Running a small business is a lot of work. There are so many things business owners and entrepreneurs need to stay on top of, plan for and be aware of; the to-do list is never done. So, it’s understandable when they make a few mistakes along the way. Some of these financial mistakes are more common than others, but they are easier to avoid when you are aware of them.
Common Financial Mistakes to Avoid
Set your business up for success by watching out for these common small business financial mistakes.
Poor Budgeting
Tracking your expenses and keeping to a budget is crucial to managing your business’s financial health, but easy to overlook. Make sure you are staying on track by regularly comparing your actual expenses to your budget, and don’t forget about annual expenses.
Neglecting Cash Flow Management
Cash is king in the small business sector. As an owner, you should know where every dollar is coming from and where it’s going. It’s essential to understand and utilize the four financial statements.
Failing to Tax Plan
From failing to estimate your quarterly payments to missing out on deductions, a lack of tax planning is a common mistake that could cost you more than you think. Hiring a professional to help with your small business taxes could lower your tax liability, identify deductions and integrate a long-term strategic tax plan so you can keep more of what you earn.
Not Investing Back in Your Business
Whether you are investing in your employees, advertising, or technology, putting money back into your small business can be hard thing for many business owners to do. But it can be the difference between a business that plateaus and one that keeps growing.
Trying To Do It All Yourself
This is pretty much the story of every entrepreneur at some point, but it’s important to know you don’t have to and often can’t do everything on your own. If your small business is going to grow, at some point you are going to have to expand your team. That doesn’t necessarily mean hiring employees. It includes things like consulting with experts or outsourcing some of your tasks, like your taxes or bookkeeping.
Lighten Your Load & Your Mind
Whether you are an entrepreneur ready to turn your side hustle into an actual business, or have a thriving business that needs your full attention, we can help. We are a licensed accounting firm based out of Gallup, New Mexico and provide businesses and individuals in the Albuquerque, Santa Fe and Farmington areas with high-quality, professional accounting, bookkeeping, tax strategies, and financial management solutions. Contact us today for a free consultation.