7 Tips to Reduce your Bookkeeping Stress

Business owners are always busy with making decisions about different areas of related work.

From making big plans to make sure all the employees in the business are working in cohesion, a business owner’s job is never done.

All these activities require strong support from experts or a system which can help you reduce bookkeeping stress and can help you lead your business toward growth.

Let’s look at some bookkeeping tips to help you get financial success while reducing your bookkeeping stress.

1. Keep your finances separate

Keeping your finances (business and personal) separate is one of the best practices to reduce bookkeeping stress.

Avoiding separation of your finance can lead you to trouble when lodging your personal and business tax returns at the end of that financial year.

In addition, mixing up personal and business income can be extremely stressful when it comes to reconciling your business’s financial situation.

To keep away your business from such stress - in the long run, set up business accounts, credit cards and debit cards in the company name.

If you are a sole trader, have a separate bank account for business banking.

2. Stay ahead of the game

Another tip is that save time and money during tax season by staying ahead of the game.

Let’s say if you are the owner of a business; then you must do taxes, there’s no choice.

What is a choice is making tax season stressful by avoiding your accounting throughout the year and rushing to get all done before the deadline.

We suggest keeping your books up to date for tax purpose at least once a month.

By this, you will save both your time and money.

3. Track your business invoices

It is a fact that late payments or unpaid invoices will automatically affect your cash flow.

Unpaid invoices can be another kind of beekeeping stress and to reduce such stress track your business invoices.

Don’t allow your clients to stay with your money for so long.

You can manage this by making sure no clients order new materials unless they have paid for the previous one.

You can also set deadlines for every payment and charge interest if a client fails to meet the deadline in order to manage credit control, which may not be an ideal situation.

However, having an automated reminder is a common practice. Before you set up automatic reminders, you must ensure that you reconcile books promptly.

Nothing annoys a customer more than being chased for a settled invoice.

4. Keep all your financial records

One of the best practices to avoid bookkeeping stress is ensuring that all documents used in your daily business transactions are kept well for future reference.

Always ensure that you have all your bank and credit card statements, balance sheets, receipts and invoices, profit and loss statements of sales and services rendered by the business.

It will enable an excellent financial ground for your business even when it expands.

5. Review your books often

Keeping your finances on the top of the list is one of the simplest ways to reduce bookkeeping stress.

Stay up to date with daily transactions, income, expenditure to better understand your business deals.

Log financials daily and record day to day transactions and daily income/revenue report. Optimise your CRM or invoicing system and wherever possible, link it with your accounting system.

Handle both the payable and receivable accounts.

Manage cash flow to protect the balance of revenue and expenses so that your business doesn’t run out of cash.

Maintain the accounts to complete your business’s tax returns smoothly.

These will help you run your business operations smoothly.

6. Get software help

To make your bookkeeping stress as minimal as possible, use accounting software.

Accounting software is beneficial to manage your finances, as it makes updating and reconciling your finances a seamless affair.

If you choose to use software with daily automatic bank feeds, whereby your bank statement lines feed into your accounting software, then you’ll have an overview of the cash in the bank and ready to reconcile.

Software not only manages your books, but it also ensures that your financial data is safe, secure and organised in one single place.

The software also protects your business data by using encryption technology; you’re less likely to encounter any fraud or cybercrime.

You can find a detailed accounting software guide here, top 7 accounting software for small businesses UK 2020

7. Hire an expert bookkeeper

A professional’s help means an additional set of eyes to look at your business’s finance at all times.

You will minimise chances of missing payment deadlines.

Besides, a bookkeeper will ensure that all documents used in day to day business transactions are well organised.

A bookkeeper will help you to establish a sound financial ground for your business even when your business expands.

Many accountancy firms offer bookkeeping services so that businesses can take care of strategies while they take care of books and accounts.

Wrapping up

Bookkeeping is not always stressful; in fact, proper bookkeeping can guide your business towards success.

By hiring a bookkeeper, you can reduce the burden on your shoulder to focus on the important areas of your business.

Accounting firms nowadays provide many economical packages for business which you can select as per your requirements.