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Setting and Achieving Financial Goals

Setting and Achieving Financial Goals!

Financial security, whether that’s for a business or an individual, requires planning. You need to know where you want to be, where you are now, and how to cross the gap between the two places. Having goals and a plan makes it more likely that you’ll achieve financial security; whatever that means to you.

Here are some steps to setting your financial goals.

1. Be specific with what you want

It’s easy to say you want “financial security” but what does that mean to you? After all, financial security can mean different things to different people. Do you want money to cover your retirement? Do you want enough cash that you can handle emergencies? Do you want to live a lavish lifestyle or are you planning on downsizing?

Once you know your big goal, write out what that actually looks like to you. How much money do you feel you’ll need in retirement to cover your lifestyle? How much would make you comfortable? If you’re not sure what you’d need, talk to your financial advisor, who can ask you the questions and provide you with the guidance you need to determine how much money you should be planning for.

Remember that the most actionable goals are SMART (specific, measurable, attainable, realistic and timely). Know when you want to retire, for example, how much money you’ll need and how much you can realistically save by that time.

2. Write your list of goals and put each in a category

Some goals are short-term, some are medium-term and some are long-term. Planning for a holiday this year is a short-term goal, while retirement planning is long-term. Once you know what your goals are, put them in a category based on whether they are short-, medium-, or long-term goals. This will help you plan how much you need to set aside to achieve each, and what sort of timeline you’re looking at.

3. Determine your assets and debts

If you’re like most people, you likely have both assets and debts. Achieving your financial goals won’t be as simple as saving money. You’ll have debts you need to pay off. In the past, people often focused on paying off their debts, but that meant there wasn’t as much money set aside for the future.

Before you can map out a plan to achieve your goals, you need to know where you are currently. How much money do you have available to you? How much are you bringing in monthly? What are your expenses? What debts do you have and what are the interest rates?

Take stock of money flowing into and out of your accounts over a few months. Where do you spend the most money? Are there places you could cut back?

4. Build a plan to help you reach your financial goals

This can be a difficult step to take on your own because your own patterns and habits might influence how you plan. It’s worthwhile to talk with a financial advisor, who can review your information and help you set up a path forward. They can also keep you accountable for achieving your financial goals, and assist you in addressing any emergencies that may arise. They will also identify areas where you could cut back and how to make your money go further for you.

Final thoughts

By knowing what your goals are and having a plan to achieve them, you’re more likely to achieve financial security. Talking with an advisor can help you get your finances on track.

Kind Regards,
The Team at London Accountants

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5 Steps to Setting Up Your Business Processes for Success

5 Steps to Setting Up Your Business Processes for Success!

When a business first starts out, it’s natural for the owner to be a jack-of-all-trades. You may not have the capital to hire specialists or access to the technology that can help you. As your business grows (or as you look to take a smaller role in your company) you may find the business has become over-reliant on you, which makes it difficult for you to take a step back.

Here are some steps you can take to enable your business to thrive, even if you can’t be there all the time.

1. Review workflows

Have someone interview everyone in the company to find out what their job is and how they fulfill their tasks. Look at their processes to see if there are ways to make their tasks more efficient and seamless–you could even look at best practices in other companies to see how they manage their tasks.

The goal here is to make processes as simple and efficient as possible. Take out any unnecessary steps and ensure each process only involves tasks that are vital to successful completion.

2. Automate what you can

Often in business, people continue doing a task inefficiently simply because they got used to doing it that way. That can lead to hours being spent in activities that could be automated. Look at activities that are carried out regularly and investigate whether software exists to make that process easier for you.

For example, if your staff spends hours each day updating your customer database, it’s worth looking into customer relationship management (CRM) software, which automatically takes care of that for you, saving you time and reducing the risk of errors. Likewise, if your team spends time following up on unpaid invoices, consider an online invoicing system that automatically sends out overdue notices.

3. Document the processes

Once you have an idea of how people carry out their responsibilities and have identified ways to improve or automate them, write the processes out. If possible, keep the documents digital, so they can be updated as your business evolves and so everyone can easily find them. If you’ve purchased software to automate processes, make sure everyone who would use the software knows how to access it and can do so easily.

