Here we are, smack dab in the middle of the year with the last tax filing behind us and a beautiful long summer in front of us. So why take action today for a tax filing that is way off in the future? The better question is, why not? The summer months are great for tasks that have been on the back burner. Implement and adjust your habits around these five tips by the end of August, and your year-end recordkeeping will be dialed in. No more anxiety about potential tax situations that could show up come January. Ah, what sweet relief that would be.
1. Change Your Habits
Make time to work on your business rather than in your business. No more late-night updates that just apply a Band-Aid to your recordkeeping needs. Try a more proactive approach and less drifting while you wait for the magic bookkeeping fairy. My suggestion: Schedule one-half to one full day each week for business development. If you don’t prioritize taking care of your business, the simple truth is that there eventually won’t be a business.
2. Embrace Being Paperless
What if that anxiety you were experiencing was simply being driven by the amount of paper sitting around your office or on your desk at any given time? Going paperless is as easy as two steps. First, look at and review your current tools. While a shiny new tool is awesome, we often have great tools at our fingertips; we just need to opt-in. Second, pull a few dollars together and invest in a scanner that auto-feeds documents from the top — that means no flatbed scanners. The right tools make any job easier.
3. Make Automation Your Friend
Recordkeeping is the process that collects your business bookkeeping items and uses data entry to record that activity in your accounting tool. Learn how to use your tool(s) or work with a consultant to find a new tool that will streamline this process. Embrace technology!
4. Get Support and Outsource
Yes, you can do your own recordkeeping. But here is the key question: Is doing recordkeeping your strength and the best use of your time? For most of the business owners I work with, the answer is no. If this is true for you, then outsourcing data entry will immediately reduce the anxiety about your recordkeeping.
5. Create a Plan
Planning doesn’t happen only once or twice a year. Profitable businesses review their plan monthly. I use the Profit First system for cash flow planning and management. Change your priority around handling cash by putting the emphasis on paying yourself first; second, tax savings; third, profit reserve for the business; and then your expenses.
Finally, adjust your mindset to see the opportunities that are around you and focus less on the negative consequences. Connect with us to schedule a consult for creating the action steps required to make the change you desire a reality.
Connie Vanderzanden is a member of the DailyWorth Connect program. Read more about the program here.