Money Matters: How to Systematize Everything from Invoicing To Tax Preparation
Hereās an all-too-common scenario: A seemingly successful coach (or service provider) is hard at work growing her business. Sheās working lots of hours, and her hourly rate is respectable. But her cash flow is dismal.
Why?
Because sheās working so hard that finding the time to actually take control of her money is impossible.
Invoices donāt get sent on time. Past due balances are ignored. Taxes arenāt done. And maybe worst of all, sheās got dozens of recurring payments that go out automatically each and every month, and she has no idea what they are or if sheās even using the programs sheās paying for.
Sound familiar? Sadly, thatās exactly what a lot of āsuccessfulā businesses look like. When you work at home, and youāre accountable to no one but yourself, itās far too easy to let these little things slide until, like an avalanche, they have a devastating effect on your business.
The good news is, cleaning it up is easy, when you take the time to put some trusted systems in place.
Start with your billing. Sign up for (and use) a system such as Freshbooks or Harvest, which will automate your timekeeping and produce an invoice with a single click of a button. Then put your billing day on your calendar as an unbreakable appointment.
Log into your timekeeping app, generate your invoices, and click send. Youāll be done in a jiffy. Not only that, but most billing systems automatically send follow-up messages for unpaid invoices, so you donāt have to worry about tracking down those slow pays.
For your expenses, use a single system. That might be PayPal or a dedicated credit card or even your business checking account. Whatever it is, be sure it has a reporting feature that will allow you to send monthly statements to your accountant. At the end of every month, bundle that up with your sales report and your receipts, and send it off. When tax time rolls around, youāll be sitting back with your feet up while everyone else scrambles to find documents and update their accounting system.
If you do your own taxes (kudos to you!) then look for tools that will talk to each other easily. For example, you can download a Quickbooks file right from PayPal for super-fast reconciliation at the end of every month. That alone will save you hours of ādoing the books.ā
Just putting these two simple systems in place can easily save you 10+ hours per month, but the even larger benefit is that the money work will get done. And what that will do for your cash flow is priceless.