Finally, ensure the documents are stored somewhere safe and accessible for your staff. You could use Google Docs or software designed to help with business process management.

4. Train your staff

Now is the time to train your team in your optimal workflows. Make sure everyone has read and understood the documented processes and knows how to access and use any software or technology you’ve purchased. Ideally, you’ll have a couple of people trained to cover each area of your business, so if one is ill or unable to work for a while, someone else can easily step in to carry out those responsibilities.

5. Make your business self-reliant

You want your business to function without you so it still thrives if you become ill, need a vacation or otherwise can’t work for a while. Examine your processes for areas where the company is still overly reliant on you and look for ways to foster self-reliance. This may mean identifying gaps in your employees’ expertise and hiring people with complementary skills, finding new ways to automate workflows, working with consultants and outside service providers to fill in gaps, or creating an FAQ document where questions you’re commonly asked are answered.

Final Thoughts

As your business grows and you step away, you’ll need to ensure you have staff who can take over various activities. Reviewing and documenting your processes, automating what you can, and identifying areas where your business is overly reliant on you will set you up for success.

Kind Regards,
The Team at London Accountants

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4 Reasons to Switch to Cloud-based Accounting

4 Reasons to Switch to Cloud-based Accounting!

If you’ve been considering making the move to a cloud-based accounting system, you’re not alone. Cloud technology has impacted many business functions, including making managing financial aspects of your business easier and more efficient.

Cloud-based accounting moves your accounting from being hosted on your computer’s hard drive to an online platform. Cloud-based platforms like QuickBooks and Xero (our fave) offer important features that save you time and money, freeing you up to focus on other important business activities.

Here are 4 reasons to switch to a cloud-based accounting system:

1. Efficient invoicing

If your business relies heavily on invoicing, an online accounting system like Xero makes invoicing super efficient. You can email invoices to clients directly through your software and track how long it’s been since the invoice went out.

Clients pay you through a link attached to the invoice, making the payment process easier for them, which increases the likelihood they’ll pay you sooner. If they pay through the system, your platform will mark the invoice as paid automatically. If their payment is late, the system alerts you.

Further, you can set up your software to send automatic reminders about late payments. Taxes are automatically calculated for you and you can set up recurring invoices and retainers to further automate your invoicing.

2. Paperless accounting

Managing your accounting through a cloud-based system enables you to move away from paper accounting. You don’t have to worry about where or how to store years of paperwork and files because everything is securely stored in the cloud. Likewise, you don’t have to go through boxes of files to find a receipt from two years ago, you can simply access the information through your computer!

It’s easy for you to share your records with your accountant, bookkeeper or anyone else who may need to collaborate on your finances. You don’t have to mail them physical copies of your financial transactions and statements, you can email them the information or give them access to your software – easy!

3. Accessibility

With a cloud-based accounting system like Xero, you don’t have to be in the office in front of your computer to access your financial information. You can see your ledgers and reports from anywhere, on any device. If you want to work from home one day, you can log in to your software from your smartphone if you want, to send invoices, check your reports, or manage expenses.

4. Accurate reporting

An important component of running your own business is reporting. Accurate reporting enables you to better manage your finances and understand your profitability. It’s vital for making informed decisions about your business.

Cloud accounting provides you with accurate reporting at the click of a button. Using a system like Xero you can easily access profitability reports, income and expense reports and year-end reports.

The information is available to you automatically. You don’t have to spend hours in front of a calculator going through every invoice to see your numbers. Simply by keeping your records in a cloud-based system, you can easily generate accurate reports.

Final thoughts

If you’re hosting your accounting information on your computer hard drive, it’s worth looking into cloud-based accounting to see if you can benefit from the switch. Given the ease of invoicing and accurate record keeping, combined with the accessibility of a paperless system, you may find cloud-based accounting software is the right system for you.

Get in touch if you’d like to know more about Cloud-based accounting!

Kind Regards,
The Team at London Accountants

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