You probably remember from grade school that April showers bring May flowers, but did you also realize that April taxes can also bring spring spending? That can be good or bad. Even in your business, you may tend to think of a tax refund as free money, when it is only the government returning to you your own money (of which they took too much. Knowing tax laws and the other ins and outs of financial management can help keep you and your money better acquainted. Because April is National Financial Literacy Month, there’s no time like the present to start understanding some of the most basic ideas that keep your business further away from the red. Here are a few good ones to know:
Spend Less/Keep More
It may seem like common sense, but sometimes common sense flies out the window when we dream big. There’s always a bottom line, and in the case of your budget, it had better be black. This means you may need to wait a little longer to make a big purchase, even if you think it will yield enormous dividends. See the fruit before you invest.
Know the Basics of Taxes
Your home taxes and business taxes are not the same. There are more complicated laws surrounding your business, but that doesn’t mean you can ignore them. Knowing what will be taxed on your business’s income (and what you can write off!) will affect your budget. Don’t forget to take these expenditures into account.
Be Prepared
Like every good boy scout, you need to consider anything that could go wrong. Thankfully, if you invest in the right insurance, the company will have thought of those possibilities for you. Theft happens. Fires are always a possibility. A pandemic? Well, now we know, don’t we? Get covered, and it shouldn’t wreck your business.
Manage Debt
Chances are you had to start your business with a loan. Because that loan incurs interest, it is in YOUR best interest to get rid of it as fast as possible. Interest is nothing more than the extra money you are paying for nothing. Ever wonder why bankers are so well-off? Interest, baby. It adds up.
Even a simple financial understanding of keeping more money in your pocket can lead to an overall better financial place, both at home and at work. However, if you want to master the intricacies of your company’s money management for a better grasp on the way things work as well as to gain financial literacy, consider hiring an expert to work with you. With outsourced accounting services, you can have someone take care of all your payroll, accounting, and QuickBooks needs. Give Debitda a call and see what we can do to help.
