do your own taxes

by Garrett Baird, President and CEO of The Neat Company

When you find a way to earn a living from what you love or what you’re good at, you are happy, fulfilled, and living your best life. That is, right up until it’s time to do the accounting.

No matter what kind of professional or small business owner you are, you’ve eventually got to keep track of the money — what you’re getting paid and what you’re paying out. And while accounting shows you where your money goes, it’s not why you went into business.

Here are things you can do as a young entrepreneur to make it less about accounting and more about what you do:

Make Your Accounting Accountable to You.

First and foremost, whether you’ve got a side hustle or a new startup, you need to be sure you know whether you’re profitable. Profit is what’s left after your products or services are delivered and your vendors are paid. There are accounting terms to know — like what an asset is and what a liability is — but concentrate on the things most relevant to you. By the time you need to know about advanced concepts like weighted-average accumulated expenditures on self-constructed assets, you’ll be hiring people with advanced degrees to account for your money. Until then, look for an accounting platform that speaks your language.

Make Your Accounting Easy.

Keeping books will eat your time up like few things can. Yes, it’s a snap to just toss all your receipts and bank statements in a box to deal with later, but then “later” arrives and you’ve got no idea why half of that paper wound up in that box. A cloud-based accounting platform gives you the power of organization. It keeps everything in one place, making it easy to scan your documents, categorize them, and review when at your desk or while you are on the go.

Make Your Accounting Tell a Story.

As an entrepreneur, you’ll too often think about accounting solely in terms of income taxes. But to fund the things you want to do in life, you’re going to want to make a plan that moves you from “once upon a time” to “happily ever after.” Accounting reports based on accurate, up-to-date information can do that. For example, a profit-and-loss report can lay out trends in revenue and expenses that indicate how you can improve overall profitability. Your balance sheet gives you a look at how your business is changing over time, especially whether you’re susceptible to bankruptcy (bad) or you’ve got cash that can be reinvested to grow the business or to buy something for yourself (good). These reports also enable you to determine how your plot unfolds along the way. Can you hire additional staff, and will it pay off? Do you have expenses that can be reduced?

Make Your Accounting Your Key to Confident Decision-Making.

Having current, and accurate information makes your decisions easier and creates less stress. Find an accounting platform that turns your receipts, bank statements, invoices, and bills into digital, searchable documents and automatically matches them with your banking data. It will catch errors like double billing, and make tax preparation easier. You’ll find that when you have your business finances all buttoned up, you can think strategically. You can make good decisions about prospecting for new work and expanding your services. Don’t be overwhelmed and intimidated by accounting, the lingo or the numbers. Then you’ll be empowered to do what’s needed, capitalize on new opportunities, and even get a good night’s sleep. Confidence will make you happy.

Make Your Accounting Your Cool Friend.

In real life, a cool friend is always there for you, does what you want to do, and brings pizza and beer when you need it. Your cool friend will do a favor just because you asked. Your cool friend will even tell you when you’re making a mistake. Think of a cloud-based accounting platform the same way. Call on it anytime. With all of the data easily entered and reconciled conveniently, you’ll be ready whenever you need to apply for a loan, or (perish forbid) you’re audited. Cloud-based accounting provides the most relevant reports when you need them with the tap of a key. And, like a cool friend, you can make plans with it.

When you approach accounting with the above in mind, good things, like feeling in control of finances and making good decisions, happen.

 

Garrett Baird is President and CEO of The Neat Company. He joined the company in 2020 to lead its entrance into the digital accounting space, helping small business owners spend more time growing their businesses while transforming mundane bookkeeping into actionable insights. Prior to Neat, Garrett was Founder & CEO of Walletron, as well as led channel sales and product management for Collections Marketing Center (CMC).

 

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