Five Ways a Bookkeeper Can Save You Money
Here at Angel Bookkeeping, we think this month’s blog is timely. It’s about saving money. When we think about it, there are many more than five ways a bookkeeper can save you money – directly and indirectly. But, these are the core ones; the big, more impactful financial pluses that we think you should know about.
Life isn’t great for everyone right now. And here’s why: It’s not news, of course, that the cost-of-living crisis continues.
It’s everywhere, and it reaches out to touch almost all of us. Whilst inflation may be on a slow decline, prices for the things you need and want are still uncomfortably high. Not least due to a steep increase in interest rates, which are affecting mortgage repayments. Time to rein things in.
As you know, being smart, savvy and careful with your hard-earned income isn’t always as obvious as it may seem. Ironically, it may involve an investment in services rather than, at least initially, spending less.
What we mean is, engaging the expertise and skills that you may not have, or want to have, could save you money.
Such as retaining a bookkeeper, for example.
1. Supporting Your Drive to Profit
Do you know your average profit margins? It can take a lot of work to keep track.
A professional bookkeeper can analyse your margins and offer valuable insight. How much is your business worth this month? How much money has come in, and what business expenses have you had? With support from a bookkeeper, you will know in real-time. For example, you could be paying far too much for a specific, essential service versus your competitors. Perhaps other suppliers could offer you a better, more affordable option which we’d be happy to recommend
Equally, you may have subscriptions that no longer serve your business. Or, you could be paying twice for the same thing – it does happen. Likewise, should we spot fraud, we can let you know immediately.
2. Cash Flow and Customers
A bookkeeper’s specialist knowledge is your customer relationship superpower.
With transactions in and out of your company’s business bank account, losing sight of missing payments or delays can muddy the water.
A bookkeeper will enable you to send out customer invoices on time for prompt settlement and ensure that you don’t lose track of them. You’ll know exactly who owes your business money and how much, ensuring that you can avoid sending out goods or providing services to clients with overdue accounts.
3. A Clear, Strategic Picture
A bookkeeper is extremely skilled in reconciling your accounts with your bank accounts. Thus, you will have accurate, ultra-current financial reports. With up-to-date books, you’ll get a clearer picture of where you are – right here, right now. This is vital. It makes complete sense. It’s not just a quick snapshot it’s a complete, in-the-round picture.
Now, you can forecast and plan.
Knowing the well-being of your business (or otherwise) can help you make better strategic decisions. For instance, to offer more or less of what you sell to your customers; to cut back or increase outlay on money-losing or money-making products. Even to take on your first member of staff, or subsequent employees. To downsize, expand, relocate or plan your exit strategy.
Yes, information at your fingertips really IS as powerful as that.
4. Pay Precisely What You Owe HMRC – and No More (or Less)
Here’s that horrible old cliché: two things are certain in life – death and taxes. It remains true.
We all pay tax. It’s our civic duty, and pays for our must-have services. Yet, without a bookkeeper, you could be paying too much to HMRC, or not enough. If you don’t know precisely what you can and can’t set against your tax bill – and some elements aren’t as obvious as they seem, submitting your Self-Assessment return turns into a speculative exercise.
Also, rules and regulations change, but filing deadlines – not so much. In fact, not at all.
Your business must comply with all tax laws, and maintain best practices. A bookkeeper will ensure that you’re on the money with all of it. Avoid fines from HMRC through non-compliance, not least by trusting your bookkeeper to file your accounts accurately and on time.
Registered for VAT? Or the CIS? It gets more complex. You may not have the time and headspace to focus on all of this.
5. Your Time is Valuable
Running a business is no easy task. Especially in the early stages, you try to manage almost everything: business development, marketing, and finally, delivering the services that people pay you for.
It can all suck up hours in a day, leaving you exhausted, stressed and less motivated than you want and need to be. To be fair, you didn’t sign up for this.
Juggling all those tasks leaves less time for administration, leading to neglect of a crucial part of your business: your figures. Yet, spending hours on admin is what business experts refer to as an “opportunity cost”. By this, we mean the working hours that you could and should spend maximising your skills, earning money, and experiencing the genuine joy of being your own boss:
Writing computer code, working on construction projects, creating content, taking photographs, or whatever marks you out as the hardworking entrepreneur you deserve to be.
Your bookkeeper will categorise and reconcile your transactions, prepare financial statements, and handle other bookkeeping tasks on your behalf. They will do this to the highest possible standards, enabling you to focus on growing your business.
What We Think
In summary, although there are no guarantees, engaging a bookkeeper such as Angel Bookkeeping could help you to save more than you spend. Not to mention the peace of mind that comes with knowing that your financial records are accurate, and being closely guarded under electronic lock and key.
Ultimately, your energy and time are your most valuable resources. With both, you can grow. With neither, the life balance you strive for may always be beyond your reach.
Don’t be that business owner. We are, as always, better together. Five ways a bookkeeper can save you money? No doubt there are more. Contact Angel Bookkeeping for more information.