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Simplify and Save in 2008
Skip the overwhelming resolutions this year! William J. Lynott explains how to make subtle changes in ’08 for big-time benefits.
The trouble with New Year’s resolutions is their limited shelf life. All too often, a “to do” list scribbled at the beginning of the year becomes nothing more than a hazy memory by the end of January. The usual reason for this has to do with the unrealistic demands that most New Year’s promises place on their well-meaning, but naïve, pledgers.
Fortunately, when it comes to your business, there’s no need to make ambitious yet unattainable promises. Instead, try these six simple measure to ease problems and pump up your net income in 2008:
1) Bundle communication costs.
As a salon owner or independent contractor, you have to keep yourself easily within reach. Fortunately, thanks to broadband Internet access, cell and landline telephone services, and pagers, you’re never far from anyone you want to contact—or anyone who wants to contact you. Unfortunately, you’re probably paying a lot more than you need to for all of that technology. If you’re like most business owners, you added individual services one at a time, paying top dollar for each one.
You can lower your communication costs with a bundled plan, which many service providers now offer. These plans usually combine the cost of services such as cell and landline phones with Internet fees for an overall rate that’s lower than paying for them all separately. Not only does this save you money, but dealing with only one company means that you’ll only have to pay one bill, saving you time and simplifying your bill paying. Contact your local service providers to learn about what bundled plans are available in your area.
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2) Give your accountant a pay cut.
We all hate paperwork and keeping records, but if that means you find yourself scrambling to find receipts and other records at tax time every year, you’re probably racking up some avoidable accounting expenses. “When clients present me with a shoe box full of unsorted papers, I have to charge them for the hours it takes to make sense of them,” says Tom Normoyle, an accountant in Huntingdon Valley, PA. “If they used a simple filing system that separates the different types of records, it would absolutely reduce my fee.”
Normoyle says that even the simplest of systems—one file for income and one for expenses—can be a money saver. Going a step further by separating expenses into categories such as payroll, office supplies, capital purchases and taxes can truly make a difference in how much time it takes to prepare tax returns. Also, remember to take the time to reconcile your bank statements each month; balancing your books will further reduce accounting fees by eliminating time spent tracking down unaccounted-for items.
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