Life Change Checklist: 4 Tips for Starting a New Business
November 12, 2015 : Carrie Smith - Guest Contributor
According to a study by the Small Business Association, more than 50% of the population works in a small business, and since 1995 small businesses have generated over 65% of net new jobs in the U.S. Starting a new business is an incredibly exciting venture. But bringing your business idea to life can be a challenging process. Before setting out on the path to starting your own business, here are some tips that I learned through starting my personal business ventures.
1. Open a Separate Bank Account
Opening a separate business bank account should be at the top of your to-do list. It’s the quickest way to separate your personal transactions from your business ones, making it easy to see all the tax deductions your business is eligible for. It is also beneficial to set up a separate tax savings account for estimated taxes, an expense you’ll need to pay every quarter.
2. Setup a Recordkeeping Process
A strong recordkeeping process translates into less time wasted on administrative tasks, and may enable you to claim greater tax deductions and credits. It also helps legitimize your business and can come in handy in the event your business would ever be audited. Research the best tax accounting or bookkeeping software that offers features like tracking inventory, payroll, recording tax deductions and printing regular reports. (Note: we here at H&R Block are partnered with Xero. Get more information about our Small Business services. -Kristin)
3. Create a Consistent Work Schedule
Whether you work at a store-front or in your home office, establish a regular work routine from the outset. Limit distractions by setting up your to-dos as appointments in your calendar and then adhering to this schedule.
Next, set up your ideal work environment. Find a place that’s quiet, eliminates distractions and allows you to work productively. Make your work zone your sanctuary! Just don’t get so immersed that you overwork yourself to the point of burnout.
4. Keep Tabs on Cash Flow
Set up regular meetings with your accountant or tax professional on a monthly or quarterly basis to check in on the progress of your company’s cash flow, revenue and profit and loss. Knowing where your business is now, and where it’s headed, will give it the best chance of succeeding.
With these tips, your small business will start off on the right foot.