Accounting Archives - Motl Accounting

3 Easy Ways to Plan for Retirement

401K, Accountant, Accounting, expenses, IRS, Retirement

Retirement can be an intimidating prospect, especially for individuals without financial planning experience. Fortunately, there are practical steps that anyone can take to make the process easier – no matter your age and financial situation. These essential planning tips will help set you on the path towards your future as a retiree. Start preparing now for life after work!

Start Early, Save Often

The younger you are, the easier it is to save; parenthood, homeownership and other responsibilities make it harder to put money away each month as you get older.By investing earlier on in life for retirement, the compound interest on your savings will allow your money to grow more and more every year. In addition, you may be able to take advantage of employer-based retirement matching. This will not only provide an extra boost to your savings, but you will also reap the benefits of pretax deductions.

Set Realistic Goals

Retirement planning is all about setting realistic goals and sticking to them. Determine what kind of lifestyle you want in retirement, then set a budget that reflects that lifestyle and make sure that your savings plan works towards achieving those goals. Consider inflation, taxes, health care costs, living expenses and other factors when making your plans so that your money will last as long as possible during retirement.

Create A Diversified Portfolio

When it comes to investing for retirement, diversification is key. Don’t put all of your eggs in one basket by investing only in stocks or mutual funds; instead create a portfolio that contains a mix of investments such as bonds, real estate holdings and other assets that can help balance out riskier investments like stocks or commodities trading. This way if one type of investment does poorly, another may do well and help cushion the blow of any losses incurred by their counterparts.

Retirement planning is not something to be taken lightly; it requires careful consideration and long-term commitment in order to ensure financial security later in life. Start early, save often, set realistic goals based on what kind of lifestyle you wish to lead in retirement and create a diversified portfolio so that any potential losses are balanced out by gains elsewhere in your portfolio – these are all important steps towards creating a secure financial future for yourself after retiring from work life! With these tips in mind, retirees can rest assured knowing they are taking steps towards building a solid foundation for their post-work lives.

4 Financial Tips for Small Business Owners

401K, Accounting, Bookkeeping, Business Expenses, Employee, expenses, IRS, Payroll, Small Business, Taxes, Uncategorized

As a small business owner, managing your finances can be overwhelming and intimidating. There are so many things to consider, from taxes to cash flow to budgeting. Luckily, there are some simple tips you can follow to help make the process easier. Let’s look at four financial tips every small business owner should know.

1. Create A Budget and Track Your Expenses:

Creating a budget is essential for any successful business. With a budget, you can easily manage your finances and plan for the future. Plus, tracking your expenses will help you identify areas where you can save money. Make sure to track all of your income and expenses (including taxes!) on a regular basis. This will ensure that everything is accounted for and that you have an accurate picture of your overall financial health.

2. Secure Financing Early On

If you don’t have access to capital or don’t want to use your own funds, securing financing early on is key. Whether it’s taking out a loan, talking to an accountant, applying for grants or even crowdfunding, having the right funding can make all the difference in getting your business off the ground. Make sure that you research all of your options before making any decisions – this will help ensure that you get the best deal possible!

3. Keep An Eye on Cash Flow

Cash flow is one of the most important aspects of running a successful business. Keeping an eye on cash flow means staying on top of invoices and payments from customers as well as keeping track of bills and other expenses that need to be paid in order to keep operations running smoothly. Setting up automated reminders or using an accounting software solution can help make this process easier – but ultimately it’s up to you as the business owner to monitor cash flow closely and stay ahead of any potential issues with payments or collections from customers.

4. Hire Professional Help When Needed

When it comes to managing finances, sometimes it pays (literally!) to hire professional help when needed. Hiring an accountant or bookkeeper can save time and money by ensuring that all paperwork is filed correctly, and all necessary tax documents are in order each year. Additionally, hiring professionals may also provide valuable advice related to cash flow management or other financial matters that can help keep your business on track financially over time!

With these four simple tips in mind, managing your finances as a small business owner doesn’t have to be so daunting! By creating a budget and tracking expenses regularly, securing financing early on if needed, monitoring cash flow closely, and hiring professional help when necessary- you’ll be well on your way towards a successful small business with healthy financials.

Overcome Upcoming Economic Obstacles: How Inflation Affects Millennials & Gen Z

Accountant, Accounting

The current state of the US economy has Millennials and Gen Z dealing with rising prices comparable to the days of Pearl Harbor, the Korean war and Watergate. Inflation has divided generations, giving each a different quality of life. In 1968, the U.S Federal Government had a minimum wage set at $1.60 which is the equivalent of $11.53 in 2019 dollars when it comes to purchasing power. In 2022, some states are still paying just $9 minimum wage which doesn’t give the current generations much flexibility, especially in the vehicle and housing market industry. In order to amount to the standard of living baby boomers experienced, millennials and Gen Z will need to make a minimum of $25 hourly if they plan on being homeowners without carrying major debt around. Although, with smart spending and saving, as well as keeping an eye on the economy, the younger generations have a chance to achieve the lives they desire.

Consider Not Ordering Take-Out Food.

Cooking from home and planning your meals will save you an immense amount of cash. Using apps such as DoorDash and UberEATS adds up quickly – start budgeting for groceries and stick to your list.

Look Into Receiving Help When Filing Your Taxes.

With professional assistance, you could be saving yourself tons of money this upcoming tax season. Organizing your income with an accountant can assist you in finding strategies you may be unaware of on your own. Tax laws change yearly and it is hard for the average person to stay up to date. An accountant can help identify new deductions that may be available to you. This could potentially reduce your tax liability and increase possible refunds from the IRS.

Spend Wisely.

