Next order of business is setting up an accounting system. Scary, isn’t? It’s quite simple, actually, and there are many programs today you can use. Imagine it decades ago, when all the accounting was done in big leather books and small writings. Nowadays, it doesn’t look anything like that.
To set up an accounting system for a small business you will need a few essentials. First of all, you will need to keep a record of all your expenses and payments. Keep also your receipts and invoices, always being aware of your tax obligations.
Remember when we talked about budgeting? Setting up an accounting system will be of great help. Having one specific place where you keep all your records will be beneficial for your business, as it will help you figure out exactly how much money is going in and how much out.
I would also recommend opening a separate bank account for your business. Especially if you’re keeping your day job (as I suggested you should do!), you won’t want the money to mix.
You may use some of your savings to pay for the business, but all the money you make back should be kept separate, at least until the end of the tax year. This is because sometimes, it happens that we miscalculate taxes and expect to pay less or more than needed. I also recommend hiring an accountant to handle the end of the tax year payment for you. It will seem like wasted money at the beginning, but trust me — it’s so mentally stressful to do it by yourself.
Hope this will be useful!