NerdWallet, a consumer advocacy and financial literacy website, recently surveyed successful small business owners to find out what they wish they’d known when they were just starting out. Below, their six most frequently cited tips:
1. Hire an accountant.
Crystal L Kendrick, president of the Voice of Your Customer, a Cincinnati-based marketing company: “There are many deductions, loopholes and requirements that only professional financial professionals are trained to identify and manage. If company finances are not properly managed, the accountant and bookkeeper may have to redo all of your work to complete your annual taxes. Fees for duplicate efforts, incorrect entries or late filings can be astronomical and unnecessary.”
(MORE: 5 Mistakes to Avoid When Starting Your Own Business)
Josh King, founder of Tinderbox Consulting in Spokane, Wash.: “My number one tip? Consult a CPA before filling out any paperwork or choosing what type of business you’ll set up. There are pros and cons to be aware of when deciding between an LLC, sole proprietorship, S Corp., etc. You may have to pay a consulting fee or an hourly fee, but it’s money well spent. Nothing is worse than paying unnecessary taxes!”
I’ve also learned you need to follow a few basic rules after losing your job in your 50s.
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