Your taxes have been filed and there’s nothing left to do but relax and figure out how you’re going to spend that refund. While it is vital to take a break and relax every now and again, it is also vital to not let your finances take a back seat. With the stress of tax season in the past, now is an opportune time to take a look at your finances from a higher perspective and start planning for next years taxes. Here are 4 easy steps to help kick-start your financial spring cleaning
DON’T RELAX TOO MUCH
Relax as much as you can, but not so much that your daily bookkeeping falls behind. The better your daily records are, the easier it will be to balance the books when the time comes. Perhaps you’ve been thinking about a new software tool to help? Or maybe you’re thinking of taking a bookkeeping course? Now is the time to do it, while stress is low and you’re starting out a new year.
Don’t just focus on your day to day bookkeeping tasks, there is so much more to keeping your books. Take some time and look at your last year or couple of years. Are there any trends that you can build upon? Are there areas that need work? Look for ways to grow your business and your finances. Think about the big picture and where you want your business to be in 5 years. Take a close look at the systems that are in place and try to think of potential problems down the road. The IRS has agents who can help businesses of any size look at and create some of these goals and help with your business planning.
KNOW YOUR RATIO – DEBT: EQUITY
Most, if not all business, start out with more debt than equity. This is inevitable. You should make it habit to check your debt to equity ratio on a regular basis. Over time, this ratio should grow on the equity side, more than debt. If you are seeing the opposite, and your debt continues to rise, with little or no increase in equity, it may be time to look for a problem. Keeping an eye on this ratio is vital to the continued growth of your business.
REWORK YOUR GOALS
It is important to have financial goals. Setting goals is a great way to keep track of where you are, where you want to be, and how close you are to getting there. However, it is also important to reevaluate and change your goals as needed. Situations change over time, and your goals may as well. That is fine, as long as you are making changes in your goals and your plans to account for these changes. An excellent way to get help with this process is by working with a professional bookkeeper or accountant.
Many people think of spring cleaning as changing the curtains and washing the walls. It is also a great time to clean up your finances and ensure that you are still on track to where you want to be. All business will benefit from taking time each year to evaluate their financial strategy. If no changes are needed, that’s great! But if there is something that needs some tweaking, now is a perfect time find it. To learn more about our accounting service, call us today!