A couple of weeks ago, I was having a conversation with my accountant while working from a coworking space. I was asking him questions like what the gross revenue was for this quarter, how we were doing in profit, where I was spending money, etc.
My new friend, office buddy, and aspiring freelancer overheard me and then asked “Oh my God! Do I need to be spending all of that? How do taxes even work?!?”
Managing money as a business owner can seem overwhelming. Most people are taught how to manage their personal finances (although barely), but business finances not so much.
Because we’re not really taught how to do this stuff, many business owners end up learning by trial and error. I know I have. If you’re having any fear about managing money as a business owner, here’s how to get over it.
Realize tons of people do it.
Every time I feel frustrated because I’m trying to manage a business budget, a personal budget, and taxes I have to remind myself that I’m not the only one in this situation. It can seem like you are when most of your friends have regular jobs, but the reality is there are millions of people in this country who are managing money as a business owner. This alone is really helpful to me because I realize that if I can do it they can do it too.
Even though I write about money for a living, math is not my forte. In my experience, money is a lot more about common sense and psychology than actual math. But, there are still aspects of it that really are mathematical. For this side of managing money as a business owner, I had to enlist the help of an accountant.
Not only do I talk to my accountant every time tax time comes around, I make sure to ask him questions about managing money as a business owner. He’s definitely got a lot more experience in this area than I do, so I see him as a teacher of sorts.
This has been a tremendous help in allowing me to get better at managing money as a business owner. While I still have some hiccups, they aren’t as bad as they used to be.
(P.S. If you want to do this with your own accountant, find one where this type of consulting is included in what you already pay them.)
No one learns how to manage money as a business owner overnight. That’s why it’s important that you cut yourself some slack and have patience. This is especially true in the first few years when you’re still figuring out what works and what doesn’t. While there are certain rules for this kind of stuff, there really is no instruction manual.
Managing money as a business owner, while at times challenging, is a skill you can learn. Just make sure to cut yourself some slack and enlist the help of professionals when need be.