#10: GET IN THE FLOW WITH THE RIGHT PROS

In this episode, I’ll discuss the importance of collaborating with the right professionals to enhance your small business and get into a good flow. Learn about effective communication, choosing the right professional, regular financial reporting, and the benefits of advisory services. Discover how the right support can keep your business operations flowing smoothly.

Key Points:

·         Importance of communication with professionals

·         Regular financial reporting and reviews

·         Defining your needs from outsourced professionals

·         Advisory services from tax professionals

·         Guidance on choosing the right business entity

·         Bookkeeping services and their frequency

·         Ensuring collaboration among financial professionals

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GUSTO (affiliate link): https://gusto.com/r/leslie4559

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My favorite budgeting app w/ an amazing free version:
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My preferred business credit card with cash rewards (affiliate link):  If you have healthy behaviors around spending with a credit card, this is a great one to use and earn cash back. It also links up well with QuickBooks Online. If you have unhealthy spending habits with credit cards, please avoid using one! You need to be able to pay it off monthly and not carry a balance. I use this one for my business and it makes paying bills simple.
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Disclaimer: This content is for educational and informational purposes only. Please consult with an accounting professional for direct advice based on your specific business situation.

Transcript

Hello my amazing entrepreneurial friend. Welcome back and thanks for tuning in.  If you're new here, I'm Leslie Roth your host and you're listening to the Financially Adjusted podcast. I'm here to discuss all kinds of topics that affect your small business finances. I share my knowledge when it comes to money management and general entrepreneurship. And I'm here to encourage you and empower you on your journey to and through business ownership. Today's topic is all about how you can get into a flow with the right pros in your corner.

I've talked a little bit in the past about hiring professionals and how it's important to hire people that you're willing to who are willing to teach you and communicate well. We'll touch on this a little bit more today. I'm also going to talk about the different ways that an outsourced bookkeeper and tax professional can help you in your business. When I say get in the flow, I'm referring to having a relationship of collaboration that leaves you feeling more informed and powered and supported in your business. This collaboration should keep your business operations flowing smoothly.

The number one thing to look out for when you're hiring professionals is definitely their education and communication style. Keep in mind that the communication part is definitely a two-way street. There needs to be a conversation in the beginning stages of working together regarding how you each communicate best and how you'll communicate with one another moving forward. For instance, when speaking with a potential new client, I touch on this, and I let them know that I have a system for communication that involves using a shared Google spreadsheet to list any transactions or items that I have questions about. I let them know that I'll send this to them monthly or twice a month for them to fill it out and get back to me. So, I've set that expectation of what to expect timing wise and with systems. This conversation also involves me finding out from them what their best form of communication is, whether it's email, text, etc. And I find out what days and times work best for them to get in touch.

I inform them of delivery frequency of financial reports and let them know that they'll get a profit and loss statement as well as a balance sheet monthly. I also let them know that I offer a complimentary quarterly financial review meeting to go over their reports and help them understand their financial situation. They are also encouraged by me to email anytime that they have questions instead of just waiting until that quarterly meeting. I like to keep the lines of communication open, so I know that they're understanding what's going on and the reports that I'm sending to them because it's important that they understand their numbers monthly not just quarterly. No matter what type of outsource work you're hiring for, whether it a bookkeeper like me tax pro, lawyer, or financial advisor, you first have to consider what you need and want from their services, how best you communicate, and your level of knowledge when it comes to that aspect of your business. If you are totally new to the business world or just lack understanding in a particular area, it's incredibly important to have someone in your corner who is approachable and can meet you at the level you're at. There needs to be a good ongoing collaboration with this person. For the sake of your business health. And this means that your personalities need to jive.

If you're working with someone who you kind of dislike or rubs you the wrong way or talks down to you, find someone else because it's unlikely that you're going to gain all you can from that relationship. Or maybe you're working with someone who isn't willing to or doesn't do a good job at phrasing things in a way that helps you understand. Maybe they talk on a higher level, and you have no clue what they're about. If this is the case don't be afraid to bring up that you need things explained in a different way or you need to go back and start at the basics a little bit more. If after communicating this, they still aren't able to provide what you need, consider looking elsewhere.

If you're hiring a tax professional, ask them if they do advisory services as well as just doing tax returns once a year. It's important that you have someone who can work with you on strategies for your business throughout the year versus just at tax time. Depending on the level and complexity of your business, it might not be necessary to meet that frequently throughout the year. You may only need to meet mid-year to touch base on whether or not there are tax strategies you can implement prior to tax time. Most tax strategies are lost when December 31st hits.

