radford tax logo
07 5495 4100 ◆

Getting on top of cash flow

Posted on August 6, 2019 by admin

Managing cash flow is critical to the success of a small business. While it is necessary to be profitable, your profit is a number that shows up on your accounts at the end of the year whereas your cash is the money you have in the bank. By incorporating the following tricks, you can help to maintain the flow of money coming in and keep the business running smoothly.

Prepare a cash flow projection:
There are always unforeseen challenges or changes in the marketplace. While you won’t always be able to predict or forecast these, you can gain a better grasp on industry trends and patterns. Drawing up a cash flow projection can help you plan the ups and downs of your spending. In your projection, be sure to include:

Generate new business:
The business is going well; you’re meeting your targets, money is coming in, and you’re happy. This is not a time to relax, it is a time to be seeking out and generating more business. Cash flow may keep your business alive, but sales are what keeps cash flow alive. Keep expanding and preparing your business to cater for growth. This will help prevent you from chasing your tail when times are tough.

maximise your business's value

latest news

Start saving for the Christmas period early

Posted on October 16, 2019 by admin

If shopping centres aren’t even putting up their Christmas decorations yet, then the holiday period may seem to be a concern of the distant future. However, the season has a tendency to creep up on people and can often come with financial burdens. Planning your holiday expenses early can cut out one of the biggest stresses of the season and allow you to focus on enjoying the festivities and spending time with your loved ones.

If you’re worried you’re going to be tempted to dip into your savings, it can be a good idea to set up a Christmas saver account. This is typically done at the start of the year and is offered by some banks. You can make deposits throughout the year, but can only withdraw from the account when the festive season arrives, usually around 1 December. While interest is offered on these account savings, it should be noted that you can generally find better interest rates with other savings accounts such as a bonus saver or online savings account.

Alternatively, you can manually set aside an amount weekly or fortnightly in the months leading up to the holiday period. Setting up an excel sheet can help keep track of this, and can also be used to categorise different budgets for various needs (gifts, travel, food etc.). This can help you plan ahead and estimate how much you will need to cover the cost of the holidays, saving you from the bite of unexpected expenses and keeping you in control of your finances.

If you’ve left things a little late, it can help to cut out a few luxuries to save some extra money. Whether it’s having a cheap night in, or skipping a coffee run every now and then, a little can go a long way.

radford tax associationsradford tax associationsradford tax associations