How to Manage Small Business Finance Situations

Any business can get into a financial mess, but when you run a small business, it is easier to mix your personal finances with your business finances. You may borrow money from your personal account to pay for a business expense and forget to pay it back. You may use a company account to take your spouse to dinner and lose the receipt. All of these back and forth transactions can cost your company and yourself a lot of money if you’re not careful. The following are some ways that you can manage your small business finance situation.

The first thing you should look into is what type of payments you accept for products or services rendered. If you have invoices that get paid in 30, 60 or 90 day increments, you could find yourself turning to your personal account to make up the difference. Fortunately, you have some other small business finance options. Accounts receivable financing is just one of those. With this type of loan, you will get the money you need right up front. It’s like selling an asset to the financier, and you receive the financial benefits.

Something else you can do to manage the finances in your small business is to keep good records. Keep track of all your invoices and receipts for both incoming and outgoing purchases. This is good not only for you to project future business through real reports, but could save your bank account if you are ever audited by the IRS. Without proper documentation of your business finances, it could be hard to see if you are making money, losing money or just breaking even.

Growing your business can be difficult without the funds you need to do it. One smart way to manage your money as you try to achieve growth is by speaking with a financial expert about what types of loans will be beneficial. If you’ve got a short term project that will really boost business, but costs more than you can handle at the moment, ask about an unsecured business line of credit. If you want to move to a bigger building, but haven’t sold your initial property, look into a bridge loan. There are a lot of options that allow you to keep your personal finances at home, but still be able to see the growth you hope for.

Managing finances in any business can be a challenge, but by keeping your personal and business funds separate, it could be lots easier. Speak to a loan officer today to see what options you have to better manage your small business finance situations.