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Don't Let Your Books Be a Horror Show: Avoid These 3 Bookkeeping Mistakes

man stress out doing bookkeeping.

As a small business owner, you're probably well aware of the challenges that come with managing finances. Keeping track of expenses, invoices, and payments can be overwhelming, and mistakes can be costly. In fact, there are a few common mistakes that many small business owners make when managing their finances. In this post, we'll take a closer look at three of the most common mistakes and how to avoid them.

Failing to Keep Accurate Records

One of the biggest mistakes small business owners make when it comes to managing finances is not keeping accurate records. Without accurate records, it's impossible to know exactly where your business stands financially, which can lead to poor decision-making and missed opportunities.

To avoid this mistake, make sure you're keeping detailed records of all your business transactions. This includes tracking your income, expenses, and any other financial transactions. You can use accounting software or hire a bookkeeper to help you stay organized.

Mixing Personal and Business Finances

It can be tempting to use your personal accounts for business expenses, especially if you're just starting out. However, this can lead to major headaches down the road, especially when it comes to taxes.

To avoid this mistake, make sure you're separating your personal and business finances. Open a separate business bank account and use it exclusively for business transactions. This will help you keep accurate records and make tax time much less stressful.

Failing to Plan for Taxes

Taxes can be a major headache for small business owners, but failing to plan for them can be even more problematic. Many small business owners don't realize that they need to pay estimated taxes throughout the year, which can lead to penalties and interest charges.

To avoid this mistake, make sure you're setting aside money for taxes throughout the year. Estimate how much you'll owe and make payments on a quarterly basis. This will help you avoid surprises come tax time and ensure that you're staying in compliance with the IRS.

In conclusion, managing finances can be challenging for small business owners, but avoiding these common mistakes can make a big difference. By keeping accurate records, separating personal and business finances, and planning for taxes, you can set your business up for success. And remember, it's always a good idea to seek professional advice from a bookkeeper or accountant to ensure that you're on the right track.

Ready to make a change?

At Marlene Matthews Bookkeeping, we specialize in providing approachable, fear-free bookkeeping services to small businesses. We help you understand your numbers so that you can do more of what's meaningful to you – in your business and in your life. Contact us today to learn more about how we can help you avoid these mistakes and keep your financial books in order.



Hi, I'm Marlene! Lover of all things spicy, coffee purist, and your bookkeeping ally for pursuing your passion + boosting your bottom line. Thanks for coming by!


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