Budgeting Essentials

Last week I talked about “It is never too early to start budgeting!”  If you missed that post, you can review it HERE.  This week’s post is “What about the cloud?”  Many software companies are moving their software to the “cloud”.  They use convenience as a big part of their sales pitch.  But is what you give up in security worth the “convenience” of having your financial information in the cloud?  Learn more in this week’s blog.

Last week I talked about “How does a Financial Plan (budget) benefit a Small Business?”  If you missed that post, you can review it HERE.  This week’s post is “It is never too early to start budgeting!”  Most people think of budgeting as an end of the year activity.  But the best way to create a budget is to collect your budget information as you are going through the year.  Learn more in this week’s blog.

Last week I talked about “Good Financial Statements use Matching!”  If you missed that post, you can review it HERE.  This week’s post is “How does a Financial Plan (budget) benefit a Small Business?”  When you are running a small business, sometimes you can overestimate your memory.  Even though you are capable of keeping your finances in your head, often you have enough other things going on that push the finances out.  Then a financial decision comes along that is going to affect how much cash you have on hand.  Should you make that decision from your memory?  Learn more in this week’s blog.

Last week I talked about “Is Why does my accountant seem so formal?”.   If you missed that post, you can review it HERE.  This week’s post is “Good Financial Statements use Matching!”  One of the rules that accountants have to follow is the Matching principle.  Following this principle helps keep your income statements accurate and helps your decision making process.  Learn more in this week’s blog.

Last week I talked about “Is your small business is on track?  Check your budget”.   If you missed that post, you can review it HERE.  This week’s post is “Why does my accountant seem so formal?”  When it comes to knowing whether or not you make money, there are rules that you have to follow. Good Accountants follow those rules.  The structure that comes with those rules becomes a habit.  Learn more in this week’s blog.

Last week I talked about Be Prepared – Have an Emergency Fund.  If you missed that post, you can review it HERE.  This week’s post: “Is your small business is on track?  Check your budget”.  You seem to be making money.  At least that is what your income statement says.  That is good, if you have included all your expenses.  You can know for sure if you have a well prepared budget.  Learn more in this week’s blog.

Last week I talked about Budgeting – Review Regularly and Adjust as Necessary.  If you missed that post, you can review it HERE.  This week’s post is Be Prepared – Have an Emergency Fund.  Your business is no different than your personal life.  Unexpected things come up that you need to pay for quickly.  The Boy Scouts have a motto: Be Prepared.  That applies to business and life, not just Boy Scouts.  Learn more in this week’s blog.

Last week I talked about Budgets are the owner’s responsibility, not the Accountant’s.  If you missed that post, you can review it HERE.  This week’s post is Budgeting – Review Regularly and Adjust as Necessary.  Once you have completed your budget, you are not done working with it.  You need to compare the budget to your actual results.  Then your variances will show you where you may need to adjust your operations.  Learn more in this week’s blog.

Last week I talked about Put more money in your pocket - by not paying interest.  If you missed that post, you can review it HERE.  This week’s post is Budgets are the Owner’s responsibility, not the Accountants.  Many people think that a budget is something that is your accountant’s responsibility.   While the accountant may put everything together for you, in order to have a well prepared budget, you need to be the one who is responsible for what goes into that budget.  Learn more in this week’s blog.

Last week I talked about What is a Budget and Why Do I Need One?.   If you missed that post, you can review it HERE.  This week’s post is Put more money in your pocket - by not paying interest.  One cost saving area that small businesses miss is borrowing money and paying interest on their equipment purchases.  While it may seem convenient to borrow the money, there is a cost you have to consider.  This is an area where you can put more money into your pocket.

Last week I talked about Finalize Decisively.   If you missed that post, you can review it HERE.  This week’s topic is: What is a Budget and Why Do I Need One?  Before you can understand how a budget can help you, you have to know what it is.  This week I discuss what a budget is how it can benefit you.

Last week I talked about when you have a good final draft step away.   If you missed that post, you can review it HERE.  This week’s topic is Finalize Decisively.  You can fine tune your numbers to the point where you lose focus on the big picture and your goals. Over working the details will not make your budget match reality perfectly.

Last week I talked about keeping your monthly cash flow positive. If you miss that post, you can read it HERE. This week’s topic is when you have a good final draft step away.  It’s important when you think you have a good final draft, to step away and not look at it for couple of days. Today I discuss why.

Last week I talked about Be conservative with your estimates. If you missed that post, you can review it HERE.  This week’s topic is keep your monthly cash flow positive. Planning your cash flow may seem to be something that you can’t do. But with a well prepared budget, you can avoid many cash flow issues before they happen. 

Last week I talked about working on income early.  If you missed that post, you can read it HERE.  This week’s topic is be conservative with your estimates.  One big temptation you need to avoid when preparing a budget is being too aggressive with your numbers, especially when you are working on your revenue. Today I discuss why. 

Last week I talked about concentrating on important items. If you missed that post, you can review it HERE.  This week’s topic is start working on income early. Estimating your revenue (Income) correctly is the key to creating an effective budget.

Last week I talked about making sure you pay yourself first.  If you missed that post, you can read it HERE.  This week’s topic is concentrate on important items.  We all have the same amount of time to spend on our lives.  Don’t waste time over analyzing budget items that are not significant issues to your business.

Last week I talked about creating a schedule for your budget.  If you missed that post, you can get it HERE.  This week‘s topic is paying yourself first.  This is important on two levels.  First, when you pay yourself first, you are directing your business by setting a goal for it to achieve instead of just taking whatever is left at the end of the year.  Second, this keeps you in control of your finances instead of your finances controlling you.

Creating an effective budget is not something that just happens.  You need to have a good knowledge of your business.  You need to take time to look at what you have been doing.  You need to take time to look at what you are going to do.  If you are going to get all those things done efficiently, you are going to have to have a schedule.  Today I discuss how to prepare a schedule for your budget.

I recently posted about small business owners examining their businesses to make sure that job duties were being performed by the correct staff.  If you missed that post and would like to review it, CLICK HERE.  Today I am sharing a procedure you can use to analyze your staff duties.