You also want a tax pro that will help you understand your tax returns versus just handing them off to you. Helping guide you with estimated tax savings and payments is also a big one. Your tax pro should be able to help you send in the right amount so that you don't have a huge tax bill once a year. A good bookkeeper can also guide you with this since they know your specific net profit throughout the year.

The last thing I want to mention is looking to pro on guidance for the right business entity. If you're an LLC, depending on the type of business you have, it might be in your best interest to elect S-corp status at a certain level of income. This can save you greatly on self-employment taxes which is the reason many businesses elect this status for taxes. It's not for everyone so definitely consult with a good tax professional. But if it is right for you, they can help you with the process as well as advise you on what a good reasonable salary would be for you. I dive further into this topic in past episodes, so I won't get into all of that here I want to give you an idea of all the things that you achieve with a tax pro and things to bring up in those initial meetings.

If you're hiring a bookkeeping professional, you will want to get an idea in advance of what services you wish to outsource. I recommend having an outsourced bookkeeper who can take care of the bookkeeping on a monthly basis and provide a profit and loss statement as well as a balance sheet. If you are a very small business with only a handful of transactions, you still want to outsource the work, quarterly bookkeeping might be a good option for you if you don't have the funds for monthly. I do recommend monthly to everyone though because it's the optimal way to stay on top of your numbers. You also want to consider whether or not you need to outsource accounts payable or accounts receivable to a bookkeeper. Accounts payable involves the management of bill payment to your vendors and accounts receivable involves management of your invoicing and collecting on invoices.

Payroll is also another service in your business to consider. A bookkeeper can help you manage this by setting you up with a payroll company and facilitating this process as well as running your payroll when that time comes, however frequently you do it. Some bookkeepers also do full payroll services meaning that they will be the ones to calculate and submit all of your payroll tax filings. If the bookkeeping firm has multiple employees, I would say this is fine. But if it's just one person that would be handled the payroll and filing of taxes, I say steer clear. Because if only one person is in charge of your entire payroll process, and something happens that keeps them from being able to run it, then you'll potentially be in trouble and not able to pay your employees on time. You would have a single point of failure in this service, meaning if there's no one else that knows the process of your payroll or no one else is set up to file your payroll taxes. That would be a huge problem. To avoid that go into or go with a multi employee firm. Or with a payroll processing company, having your standalone bookkeeper facilitate payroll processing through a payroll company is different than them doing it all themselves. Being clear up front about this will reduce the risk of anything like that happening to you. And being clear upfront with the exact tasks and systems that you would like to see outsourced to a new potential bookkeeper will help them understand your needs. Also letting them know how you currently are handling different financial tasks and systems will help them to help you improve on and potentially take over all your systems. The idea is that you are on the same page with your bookkeeper, and you're both clear on what the expectations are. A good bookkeeper can also help you manage and track your estimated payments and your profit goals.

They should also be willing to openly collaborate with other financial professionals. So when I meet with my clients quarterly, if they choose to do so and if they choose to set goals I will help them look at their statements and see if they're meeting those goals and look at some different areas of expenditures that can be lowered and talk with them about different categories and whether or not they're spending in a healthy way in those categories.

When you have amazing professionals in your corner and you have solid systems set up and good communication with them, plus they're collaborating with one another. It is a game changer, and you will most definitely be in a financial flow with your business.

Another financial professional who you might want to look at hiring is a financial advisor. This is a person you can have in your corner that collaborate with your other professionals like your bookkeeper your tax professional. They can advise you on retirement options and the best way for you to invest your money for retirement for your situation in your business. Because it'll depend whether you're a solopreneur or have different employees and they will have different recommendations for you based on all of those factors. So, it's really important to have all of your professionals collaborating with one another.

I hope this was helpful and got the wheels turning for you and your own specific situation. I do want to challenge you to evaluate your current financial professional relationships and if you're getting ready to switch or hire someone new, keep all of these things in mind and be clear about what you're looking for when you interview people.

Do yourself a favor and go check out some of my free financial resources over at financiallyadjusted.com. If you're a chiropractor, I have built one specifically to help you. It's a sample chiropractic P & L statement with healthy ranges of numbers.

I'll be back next week with a very helpful episode which will be teaching you about profit and loss statements and helping you understand them. Have a great day!

Disclaimer: This content is for educational and informational purposes only. Please consult with an accounting professional for direct advice based on your specific business situation.