You don’t have to be an accountant to master your business finances. You own the business, so you should be able to answer any question about its money — and the good news is that this is a learnable skill, not something reserved for people with an accounting degree.
Nobody expects you to be an accountant just because you’re a business owner. But you do need to understand and manage your finances if you want to succeed. So ask yourself honestly:
- Do you know when your recurring payments hit each month?
- Do you know your net income for last month? For last year?
- Do you have the right tools for your finances?
- Do you have an actual system in place?
Every business owner should be able to answer these — yet in my experience as an auditor, most can’t. You might be brilliant at running a restaurant, writing, or teaching people how to build something. Those are real strengths. But if you never get a handle on your finances, you’re at high risk of failing at some point, because catching up once you’re behind is hard. Usually that catch-up only happens under pressure: taxes are due, you’re being audited, or a lender needs your real numbers. Here’s how to master your business finances without becoming an accountant.
Keep your personal and business expenses separate
It’s tempting to run everything through your personal bank account until the business is bringing in “enough” money to justify a separate one. Don’t.
Open a business bank account from day one. Commingling personal and business expenses is a messy road you don’t want to travel. When it’s time to organize your expenses, how will you know which were business and which were personal? In an audit, if the auditor can’t easily tell, you’ll likely lose those deductions entirely — which means a bigger tax bill, because you couldn’t deduct expenses from your income.
If you want to use a credit card for business, that’s fine — just dedicate it entirely to business and keep a separate card for personal purchases.
Keep everything in one place
We live in a digital age where few records are kept on paper, and that’s okay — as long as you keep an electronic copy of everything related to your finances.
I organize all my business receipts right in my email inbox. At the start of each year I create a new folder named something like “2019 Income and Expenses,” so whenever I need a receipt, I know exactly where to look. The IRS requires you to keep records for a minimum of three years, and seven is recommended — a new folder each year keeps them all accessible.
Prefer paper? Build an organizing system that lets you find anything quickly. The point is simple: the next time you’re tempted to delete a receipt for a business purchase, move it to a folder instead. And if you’re the kind of person with 89,000 unread emails, please — build a folder system for your finances at least. Make your life easier and give yourself a system you’ll actually use.
Build a budget for your business
You might think you don’t need a budget. You do. Just because your bank balance shows money doesn’t mean that money is actually available — it’s likely already earmarked for something.
A budget tells you what expenses are coming and when your recurring payments hit. Many companies offer a discount for paying annually instead of monthly, and plenty of owners take that deal — so a budget lets you plan for that yearly charge instead of a “Surprise! $300 is due today” moment when you have no idea where it’s coming from.
“But I don’t know what I’m selling this month, so how can I budget?” Build your expense budget first, so you know how much you need to bring in. Then plan your income and what you’ll sell. A business never brings in the same amount every month — flush one month, lean the next — which is exactly why a budget matters even more.
Use the right tools for your finances
Several tools can help, but you have to pick the right ones and actually use them. When you’re just starting out, a simple free spreadsheet is perfectly fine — you usually don’t have many line items yet. As you grow, tools like FreshBooks, QuickBooks, and Xero can help; just choose the one that fits how you work.
Other tools that help: taking a course that explains what’s actually included in your business finances, following accounting bloggers who share advice (there are a handful of us out there), or hiring an accountant so your questions get answered. You don’t have to be an accountant to handle your finances like a rockstar — but you do have to understand them.
Make regular dates with your books
Yes, a date with your books — and a recurring one. You don’t have to do it daily. My recommendation is once a week: make it the first thing you do Friday morning, before you create any content or hop on client calls.
Pencil it in as a recurring weekly appointment for as long as you own the business. Doing your bookkeeping weekly keeps you in touch with what’s happening with your money and builds your relationship with it — and that awareness tends to result in you making more money.
Establish standard operating procedures and systems
Whether you handle the finances yourself or hire someone, you need standard operating procedures (SOPs) and systems.
Think about how you create content: you find an idea, research and outline, write, edit, create images, publish, then promote. That’s an SOP. You need the same for your finances. Your financial SOPs should answer:
- What programs will you use to manage your finances?
- How often do you reconcile your bank account?
- How often do you categorize expenses?
- How do you build a budget and plan out your sales?
- Do you create a quarterly business plan?
- How do you decide what to pay yourself, your employees, and your contractors?
- How often do you consult an accountant or bookkeeper?
When your financial process happens the same way every time, it’s reliable — and if you ever feel like you’ve forgotten a step, you can review your SOP and see exactly what you missed.
Find a professional you can ask questions to regularly
I’ve mentioned hiring an accountant a couple of times, and it’s worth repeating: have one on your team so you can get help when you need it. Maybe you only need them to file your annual return, or just to answer questions about financial decisions. Either way, find that person now — not the minute you’re in a crunch.
When you have someone you trust and can rely on, it’s easy to reach out instead of scrambling to find help at the last minute. And when we rush, we don’t always get the right answers. Avoid that rush by lining up a professional you can count on today.
You really can master your business finances like an accountant without being one — and doing so can be the difference between a business that succeeds and one that fails. Which of these tips stood out most to you? If this helped, share it so it can help someone else, too.
This article is for general educational purposes only and is not legal, accounting, or tax advice. Always consult a qualified professional about your specific situation.