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Track your budget!

Right now is the perfect time to start thinking about your budget for 2019. ZümiFi highly recommends taking advantage of the budgeting feature offered in QuickBooks Online Plus. Whether you are creating a budget for the first time or if you just need to adjust your budget, we have a few tips that can help you get started in the right direction.

  • Fixed Expenses: Start with your set monthly expenses and enter items like rent, monthly software subscriptions, phone expense etc. Since these will be consistent throughout the year they should be easy to estimate.
  • Variable Expenses: Create a list of items that will fall into this category. Items such like insurance premiums or fees for your CPA may be paid annually, or irregularly so be sure you capture them appropriately. Review your billing history for 2018 and perhaps even 2017 to get an idea of where you would like to set your budget for your variable expenses. You should also include those unexpected expenses like repairs and maintenance and/or new computers in your budget.
  • Revenue: Income is often the trickiest projection of all, especially for growing businesses. We recommend reviewing monthly revenues from 2018 and perhaps even from prior years to use as a guideline. Be realistic with your numbers, you don’t want to overestimate especially if you are a new business. Be somewhat conservative with these numbers and take into consideration the type of services or product you are selling, and whether you anticipate any additions or changes in the coming year.

Once you have your numbers entered, we recommend that pull up your Budget vs Actual report monthly. Do not let all that work go to waste! The Budget vs Actual report is a great tool that will help you track your income and expenses, and further help you understand where you were on target, and where you were off target in your assumptions. Understanding the relationships of expenses and revenues in your business is key to knowing how to control them, and leverage those relationships to your best advantage. You don’t have to be perfect, and you will never be 100% correct. So don’t hesitate – jump in, give it your best shot and you can always learn as you work with this reporting regularly and fine tune it going forward.

Of course, if you need assistance you can always reach out to our team at ZümiFi…

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Track your budget!

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