Staying on top of your money, both business and personal, is the best way to stay in the black on your budget and in your bank accounts. When you commit to look at your numbers weekly, you’re more inclined to look at them even more often and not disregard your profit and loss statement at the end of the month. And, if you’re balancing your account every month, you won’t feel an impending sense of doom in November because you’re not sure if your business is profitable or not in the current calendar year.
But what are you supposed to be looking at when I remind you to do your Friday Check-in? I know you’re busy, so let’s make this as simple as possible. Here are the four things you must do to stay on track.
Review Your Transaction History
Once a week, log into your bank accounts online—both personal and business. Take a look at all the transactions that occurred since you last logged in and reconcile them. This means you’re making sure that each transaction is accurate and actually took place. This is one of the best ways to ensure you catch fraudulent activity early and helps you stay in tune with how much money is going into and coming out of your accounts.
Code and Categorize Transactions
If you’re using QuickBooks Online or QuickBooks Self-Employed, your transactions will be coded automatically if you set the program up correctly. If you’re not using QBO, download your bank transactions to a csv file so you can open it in Excel and manipulate it. You’ll be able to code each transaction to specific categories so you can get a good feel for how much you’re spending on contractors, education, eating out and more. This is an important process for bookkeeping and taxes, but it also helps you take a closer look at your budget so you can make adjustments as needed.
Separate Processing Fees
Most business owners forget this step, but keeping tabs on your processing fees from your merchant processor is vital so you can accurately report your earnings. Merchant processing fees are the fees you incur by using Square, PayPal, Stripe and other payment processing systems. And while no one likes paying these fees, they’re a part of doing business online.
Review Invoices
Whether you send invoices once a month or at the end of a project, you should review all your invoices once a week. If you have invoices that are outstanding beyond your payment terms, send a reminder. If the invoice is more than 45 days late, contact a collections agency to help collect the debt.
Next time you see me post on Instagram or Facebook about your Friday Check-In, now you know what to do! Even if Friday isn’t your day to check on your accounts, make sure you have it on your calendar once a week and that you keep up with it. If you want your business to survive and thrive, it’s non-negotiable!
