Each year, people assess their finances and the analytics teach them about the mistakes committed last year and things they can do to have a more profitable year of business. Business owners and finance professionals may be an exciting task for them. However, finance management for a freelance WordPress professional is nothing more than a task that distracts them from their crucial web development work.
Have you reached a point where you can measure your business and wish to outsource finance responsibility to a professional? If yes, then go ahead. In case, you wish to continue with it, here’s a guide on finance management you can use to ensure your cash flow is perfectly managed:
Different Accounts
It always helps to have separate accounts for business and personal usage. This will help you to keep close track of the flow of money and manage business expenses such as rent, fees for conferences, themes and plugins, Internet, meetings (coffee and food with clients), etc.
Create Budget
There are a number of costs you require managing for business. Start with reviewing what you have spent on, the last year. Also, take note of the amount you spent on a monthly basis all year. For a new business, prepare a comprehensive list of business expenses you would be paying for in the following year such as rent and utilities, WordPress expenses (plugins, theme, SSL Certificate OR Wildcard SSL Certificate, hosting, CDN, domain, etc.), business promotions, licenses, insurance, new tools and equipment, and everything else you require to start or run the business.
Comparison of this budget against incoming revenue will let you make crucial financial decisions related to business in the future.
Revenue Goals
Some of the present-day time-tracking apps such as Toggl and Harvest will let you get deeper insights into the amount every project essentially nets you. Know the amount that flows out of business each month and set revenue goals to make sure you are within the black every month.
Keep a Close Record of EVERYTHING
You must not skip on this. Make sure you record all stuff associated with finances. Tracking business profits and losses in a spreadsheet is a bad idea. The labor-intensive process will just waste your time and energy. One of the best things to do is hire a professional accountant. If that’s not feasible, go for another excellent option of having bookkeeping software. Wish you could cut down on expenses on software and increase productivity? Go for some of the performance-oriented small business finance management tools such as FreshBooks, QuickBooks, etc.
Focus on Payments
It is quite a headache to find that all clients are not reliable. You would want them to pay well for the good service supplied. As a professional, you would also want your time and process to be valued. Unfortunately, that may not be the case each time. So, you need to make ample arrangements for protecting yourself and even make sure you get paid for your work. This is what you need to do exactly:
Develop a very strong and foolproof contract that clearly records everything from the fee of your project, timelines, deadlines, penalties to be paid by clients for non-payment, and other conditions.
– Avoid taking up jobs from finicky (very finicky) clients who would not pay well. Customers with spidey senses should be avoided.
– Keep feedback of clients in check.
– Using a payment processor such as PayPal is a good idea. Everyone knows about it and trusts it too. The clients won’t be able to make excuses for not paying through PayPal.
Monthly Review of Finances
Love WordPress? Don’t worry. Finance management is quite similar to WordPress. All you need to do is simply take your eyes off finances for a few weeks and an unpleasant surprise will be waiting to shock you! Unfortunately, finances don’t have simple solutions to fix things.
How do you handle your WordPress website? You prefer using different types of monitoring tools and analytics to make sure things are on track. Management of finance for your WordPress business is no different.
You can make use of some of the tools such as bookkeeping software, PayPal, banking services, time trackers, and many more. These are available with built-in analytics. Experts and WordPress maintenance service providers suggest creating a detailed system of reports for each. Thereafter, review the financial performance on a monthly and yearly basis.
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