5 easy steps to starting your business with good accounting practices - for all trades (plumbing, electrical, mechanic, contractor, etc.)

Hey there! Let's talk about getting your books in order for your new business. As someone who's worked with plenty of contractors, mechanics, and trade business owners, I know this stuff can seem like a real headache. But I promise, it doesn't have to be that complicated.

Here's How to Get Your Business Books Started (Without Losing Your Mind)

Step 1: Open a Separate Bank Account

Listen, mixing your personal and business money is asking for trouble. It's like trying to organize your nuts and bolts by throwing them all in the same bucket. Head to your bank and set up a business checking account. This way, when tax time comes around, you're not sorting through hundreds of personal McDonald's receipts to find your work expenses.

Step 2: Pick Your Bookkeeping Tool

You don't need anything fancy here. While QuickBooks is popular, even a simple spreadsheet can work when you're starting out. The key is picking something you'll actually use. If you're not tech-savvy, there's nothing wrong with a basic system - just make sure you're tracking every dollar that comes in and goes out.

Step 3: Set Up Your Filing System

This one's dead simple - get yourself a folder (physical or digital) and start storing those receipts. Every time you buy something for the business, snap a picture with your phone or toss it in the folder. Trust me, trying to find six-month-old receipts during tax season is about as fun as finding a stripped bolt in the dark.

Step 4: Track Your Time and Materials

If you're billing customers for jobs, you need to know exactly what each job costs you. Write down your hours, materials used, and any other expenses for each job. This helps you figure out if you're actually making money or just keeping busy. Plus, when it's time to quote the next similar job, you'll know exactly what to charge.

Step 5: Schedule Your Money Management Time

Here's the real talk - set aside time every week to handle your books. Maybe it's Sunday morning with a cup of coffee, or Friday afternoon before you crack open a cold one. The point is, make it a routine. Letting it pile up is like not changing your oil - eventually, it's going to cause you problems.

Remember, good bookkeeping isn't about being perfect - it's about being consistent. If you're struggling, don't be too proud to ask for help. A good accountant is like a good mechanic - they might cost money upfront, but they'll save you from expensive problems down the road.

Have more questions about getting your business finances organized? Reach out to Trades CXO. We specialize in bookkeeping/accounting and marketing/advertising for the skilled trades. Book your free consultation today, or email us at hello@tradescxo.com.