At a certain point, it just makes sense to outsource your business finances. But how do you know if it’s time? While there’s no hard-and-fast rule for when to outsource your business finances, there are a few telltale signs your business is ready for it.
Different Ways You Can Outsource Your Business Finances
Outsourcing your business finances is not a “one size fits all” thing. There are several different types of financial professionals who each perform different roles. Here are the most common ways entrepreneurs outsource their business finances:
An accountant is your go-to for all things money in your business. They manage your books, file your taxes, pull reports, pay expenses, and assist in making financial decisions. (Of course, this all depends on the individual accountant and what services they offer.)
A bookkeeper is in charge of tracking your business finances, meaning expenses, income, and everything in between. They pull reports and help you keep everything organized. Unlike an accountant, they don’t make financial decisions or send your money anywhere, they just keep track of it.
A tax preparer.
A tax preparer helps you prepare (and sometimes file) your taxes. Most tax preparers only meet with their clients just before tax season. They can help you get your paperwork in order, find extra deductions, and sometimes even file your taxes.
A consultant, coach, or membership.
Okay, so this one isn’t technically outsourcing, but having someone in your corner can help ease your financial stress.
A business finance consultant or “coach” can help you create (and stick to) systems for tracking and managing your money. They don’t have access to your finances like an accountant or bookkeeper. Instead, their job is to strategize your money management systems and help you find new ways to grow.
A community or membership, on the other hand, is usually made up of one or two finance pros and a larger group of like-minded business owners. My community, The CASH Club, is a space for entrepreneurs to seek support while they DIY their finances. They get to manage their money on their own, but they don’t have to do it totally alone.
3 Signs It’s Time to Outsource Your Business Finances
Not sure if you’re ready to outsource your business finances? Here are three signs you should.
1. Your business isn’t growing.
Many entrepreneurs experience “hitting a wall” in their businesses. You’re still making money, but you’re not growing. Often, this happens when you’re trying to get over the $5k, $10k, or $20k per month hump. It can be frustrating and discouraging.
In this case, I highly recommend outsourcing your business finances. A financial pro will be able to assess your current financial situation and determine where the issue is. They can help you decide when to raise your prices, switch up your offers, or outsource other business tasks. Whichever type of financial pro you hire, they’ll want to see you grow, and they’ll do what they can to help.
2. You can’t pay yourself what you need to.
This is a big one. I’ve worked with a lot of business owners who spend years paying themselves barely anything just to keep their businesses afloat. But if I had to guess, you started your business so you could make more money, not live paycheck-to-paycheck. So what went wrong?
If you’re not paying yourself as much as you need or want to, there’s a problem with your business’s revenue, expenses, or both. If you’re not bringing in enough money, it might be time to raise your prices. If you’re spending too much money on expenses, you might need to cut back. If there’s a problem with both, you may need to do a hard reset.
A financial professional can help you assess your current financial situation, determine how much you need to make to pay yourself well, and create a plan to get you from Point A to Point B. On top of that, they can also handle the money management side of your business so you can focus on the tasks that actually make money.
3. You’re overwhelmed and stressed out.
You have enough to worry about in your business. If you lie awake at night stressing about business finances or avoid your bookkeeping to-do list altogether, it’s time to outsource. Your business should afford you financial freedom and peace of mind, and outsourcing can definitely help with that!
How to Outsource Your Business Finances
Once you’ve decided to outsource your business finances, it’s time to start researching! Look for financial professionals who have experience 1) in your particular type of business and niche and 2) in your geographic area. If you can, get on a call with them to talk about your goals and needs. And if you’re not entirely sure you want to outsource, schedule a one-time strategy session. It’s a great first step to gaining financial clarity!
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