Failing to keep good financial records is like driving a sports car at top speed with your eyes closed. It may be ok for a little while, but eventually you will crash and burn. Perhaps one of your new year’s resolutions is to keep better financial records for your business. You may have pledged to finally tame the paper beast lurking in your office, or at least find your desk under all those receipts. But there’s one small problem.
You think the only way to achieve these goals is a painful one.
In fact, you believe that walking on broken glass would hurt less than “doing the books” on a regular basis. Fear not! Here are 5 easy ways for you to stay on top of your bookkeeping in 2012:
1. Make Friends with Technology
There are cost effective ways to make collecting and recording your business expenses easy. This is not a myth. I will not be suggesting you consult the Loch Ness Monster in the next bullet.
Despite being a finance geek I absolutely hate tracking expenses. Then one day I discovered Shoeboxed and the world became a brighter place. Shoeboxed will convert expenses into an organized data file. No more typing in paper receipts!
The best part is that you can submit expenses just about any way you want short of carrier pigeon. Electronic receipts can be emailed, scanned copies of receipts can be uploaded for processing, and hard copy receipts can be submitted in the postage paid envelopes supplied.
Other easy and cost conscious options you may wish to consider are; Concur, Expensable, Keebo (UK Based), and Neat.
2. Call In Reinforcements
Would you pay someone $100 to keep from being in a head on collision at 70 mph? How about $200? $1,000? In fact it is hard to give an upper limit because you know the effects of a head-on collision would be devastating, potentially fatal.
Wouldn’t you pay to save your business from a similar fate?
Technology alone may not be enough to conquer your accounting needs this year. A great solution that is easy on the budget is a bookkeeper. Shop around for a reputable one who will strive to stay within your budget and provide regular reporting on key metrics.
3. Visual Reminders to Open Your Eyes
Select a picture or graphic that reminds you of the consequences if you fail to follow through. Then select a graphic that depicts the benefits of success. My first picture would be a Pinto driving off a bridge, and the second would be a Porsche 911 Turbo convertible cruising down the Autobahn.
Put these on a page, print it, out and hang it on your wall.
4. Make Falling Off the Wagon Hurt
Keeping resolutions is hard. Creating new habits is hard. Only 19% of people who make resolutions actually keep them. Clearly positive reinforcement alone will not work.
Every month you fail to keep your commitment do the following. Get a one dollar bill from your wallet and say out loud, “I’m simply throwing money away.” Then tear up that bill and throw away the pieces. Need a bit more drama? Burn it instead.
If the $1 bill doesn’t make you wince, try a $5, $10, or even $100 bill. By not tracking your financials you are actually throwing away far more money than you destroy in this exercise. In fact, you may be about to drive your business right off a cliff and not even know it.
5. Be Publicly Accountable
While peer pressure was the bane of your existence in high school, now it can be a very effective tool. Declare your bookkeeping intentions. Not just to your Mom, your golf buddy or your dog. Declare it on your blog, this blog, or some other painstakingly public forum.
In your public declaration include a commitment to provide monthly or quarterly updates on your progress. Failure to post an update will cause people to assume that you didn’t follow through. Who wants that verdict in the court of public opinion?
Final Thoughts
Which of these ideas will work for you? Do you have another tip or trick that can help people tame the bookkeeping beast? I really will come back and check for updates in the comment section.
Porsch Photo via Shutterstock
I love #5. Having someone to gently remind you (and occasionally shake you a little harder) can be a great way to stay on track.
Nicole Fende
Thanks for commenting Robert. Would you like to share at least one accounting goal here? We promise to keep the reminders gentle!
Anita Campbell
Welcome to Small Business Trends, Nicole!
Nicole Fende
Thanks Anita. Happy to be here.
I am in love with the Shoeboxed concept. Also the visual reminder thing – works for just about ANY new habit you want to create.
Nicole Fende
I agree the visual reminder helps with so many things. You just need to be sure your office doesn’t end up looking liked a crazed wallpaper hanger was let loose.
Love number 4, Nicole – nothing like the avoidance of financial pain to make you stick to your goals.
Nicole Fende
Yes and it drives home exactly what you are loosing. I’ve done the exercise as a demonstration and it really is hard to do.
How much does Shoeboxed cost? I was over there checking it out but don’t see a pricing page and their sign up says 30-days free trial but doesn’t say what it will cost afterward…the concept is genius, tho!
Love this article. Sharing widely!
Nicole Fende
Hi Tea, while there is a free forever plan its pretty limited. For $9.95 a month you get everything except the pre-paid mail in envelopes. If you add those in the price goes to 19.95 – still well worth it if you have lots of paper receipts.
Tear up money?! How about a piggy bank? Or a swear jar that you can donate to someone?
Nicole Fende
LOL – YES! The reason why its so important to destroy it is the reminder that you are destroying value. When you ignore your business finances you are absolutely burning money.
That said, perhaps you could tear up $1 and donate $20 to a good cause.
Haha Ok Ok, we’ll see…
Love number 1 🙂
This method in accounting Cost Effectiveness – Beneifts must outweigh the costs I learnt this method in basic concepts of accounting information system
Nice job, Nicole!
(And, it’s great to see you on Small Business Trends)
I, too, hate tracking expenses. Tried Quickbooks for 2 years. Failed.
Shoeboxed, huh?
Thanks,
The Franchise King®
Nicole Fende
Thanks Joel, its good to be here.
I’ve often heard that Quickbooks is not a good fit for solopreneurs and micro businesses. I love Shoeboxed and it is so easy (No they don’t pay me to say this).
This year I have got to do number 2…otherwise I will probably be under the jail. I hate this stuff so much and you work so hard to make it easier for people I appreciate you so much for that! It does help with the numbers whisperer in your ear!
Just reading #4 hurt. Tearing up money, even just a one dollar bill is too easy to tape back together. I like burning or shredding, ouch!!
We switch our accounting over from a standalone app (Quick Books) to a cloud solution (Quick Books online) and have seen about a 25% time efficiency. The cost may be slightly higher than updating an app to the new version every 2-3 years, but we’ve found it well worth it.
Robert Macklyn
I liked the ways defined to stay on top of the accounting aspects. Practically there if we look out little more deep, the main aspect of the accounting is the expense I guess. To have that in control and manage the same does make a better sense at all possible time. Literally I believe that the usage of tool make the things alright and based on that I have been using the cloud based expense reporting software from Replicon ( http://www.replicon.com/olp/expense-reports.aspx ) that is based on cloud and the user friendly and calender based platform gives the ultimate result and output.