As a small business owner, something thatâ€™s likely always on your mind is your finances. Not only do you have to worry about the success of your business and the safety of any employees that you might have, but you also have the typical financial worries of the average person as well. With all this stress, you might feel like youâ€™re never doing enough in either your personal or your professional life with regards to getting your finances where they need to be. So to help ensure that the success youâ€™re able to accomplish financially never gets pulled out from under you, here are five tips for protecting your finances as a small business owner.
Separating Your Personal and Professional Funds
One of the first and best things you can do when you start your own small business is to separate your personal finances from any of your professional finances. Taking this step means going further than just getting a separate bank account for your business finances. You have to put everything financial that is for your business in your business name. If you donâ€™t take these measures, your personal finances could be put at risk if your business gets into financial or legal trouble. But by keeping all your finances separate, you can avoid running into problems on both financial fronts when one area of your life seems to be struggling.
Surviving Economic Hardship
When economic hardship strikes, it can affect you as a small business owner more than it might affect other people who havenâ€™t gone into business for themselves. Knowing this, itâ€™s important that you take certain measures that will help to protect both your business and your personal finances in the event that the economy takes a downturn. To help with this, Steve Nicastro, a contributor to Nerdwallet.com, shares that you should make yourself well-versed in things like taking out a line of credit for your business, knowing what you can do to help improve your businessâ€™s cash flow, and potentially refinancing or quickly paying off any debt you might have. In bad economic times, all of these options might help to keep you afloat when nothing else has worked.
Hiring The Right Financial Help
While youâ€™ll have to wear a lot of different hats as a small business owner, itâ€™s important that you know where you own strengths and weaknesses are so that you can hire on the help you need to be successful. If you donâ€™t have the time or know-how to take care of all the financials for your business, youâ€™re going to be a lot better off if you hire on someone who will be able to handle this for you. Not only will you be able to rest easier knowing that you have a trusted financially-minded person to rely on, but hiring on someone as your CFO, accountant, or controller will help you keep your own focus on other aspects of your business that will actually make you money.
Preventing Cybercrime and Fraud
Another part your finances that you need to be careful with as a small business owner is what you have accessible via the Internet. Cybercrime and fraud can happen to almost any business thatâ€™s not being very careful, so itâ€™s vital that you stay vigilant. According to Caron Beesley, a contributor to the U.S. Small Business Administration, some of the best ways you can protect your company online are to have a secure IT infrastructure, use strong password policies, and use just one computer for all your financial needs. By taking these measure, you should be able to feel confident in your prevention of online financial crimes against your organization.
Keeping Thieves At Bay
When you own your own business, anything that hinders your ability to make money could be putting your entire financial structure at risk. Especially if you find yourself losing physical product without seeing any rise in profits, you might quickly find your company in hot water financially. If youâ€™ve noticed this in your business, you might be having a problem with thieves, be it shoplifters or your employees taking advantage of you. To combat this, make sure youâ€™re hiring employees that you can trust and monitoring both your employees and your customers or clients to help keep everyone honest in their dealings with you.
To help you better protect your finances, consider using the tips mentioned above if youâ€™re a small business owner.