Dec 11, 2019
Welcome back to Grow Money Business Podcast with Grant Bledsoe. Today we have a solo episode and Grant is here to talk about cash flow. Cash flow related issues are very common among business owners and it’s something Grant hears about over and over again from clients, prospective clients and people in general.
If you are a business owner, at some point in your business journey you probably have come across one of those moments when your business is going really well, generating revenue and reaching growth targets but you don’t have a clear idea of how much to pull out of your business and pay yourself. This is where you’ll need a better way to manage your cash flow and know how much you’re making. So, in today’s episode Grant shares a framework that he uses to help his clients think about this.
[01:53] Keep track of your revenues and expenses – Grant explains why you should make use of modern tools for bookkeeping.
[02:38] Dedicated bank account for business transactions – It’s not mandatory but it’ll make your life a lot easier.
[04:29] Taxation and business entity types – Grant describes how taxes come in to play for different business entities; Sole proprietorships, LLCs, S-Corps, C-Corps.
[09:43] How much cash to keep in your business - Grant shares a few tricks about deciding how much cash you should keep in your business bank account.
[16:15] Managing savings – How to balance savings for short term and long term goals and keeping a cash reserve for a rainy day.
[21:15] Investment options – Grant talks about a few ways you can invest your profits including CDs, Mutual Funds, and how taxes come in to play when you invest.
[32:30] Hierarchy of incoming cash – Grant shares his wisdom on how to prioritize what to do with your money when you’re having a good month.
Links & Resources
Business Structures : irs.gov
Certificate of Deposit (CD): bit.ly/36lwUBA
Mutual Funds: bit.ly/2RCivgm
QuickBooks Accounting Software: quickbooks.intuit.com
FreshBooks: freshbooks.com