We finish off our look at the top nine accounting tips for independent window cleaning companies with a look at the personal side of business financial planning. Feel free to look back over Part 1 and Part 2 for information about taxes, cost analysis, and more.
This may not sound like an accounting tip, but it has a lot to do with how your money is processed. As you’ll see in the next tip, you need to keep your personal money and business money separate. The best way to do this is to get an LLC for your business so that all the money coming in can be registered to it. You can file for business credit cards, hire employees, and get special discounts on supplies if you can prove you’re a company and not an independent contractor. Invest the time and money necessary to establish a legal name for your business.
You need to pay yourself a salary just like someone else would in a regular job. Even though all the money coming from your business is technically yours, you can’t spend it all on yourself. Take out what you need for bills, food, and a little fun money, but store all of that into a second bank account. Register the business account under the business name to make it easier for you to calculate your taxes every year. If you get in the bit of doing this, you won’t confuse your trips to the store with trips for the business that can ultimately be deducted from your taxes.
It takes time to become successful in this industry, just like it does in any other industry. You can still turn a profit in your first year in business, but don’t expect to make hundreds of thousands of dollars from the start. You can certainly do that over time, but that will be after you have developed a name for yourself in your community. Save money before going into this business to avoid going into debt, or make sure someone else in the house is earning enough to pay the bills. You’ll be on your feet soon enough, but you don’t want to fall hard before that happens.