The biggest problem I come across with people in business is the amount of bank accounts that they have. This makes things difficult to manage and know where everything is at. If you have the bear amount of accounts required this makes know where you finances are at much easier. A simple example.
Business A
Business bank account
Business savings account
All income goes into the Business bank account and from that account all expenses for the business (I stress for the business) comes out of that account. Then make sure you have a budget, every week transfer money for tax, vehicle registration, business insurances etc. All the things that you don't pay every week into the Business savings account.
This way you are covering your expenses as they fall due, the savings account should be a high interest account so you earn money on the money you have stored during the time. Earning money and paying tax isn't a bad thing. Also transfer an amount every week for your wage, this way the money left in the business account is there for future growth and if you have a bad week then there is money left to cover this.
I know what you thinking that's not always this simple. Well actually it is, you just have to work at it to get rid of the credit cards, the extra accounts that you just move money around in all the time.
This is one thing that we at Dynamic Accounting Solutions help with, organising your business to run effectively and efficiently. www.dasolutions.com.au or info@dasolutions.com.au
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