Your finances are a significant aspect of running a small business, and being fully aware of your business's finances is important for business success and to keep the cash flowing in. 

Being fully aware of your business’ debts is also vital to help you notice any anomalies that could indicate theft or unseen debt. It will also ensure that you have money to plow back into your small business to keep it growing. Here are some tips you can use to remain at the top of your small business finances

Track your daily costs

The costs of new pens, envelops, paper clips, and other small items can quickly accumulate and become a problem. Reviewing these costs will help you ensure that no money is lost and that the items bought are essential to the running of the business.

Have a proper management system

If your business is especially young, and you do not have the budget to hire a professional accountant, you can still take steps to keep your accounts in order. There are also plenty of software applications for small businesses that you can use. With a proper accounting system, you will be able to track your expenses, sales, profits, and changes in capital.

Be industrious especially with invoicing

Always send out accurate invoices as soon as you offer a service or ship out products. Ensure that each invoice has a payment term of 7 days to ensure that payments are not forgotten or lost in the process, and follow up with emails or SMS to confirm that your clients receive the invoices. Also, use an invoice reference numbers to cross-reference with payments and in your ledgers, cashbooks, and other books of accounts. 

Have a separate bank account from your personal one

Separating your personal and business funds is a vital rule of effective business finance. Mixing up business and personal funds will make accountability impossible and tax filing a headache. Having your business account separate will ensure that you can account for any account credits and debits without relying on your memory. It will also help you cater to business expenditure without interfering with your personal funds.

Pay yourself frugally

You should be able to enjoy the benefits of your business, but not so much that you suck up all its income. Your business is still small, and you still cannot afford to take home every cent you make. Always set away some money for emergencies and lean months. Also, only give yourself government-mandated benefits and a reasonable salary. As your business grows, you can use the funds to get professional staff, updated technology and furniture, and other things that will strengthen your business against your competitors.

Keep your traveling costs minimal

Avoid splurging company money on luxurious hotels and travel amenities. Simply have a place to lay your head and prepare for your seminars, conferences, and business meetings. These costs are incredibly high and will offer incentive for your employees to misuse company funds as well.

Rent rather than buy

Renting can be valuable and a money-saver for equipment that you rarely use. You should not have to spend millions of dollars on a high-value piece of equipment and follow up with additional storage and maintenance costs for equipment. You should also rent office space as relocating will be easier.

Avoid unnecessary costs

Small business owners may get carried away by the pressure to have an impressive brand and visible assets. Do not spend massive amounts of your personal cash on graphic design, business cards, marketing materials, and other items before the business starts to make money.