A challenge for business owners is managing both personal and business finances. Usually, if you have your personal finances in order, your business finances should follow suit. Here are a few tips to help you manage your finances:
- Open a separate checking account for your business—It is a good idea to create a separate checking account just for the business. Having separate accounts will make keeping your personal and business finances separate much easier. This is especially important when it comes to being organized and paying your taxes. If you're a business owner and you do not already have separate accounts for your finances, look into opening a personal checking account and a business checking account.
- Open a personal savings account—As a business owner, you probably already know that your income is not always going to be the same from month-to-month. There may be a few months where you make more than the last... and there may be a few months where you make less. Because business owners' income varies from time to time, it is very helpful to have a savings account. Having an emergency fund will help you during your slower months.
- Use automated services such as bill pay—Business owners often spend a lot of time and attention running their business. Because of this, it may be helpful to utilize a service like bill pay to automate your personal bills. If you set up automatic payments, you'll be less likely to get busy and forget to pay for a bill.
- Consider an individual retirement account—Even though you're self-employed you should still be considering your retirement plan... There will come a day when you are either not able to work or do not want to work anymore and you will need some type of means for income. Opening up an individual retirement account will help you save money today that can be used for your future retirement.
- Consider purchasing life insurance—A lot of business owners don't think about the need for some type of life insurance plan. If something were to happen to you and your income, what would your family do? Protecting yourself and your family with life insurance is something to consider.