Whether you have a side hustle or a full-blown business, you may be running into challenges when it comes to managing your small business finances. From keeping track of your expenses to deciding how much to pay yourself, dealing with money in your small business can be quite the challenge.

It’s well-known that one of the major obstacles to succeeding in business for anyone is money. This is even worse for women, who face significant challenges ranging from not being taken seriously to the lack of access to investors.

Learning to manage my own business finances has been a process. Even as a Certified Public Accountant (CPA), I had to set up some new financial habits and processes in order to effectively manage the money in my small business.

If managing your small business finances is on your list of business concerns, here are 7 tips you may want to consider:

1. Track your business expenses by separating them from your personal expenses

Managing your business finances starts with tracking them properly. As working women, we handle so many responsibilities at once that we can be tempted to mix our personal and business expenses. In order to understand where your money is going, you must sort out which expenses are associated with your business.

What to do: Instead of dipping into your personal bank account, open a business account. Pay all your business bills from this account, as this will allow you to effectively track your expenses.

2. Pay your business bills on time

As you do with your personal bills, take care of your business expenses as readily as possible. This is especially important if you’re just starting a business and you, like many other women, don’t have access to large sources of funding. Don’t allow credit card late fees and tax penalties to ruin your business’ financial stability.

What to do: Set reminders to pay your bills on time and avoid late fees. Set aside some time to go over your finances on a weekly basis to ensure that you’re staying on top of your expenses.

3. Set money aside for your taxes

One question that many women entrepreneurs ask is how to manage their money, once they start making a profit. One of the first priorities when it comes to utilizing the profit you make in your business is to set money aside for your taxes.

What to do: Take into account your marginal tax rate and tentatively calculate the tax you may owe. Set money aside towards these tax payments as soon as you can. This will eliminate the stress many business owners face at tax time.

4. Decide what you will reinvest in your business

Another concern of women entrepreneurs is how much to re-invest in their businesses, especially when they do not have access to large sources of funding.

What to do: Depending on the extent of your expenses as well as the money you set aside for taxes, determine how much you will need to re-invest in your business.

5. Don’t forget to pay yourself!

While you should set money aside for taxes, business expenses as well as to re-invest in your business, you should also not forget yourself. Consider paying yourself out of the profits that your business is making as well. How much you should pay yourself will depend on your outstanding expenses as well as your current needs.

What to do: Carefully evaluate how much you need to set aside for taxes, expenses as well as business re-investment. Based on this, decide how much you can afford to pay yourself.

6. Learn more about small business accounting

One of your greatest business powers is in understanding your business’ accounting. Whether you choose to take classes, or hire an accountant, commit to learning more about how your money works for you in your business.

What to do: Make the commitment to understand the basics of accounting as related to your business. Start by taking available classes or consult with accountants and bookkeepers, for instance.

7. Minimize your expenses

It costs money to start and run a business. It took me a few months into my business to realize that some expenses were unnecessary or could be combined. As a result, I saved a large amount of money, which I was able to put back in the business and pay myself too in the process.

What to do: Comb through your expenses periodically and assess whether they are necessary.

To Your Success,

The Corporate Sister.