Top Three Bookkeeping Tips
There are so many different tips on the basics of book keeping for new business owners, it’s hard to figure out what’s good, what’s bad, and what’s not worth your time looking. Let me help: these are our top three basic bookkeeping tips, and they’re all important for different reasons.
1. Keep Your Business and your Personal Separate
If you haven’t done this already, then you need to set up a separate checking and savings accounts specifically for your business. Many new business owners don’t realize how important this really is, and how much of a difference it’s going to make.
If you’re doing your own book keeping, as your interest in this suggests, you probably think that the entire idea of keeping your personal records separate from your business records is just going to give you one big headache. But trust me, it’s going to save you time. When you go to gather all of your information at the end of the year for tax purposes, having everything separate right from the start will make the entire process run smoother.
Signing up for online banking, as well as getting a paper statement every month, can save you time. It’s very safe to check and bank online, and you can do things like pay bills and look over statements with a few clicks. While you should always have paper information, too, going online makes the processes of banking more efficient
As a personal recommendation, having your personal accounts in a completely different bank then your business accounts can be easier. You always know what statement you’re looking at, and you don’t have to worry about confusing things. While this is obviously your choice, it can make things easier.
2. Find a Good Software
Do your really want to spend all the time it takes to manually write out your bookkeeping? Most people don’t – using a computer software program specifically for bookkeeping can make your life a lot easier.
There are a lot of great programs out there, but for your business, there are a few that I can tell you from personal experience that won’t help – MS Money being one of them. While it’s a great program for personal finances, it doesn’t do well with handling a business.
One mistake some businesses make is going with Quicken, which is oversimplified. While it’s an alright program if you’re doing your personal finances, or if you’re keeping things small, as you grow, it won’t be a good program to grow with you.
3. EIN is your Friend
Getting a federal tax identification number, or an Employer Identification number, is a great safety precaution, and something most small businesses don’t think about. It doesn’t matter if you have an employee, or plan on hiring one anytime soon.
If you don’t have one, you have to use your personal SSN for all of your business matters – and having that number just laying around isn’t a good thing at all. An EIN number protects you and your family.
Applying is easy. The fastest way is to go online and apply through the IRS. It’s easy, won’t take you very much time, and can save you a fortune.
Let KJ Accounting and Consulting Group help you with your accounting and bookkeeping needs. Whether you want us to help you set up your books or you prefer to have us as your trusted expert to do it all for you, KJ Accounting and Consulting is your answer and solution to your needs. We have set up My Simple Accounting as your one-stop resource for our consulting services and training.
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