two categories. The winners are those who engage fully with the start-up process, educating themselves about the ‘business’ side of the business. The losers, well, they pretty much wing it. They figure they’ll ‘handle all that stuff later’ and then never do. So you can have a brilliant person who hits a home run with a product or really cool service, but will still lose at business because they ignore the accounting or don’t put in processes.

1. Research your business idea. Check feasibility, your market, and whether you can make a living at it. Look at websites, marketing, see what the average income for businesses in that industry is. Do you need a special license? Google = your BFF. Being fully armed with information can keep you from making a costly mistake.

2. Talk to people. Talk to people running businesses in your field as well as to your future customer base. They’re a source of information and inspiration. Most people love
to help so don’t be afraid to ask!

3. Write these things out:

• What your company will do
• Who its customers will be
• How you will sell your service or product
• Calculate the cost to produce your service or product & what you will charge
• Business location, staff projections
• Sales strategy and promotional ideas
• Realistic budget
• Realistic sales and net earnings projections

If you write all that out – you’ll have a legit business plan.

4. Decide how you’ll fund your business. Options are business loans, investors, friends & family, crowdfunding or self-funded (bootstrapping). Many businesses start out as a side-gig until it’s proven that a living can be made at it.

I recommend you look into getting your business certified as a woman-owned business by the Women’s Business Enterprise National Council. It can help you qualify for money that’s only for certified businesses. There are also grants and contracts available for women-owned businesses that can help ensure success.

5. Build a solid foundation from the start. Set in writing your standards and the systems you’ll use to ensure the standards are met. Set up a basic accounting system from Day One. Bring in help if you can’t do it on your own.

For a more in-depth list, click here for your Start Up Check List

about

Julie Porter

My own boss was created for women entrepreneurs by women entrepreneurs with decades of business experience. We’ll show you that you don’t need a business degree to be successful, and we’ll guide you through those hardest parts of owning a business, by teaching and empowering you to truly own all the pieces of it. And you know what? When you do that, you’ll be able to focus on what you love and do best.

E-mail me at julie@julie-porter.com if you have any questions. I love hearing from you!

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It’s Your Time! Part 1

It’s Your Time! Part 1

When I met Wendy she was kissing fifty.  Full on lip-lock. And you know what? She didn’t care.  She owned it, radiating gratitude and positivity about the years that had gifted her with wide experience, perspective, and the knowledge that she could do pretty much anything.

After working in several cool occupations, Wendy decided to return to her family roots in the health industry, and in her forties returned to school for the education and certifications she needed.    She spent time working for others and then she had that aha moment where she said, “I could run this business better… I could be my own boss!”

And she did it.  She was excited and nervous about the unknown, but she wasn’t worried about opening a business in her 50’s.  From the first day, we met to set up her business, Wendy has taken her warm personality and strong work ethic and created a niche business with a loyal clientele.

I love it when women over forty, fifty, and sixty + embrace entrepreneurship. We are forced to be reckoned with and built for business.  Here are five reasons why:

1 – We have the unique ability to juggle and multi-task all over the place.  We’ve had multiple roles all our lives and by the time we hit our middle years we absolutely shine at it.

2 – You can’t fake what we have…and that’s experience, baby!  It’s not conceptual to us – we have lived it and know that struggle is part of the process.  With that perspective we know we can’t be broken, we know what’s important, and we know that every tomorrow is a new start.

3 – The middle years bring transition.  Many of us have raised our children or are experiencing changes in relationship status, and those transitions free us (or force us) to channel our energy into work.  They also may inspire us to do something that we’ve always wanted to do… that we alone own. And that can be a precious thing.

4 – We are heart-centered.  We create businesses (no matter the type) that nurture and support our customers or clients.  It’s not about a big score to us, it’s about the thousand ways we improve lives. And then, as if that’s not enough, we turn around and hold up our sisters in business.

Now for some statistics that prove it:

* Women-owned businesses have increased by 4.5 million over the last 11 years
* Women-owned businesses grew 58%, while all businesses increased just 12%
* Nearly half (48%) of women business owners are between the ages of 45 and 65.
* Two-thirds (67%) of women business owners are 45 or older (that means there’s a bunch over 65!)
* Total revenue of women-owned businesses rose by 46%, while revenue for all businesses rose 36%.

If you’re thinking that it’s time for you to take the exhilarating leap into entrepreneurship, just make sure that you build a solid foundation from the start. Wendy brought me in to help her set up her company correctly, establishing systems & practices as well as simple accounting processes. This one thing can make or break a company. Bring in help if you can’t do it on your own. You’ll save money in the long run because clean-up is way more expensive than set-up.

So if you’re in your 40’s, or 50’s… 60’s or 70’s and you want to start a business – do it. You’re sharp, you’re savvy, and you’re ready to tackle new challenges. Show the world how extraordinary you are!

about

Julie Porter

My own boss was created for women entrepreneurs by women entrepreneurs with decades of business experience. We’ll show you that you don’t need a business degree to be successful, and we’ll guide you through those hardest parts of owning a business, by teaching and empowering you to truly own all the pieces of it. And you know what? When you do that, you’ll be able to focus on what you love and do best.

E-mail me at julie@julie-porter.com if you have any questions. I love hearing from you!

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