Let’s be honest: “budgeting” doesn’t exactly scream excitement. It’s not as fun as closing a big sale or finally getting your website to load the way it’s supposed to. But when it comes to bookkeeping for small businesses, budgeting is what keeps the lights on, and your stress level a whole lot lower.
If your budget is currently a scribbled Post-it and a prayer, don’t worry…You’re not alone, and we’re here to help. Here’s a no-fluff, real-world guide to building a budget that actually works for your business (and doesn’t make your eyes glaze over).
First things first: gather all your income and expense info. And no, “I think we’re doing okay this month” doesn’t count. Pull reports from your bookkeeping system (like QuickBooks Online, which we highly recommend) or your trusty spreadsheets, though spoiler alert: spreadsheets can get messy fast.
Break your income into categories (products, services, surprise Etsy sales from 2019, you name it). Then list your expenses: rent, software, payroll, subscriptions you forgot you were paying for… you get the idea.
Pro tip from Augie the Octopus: Mixing personal and business expenses can lead to confusion and inaccurate financials. Keeping them separate makes your bookkeeping (and tax season!) a whole lot easier.
You don’t need a five-year plan worthy of a Fortune 500 boardroom. But you do need realistic, short-term goals.
Want to save for a new hire? Pay off a loan? Finally, take a vacation without checking your email every 12 minutes(!!)? Cool. Budget for that.
Start with:
A). Monthly revenue goals
B). Expected expenses
C). A little wiggle room for surprise costs (because business is full of plot twists)
Now it’s time to do the math. Estimate your income for the month and subtract your fixed expenses (like rent) and variable ones (like coffee for the team because you’re a cool boss). What’s left is your net income—or what we like to call, “Your Budget’s Plot Twist.”
Use that info to decide what you can:
A). Save
B). Reinvest in the business
C). Use for debt payments or growth
Here’s where bookkeeping for small businesses really shines. Use your bookkeeping software to track your budget versus your actuals.
If your actual expenses are higher than planned, don’t panic. Just review the “why” and adjust for next time. Budgeting is like a GPS—it only helps if you check it once in a while.
Business changes. Prices go up. A big project falls through. Or you finally get that client who pays on time and in full (a rare unicorn, but they exist).
The key? Don’t treat your budget like it’s carved in stone. It’s more like a whiteboard, designed to be flexible. Revisit it monthly, tweak your numbers, and stay honest about what’s working (and what’s… not).
A solid budget gives you freedom. It helps you sleep better, plan smarter, and stop guessing where your money went.
Need help with bookkeeping for your small business so you can actually stick to your budget? Your friendly neighborhood bookkeeper (hi, that’s us 👋) is here to help! We’ll help make sure your books stay up to date regularly so you have the information you need. Ready to get started? Let’s chat!
💬 Advice from Augie: “A budget isn’t a buzzkill. It’s your business’s bestie in disguise.”
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