Why you should care about your personal finances Mar 2, 2017
Personal Finance 101
Here we finally are, it’s March already which means we are exactly two months away from the looming personal tax filing deadline. It seems like a great place to start a new series on the blog dedicated fully to finance. My not-so-distant background is actually in Accounting (cue shock and awe and a proud display of my BCOMM degree!). Through my conversations with business owners of all kinds I have come to the realization that not a lot of people actually know much about the topic. It really seems like something that we tend to brush off isn’t it? We love to dump a stack of receipts at our accountants offices and assume that they will do whatever they need with it so that at the end of the day you will save money. Funny how that works, because a lot of times it actually has the opposite effect. The less YOU know about accounting, the more work you are creating for those who do and as a result the more money you spend on their services. If an accountant saves you $5,000 in taxes but you pay them $5,000 in service fees you didn’t really save much money at all did you?
But how are we to know this if nobody ever spells it out? There are a ton of great ways in which accountants come in really handy, the trick is to know how to utilize their help. Unfortunately for all of you who actually care this means you will probably have to brush up on your basic finance knowledge. By no means am I suggesting going back to school and taking a crash course in accounting. I wouldn’t wish that on anyone… although, to be completely honest, it’s probably not a bad idea. It will suck but you’ll walk away and somewhere down the line be thankful you did it.
The less YOU know about accounting, the more work you are creating for those who do and as a result the more money you spend on their services.
I am NOT the only person in my field of work who gets excited about numbers. We all love getting paid! We love the feeling of a nice full bank account and a job well done. Assuming we’re all responsible adults, knowing how much money you make is just as important as knowing what to do with that money once you made it. How/if to invest it? Spend it? Keep it? Donate it? If you want to be treated as a true professional, regardless of how creative you are, or what type of other excuse you may have for not being able to pick up a calculator, it’s YOUR responsibility to know how to run YOUR business. You can hire an accountant and a business advisor, sure, they can tell you all sorts of exciting things that will make you feel like you’re on the right track but that lack of control over your own, hard earned money has the potential risk of setting you back or derailing you completely. Something that I always take away from dealing with people when it comes to my business is that nobody will care about it as much as you do.
This is where I come in. I have this extra knowledge, access to some really smart accountants, family of business owners and am myself managing to fill my closet (or put food on the table…) with money I made in my own business that i’ve been growing over the last five years. Why not share it? I’ve had some interesting conversations over the last year with fellow bloggers who have little to no clue about how to run their business. People who don’t know the difference between HST and GST, or why they should even consider the idea of incorporating! It’s almost as though we are deciding to be business owners because everyone is doing it, some even not realizing they ARE business owners. I couldn’t believe that someone who charges people money for services they provide can get away with not knowing good business practices or how to write a simple invoice. Maybe I’m cynical because I went to business school and these ideas are second nature but it seems obvious that if you find yourself in a position of collecting money you should know a thing or two about it.
...nobody will care about [your business] as much as you do.
So we went ahead and made a series of videos walking you through some major business questions we’ve heard over the years, it may feel advanced for some and we WILL circle back and go through some of these topics again. The first video (in this post) is a quick intro, but stay tuned this Friday to get better acquainted with the idea of incorporating.
I hope these posts come helpful in your journey as a [serious] business owner. I would love to hear what questions remain unanswered and if there are topics you would like to see covered in this series. If I don’t know the answer I know a whole lot of people that do, it’s my goal to make finance and accounting easier, clearer and a lot less scary for you, and sometimes even myself. xoxo
Tags: accounting, finance, personal finance 101, video