Making Money is the Easy Part
It’s What You Do Once You’ve Made It That’s Tricky
When you first start your business, there are a million things on your mind.
Unless you already have an accounting bent, tracking your detailed spending and expenses is not one of them.
It’s not that you don’t think about the money. But you think primarily about it coming in–not so much where it’s going after that. You have to focus on the bigger picture to ensure profitability.
And that’s fine. It’s what you need to do. Until it’s time to file your taxes, and the IRS starts asking questions about this expenditure and that write-off.
Mistakes could land you in big trouble and even capsize your business if you aren’t prepared.
Fortunately, you can avoid all that hassle and headache by doing just one thing.
Let Someone Else Handle Your Money
“Don’t let what you cannot do interfere with what you can do.” — John R. Wooden
Having a financial person in your life is one of the best decisions you can make for yourself and your business.
Whether you call them a bookkeeper, an accountant, or a chief financial officer, employing a competent financial manager is an essential part of your business. You must keep track of all of your expenses and have someone who knows what they’re doing in charge of allocating funds.
Counting the Cost
“Many people take no care of their money till they come nearly to the end of it, and others do just the same with their time.” — Johann Wolfgang von Goethe
If you’re an entrepreneur just starting off, the cost of an accountant can feel daunting. But trust me: if you try to get everything in order yourself, the countless hours you will waste is a far greater loss.
Look beyond the initial price. You have to value your time, which is better spent developing your vision, products, marketing, and the things that will move your business forward.
It’s like hiring a bodyguard so you can get on with your job without worrying.
Be smart in who you ask to oversee the finances. Mistakes or sloppy bookkeeping can land you in trouble, and navigating the tax code is a nightmare. Getting audited can be avoided with a competent financial manager at the helm. Their job is to make sure that taxes are filed correctly and that spending choices never raise red flags.
If you want to position yourself for growth rather than disaster, you need someone else running the books.
The Devil is in the Details
“Never hire someone who knows less than you do about what he’s hired to do.” — Malcolm Forbes
When you get a financial manager, they will start looking at how the smallest spending decisions add up.
By breaking down your small expenses, they could help you save thousands of dollars by making just a few changes.
At the start of your career, you might be putting a lot of your own money on the line. These small spending adjustments will enable you to save up and create some breathing room for when you might need a little help.
And while we’re at it, you cannot neglect your personal finances. Keeping track of your own spending and getting help budgeting will change your life.
Consider the classic example: if you buy a $3.50 coffee five days a week, you’re spending $910 on coffee every year. What more could you do if you reduced that spending?
Don’t Be a Financial Loner
“One of the greatest barriers to connection is the cultural importance we place on “going it alone.” Somehow we’ve come to equate success with not needing anyone. Many of us are willing to extend a helping hand, but we’re very reluctant to reach out for help when we need it ourselves. It’s as if we’ve divided the world into “those who offer help” and “those who need help.” The truth is that we are both.” ―Brené Brown
No matter how small your business is, never try to do it all by yourself.
None of my business ventures would have continued to profit without the help of financial managers. These people help me grow my businesses in the most efficient and sustainable way possible.
As an entrepreneur, you’re often looking at the big picture. You need to surround yourself with people who balance your weaknesses, can scale things down, and mind the details.
All great businesses are built by teams. Surround yourself with a well-balanced team, know the value of your time, and pay attention to every dollar you spend!
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