How do I track income and expenses in my new small business?

When you start your own business, it is easy to get overwhelmed with the paperwork involved in running the “business” part of the business.  Staying ahead of the accounting is critical at this point because falling behind will create a nightmare mess to be cleaned up later.  While you can start by tracking your income and expenses in a spreadsheet, this will quickly become cumbersome.  You will ultimately need to obtain an accounting system to ensure that you have everything properly tracked and your checkbook balanced.  There are several options available in the market for accounting systems built for people who aren’t accountants.  Two of the most popular are QuickBooks and FreshBooks.  Both have online versions if you would rather not be tied down to a single computer or have multiple users who may need to get in like a bookkeeper or an accountant.

 

What is most important is that you make sure that everything is tracked as close to real time as possible so you don’t fall behind.  It is easy to forget about expenses that you incurred if they are not tracked quickly which means you are losing tax write-offs.  In a future post we will talk about expense tracking software.

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Michael Giuffrida from Southington CT has been operating businesses since 1997.  He is an experienced entrepreneur in business management, profitable growth, business valuation, mergers and acquisitions, and information technology managed services.

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