I've been running a small business for a year now but I have trouble keeping a record of my cash flow. Are there any easy cash flow tips for beginners like me?
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The fact that you are so keen to track your cash flow is a very good sign and an indicator of future success.
The best way to do this is to find a cloud-based software package (Xero and Moneysoft are good examples of paid subscriptions but there is also Pocketbook available at no cost) and set up the categories you want to track. It’s pretty simple and very effective.
It’s even more valuable to link your cash flow tracking to a projected pathway. You could create two scenarios and then track the actuals against each or the one you most want to be your reality. Give the scenarios meaningful names like, “Life is as it seems” or “It’s a perfect summer”.
It’s a bit like when you fly overseas – there’s a flight plan and then a flight path. What’s important is to know how far away from the original plan you are at any time. Have a look at our website if you want to read some case studies in which we used this technique.
I would suggest making it a weekly habit to ensure you’re up to date with transactions.
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