Avoid using credit cards if possible. This is another top reason why Americans remain in debt. There are other ways to build your credit such as asking a family member to add your name onto the electric bill for a few months or using your credit cards for specific things such as gas and then paying it off immediately. Consider buying used cars locally rather than a dealership.

Have a Cushion Built for Yourself Before Making Big Purchases.

If your security deposit is $1,200, and your rent is $1,200, then you need to pay $2,400 upfront and if that’s all you have in your account, you’re setting yourself up for failure. Having nothing in your account will make it remarkably difficult to cover emergencies or basic life needs. Creating a nest for yourself will likely lead to a more permanent comfortable lifestyle and you won’t have to constantly be catching up with expenses.

Bookkeeping Basics: Determining Your Accounting Method

Accountant, Accounting, Bookkeeping, Business Expenses, CPA, Small Business, Taxes

When you start a new business, you have to make a decision regarding how you will approach your financial management. Two basic methods are available to you: cash basis or accrual basis. Although the two methods clash, there are also see some similarities.

Cash basis is an accounting method that counts income only after cash or a check is received and expenses are not counted until they have been paid. This method is the most popular accounting method among entrepreneurs and small businesses.

Accrual basis is an accounting method that counts income when orders are placed or services are requested, regardless of payment being received. Expenses are counted when your request for good or services is fulfilled.

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5 Strategies to Help Small Businesses Cope with Inflation

Accountant, Accounting, Small Business

Small businesses are the lifeblood of the American economy. They create jobs and drive innovation, however, inflation hitting a 40-year record high in June is having a significant impact on them. Prices for goods and services have been going up, while profits have been staying flat or even declining, making it increasingly difficult for small businesses to stay afloat. A recent survey by the National Federation of Independent Businesses (NFIB) found that 37% of small business owners reported that inflation was their single most important problem in operating their business. The good news is that there are steps business owners can take that may help your company weather the storm. Consider using these strategies to ease the effect of inflation on your small business. With inflation on the rise, small businesses need to take steps to protect their bottom line. Discover five strategies that can help ease the effect of inflation on your small business.

1. Cut Expenses Where Possible

Take a close look at your business and see where you can reduce costs. There may be unnecessary products or services that you are paying for that aren’t being used or alternative options that are less expensive. Consider switching to a hybrid or fully remote office model to reduce costs on office space. You can also try and negotiate better deals with suppliers by preordering materials or buying in bulk.

2. Diversify Your Revenue Streams

Look into other avenues to generate revenue for your business. Diversifying your revenue streams helps keep your cash flow moving. When one part of your business takes a hit, another part can pick up the slack. Consider entering the ecommerce space or offering a subscription service.

3. Automate and Streamline Processes

With climbing labor costs, one of the best ways to cut expenses is to automate as much of your everyday labor as possible. From customer service to social media, there are many software tools that can help automate tedious tasks. Automation enhances your efficiency while cutting down on mistakes, saving time for everyone involved.

4. Rework Your Pricing

Raising prices is never an ideal situation, however, it may be helpful in tackling the effect inflation is having on your business. Avoid a dramatic across-the-board price increase. Instead, analyze specific problem areas and raise prices accordingly. Transparency is key. Customers will accept a higher price on your goods or services and remain loyal customers if you are up-front with them about what’s going on.

5. Revisit Product Offerings

To make your business more profitable, you need to focus on products and services with strong demand and healthy margins. Consider eliminating poor performing products from your portfolio so you can put more time towards goods and services that make your business money.

Inflation can be a challenge for any business, but especially small businesses. However, there are steps you can take to help mitigate the effects of inflation and maintain your profitability.

Don’t let inflation get you down. Motl Accounting can help you develop a plan to manage inflation and keep your business thriving. Contact us today for help staying ahead of the curve.

5 Things to Consider When Choosing an Accountant

Accounting

Accountants aren’t just for big companies. Hiring an accountant for your small business can provide valuable insight about your company’s financial position helping you make more informed decisions about how to grow your business. A good accountant can be your company’s financial partner for life, so when choosing an accountant there are many factors to consider.

Know Your Needs

The first step in choosing an accountant is to identify what you want the accountant to do for you. Are you looking for someone to handle bookkeeping and financial services or help you prepare and file your taxes? Are you needing day-to-day accounting or just someone who will work for you periodically? Understanding the responsibilities and work you need help with, and how often, is an important step toward finding the right accountant.

Experience

Make sure to check their qualifications. It may be beneficial to look for a financial professional who has experience working in your industry so you can be sure the accountant has a real understanding of what your business is about. The right background will be especially beneficial for tax preparation.

Check Fees

Ask about fees upfront as this can potentially save you thousands of dollars. Some accounting firms charge by the hour whereas others work on a monthly retainer. Determine your needs and decide on an accountant that fits into your business’s budget.

Accessibility

A great accountant is your financial advisor all year round, not just at tax time. They are there to support you and your business whenever needed. Find out if you will work directly with the accountant or if other employees will handle your books. It’s also important to know from who and how quickly you can expect a response to inquiries.

Business Growth

The best accountants will share ideas about processes that could be implemented to help your business succeed. Any accountant will let you know about potential issues, but a great accountant will recommend when it’s a smart time to open another location, hire an employee or purchase new equipment. Be sure the financial professional you choose will ultimately support, contribute and guide your business growth.

The Bottom Line

Choosing an accountant is one of the most important decisions you will make for your business. After all, they can play a pivotal role in its success or failure. A good accountant will help you achieve your goals and set your business up for long-term success. By taking the time to research different accountants and asking the right questions, you can feel confident that you will make the best decision for your business.

Let’s Work Together! If you’re looking for a corporate accountant in the Chicagoland area, Motl Accounting has the expertise you need.

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