It’s important to take steps to ensure you’re not making any costly mistakes. Mistakes in recordkeeping can be costly, not only because of the penalties you may face, but also because of all the time and energy it takes to fix them. That’s why I want to share with you the top three mistakes that I’ve seen business owners make when it comes to recordkeeping and how to avoid them.
The first mistake is not keeping track of your income and expenses. It’s easy to get caught up in the day-to-day tasks of running your business and forget to document your income and expenses. However, this can be a big problem. Without accurate records, it’s impossible to confidently prepare your taxes or understand your financial position. Plus, the IRS can assess hefty penalties for not keeping adequate records. To avoid this mistake, I suggest using accounting software like XERO or my own service, Your Virtual CFO, to track income and expenses. This will help you stay organized and have up-to-date financial information.
The second mistake is failing to set up a separate bank account for your business. Many wellness coaches and service providers try to manage their funds from their personal account, which makes it difficult to keep track of what money is coming in and going out. Setting up a separate business bank account will help you better manage your funds and give you greater visibility into your financial position. It also gives you a layer of protection should something happen to your business. With the right tools and systems in place, I’ve helped my clients set up separate business bank accounts successfully.
The third mistake is not having a clear plan for your finances. All too often, wellness coaches and service providers try to manage their finances on their own without having a clear plan in place. This can lead to issues down the line such as misallocating funds or not understanding where their money is going. To avoid this mistake, work with a professional like me to develop a plan that works for you and your business. I have extensive experience developing plans for wellness coaches, lifestyle service providers and consultants. I can help you identify areas of improvement and create a roadmap for success.
By avoiding these mistakes, you can save yourself time, money, and stress down the line. If you’re looking for help with streamlining your recordkeeping, consider working with me and my team, Your Virtual CFO. My team and I have extensive experience helping wellness coaches just like you get their finances in order and achieve success.
