We’ve all been there (yes me too)- your business is rocking and rolling. You’re pumped to be making sales, getting clients, and improving your products and services. You’ve been focused on getting your business on point when WHAM you remember that you haven’t done your bookkeeping in a really long time.
Now, you’re trying to figure out how in the hell to get things caught up and how you got here in the first place.
First thing first- this happens to a lot of small businesses. So, before you go down the emo I-suck-so-much path, know that you are not alone!
Second, because this is a common thing, there are actually some common reasons it happens AND there are a few easy fixes to these reasons.
And now here’s the low down on why your books are behind and how to take action immediately:
You don’t have time
The number one reason people fall behind in their business bookkeeping is time. As small business owners, we have A LOT to do and we have to make tough decisions about what gets done when.
I feel you. And now this:
You actually DO have enough time to do your bookkeeping and deal with your money.
But, are you prioritizing your finances and bookkeeping and making the time for it? Because the time is there- it’s up to you to utilize it.
You’re prob like, “Okay who is this lady and what does she really know about making time in my business?” so I’ll share.
I used to never “have time” to do my own bookkeeping and keep up with my finances. I always said that I was too busy with big projects and client work to work on my OWN finances. Come tax time, my bookkeeping would be a year behind and I’d be scrambling to catch it up.
And then I got really sick of that attitude and changed it.
It turns out that taking care of my own business finances actually only takes 10-15 minutes a day. And instead of taking up more of my time, setting aside small, daily chunks of time for my finances SAVES me time.
When I’m only working on the right now, and not trying to catch up the past, I’m able to focus and fly through my bookkeeping.
How to deal with not having enough time:
First, make a list of all the thing you need to catch up in your bookkeeping. Get detailed! Break up everything on your list into small actionable steps.
Then, dedicate SMALL chunks of time every day for your business finances. Think 15-30 minutes a day.
Why small? Because right now you probably don’t believe me about money not taking all day but you’re willing to give this a go because you’re desperate to get your books caught up.
So instead of starting with 6 hours a day, which will reinforce the mindset that finances take up too much time, let’s start small and get used doing small things for our money daily.
Schedule this time into your daily calendar. DO NOT schedule something else during this time.
During these small periods of time, do 1-2 tasks on your list.
Do as much as you can during the 15-30 minutes and then stop. Let yourself get used to the daily routine of handling your books without expectations and frustrations about how much you should do.
You’re waiting for the perfect system
Systems are really important to helping people stay organized and on track with their business finances. Without a system, you feel like a floating blob in a galaxy of options. This galaxy is filled with questions the hold you back: Should you use QuickBooks? A spreadsheet? Wave? Xero? Pen and paper?
The questions go on and on and instead of actually doing your books, you spend most of your time wondering HOW you should do your books. Hours go into researching a perfect accounting system instead of actually tracking your income and expenses.
Yes, it’s important to develop and fine-tune a system but here’s a trade secret- no one’s bookkeeping system starts off perfect.
Why? Because you actually have to USE the system to discover what needs to change to better fit your workflow and business.
Every time you use your bookkeeping system you’ll discover what works, and what doesn’t work. As you make these discoveries you’ll make changes that make your system work even better. In no time at all, you will have the PERFECT system for your business.
How to deal with waiting for the perfect system:
Stop waiting and just start with something. Even if it’s something really simple and you think it’s lame. What’s more lame than a simple accounting system is no accounting system at all!
And this lame system will actually become your BFF because it’s going to teach you what you really need in an accounting system. You’ll instantly see the limitations of what you chose and maybe even some perks that you didn’t know you wanted.
When picking a “just start” bookkeeping system consider these questions:
How much time do you need to learn the system? (You want to go with an option that is low on the learning curve scale)
Do you have access to this system right now? (If you need to buy software that you can’t afford, then go with a system that is accessible to you now)
Will you actually use this system? (Maybe you love the idea of using QuickBooks but find yourself naturally drawn to pen and paper. Go with the pen and paper. You will actually use it)
You’re afraid you’ll make a mistake
The last big time reason people fall behind in their business bookkeeping is because they are scared they are going to make a mistake, and to avoid making a mistake, they don’t do anything at all.
Let’s get this out of the way: yes, business finances can be intimidating. But you won’t learn anything if you don’t start. Even if you make a mistake- you’re going to learn valuable information from these mistakes.
You’re going to make MORE mistakes if you put off your business bookkeeping until the last minute. You’ll be so stressed about finishing it before the deadline that you’ll rush through your bookkeeping and do all kinds of weird things. Trust me, I’ve fixed a lot of rushed bookkeeping system and things get really weird when people hurry.
So don’t get weird and don’t rush through your bookkeeping. Make mistakes now so you have plenty of time to learn from and fix them.
How to deal with fear:
Start by making a list of all the thing you are worried about screwing up in your bookkeeping. Take some time to reflect on what you need to know to feel confident about catching up your books and jot down your questions.
Then, put on your research hat and start looking for answers. Commit to spending 1-2 hours answering your questions.
You can type your question directly into Google (you’ll be surprised by how many people are asking the EXACT same question) or join my Facebook group and share your questions there.
After you’ve gathered the information you need to know, start doing your books. Seriously, just start.
Every time you have a new question, write it down. Every week make it a point to research your questions. You will find that not only will you actually get your books done, you’ll become more confident doing them.