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What You Need to Know About Tax Reviews

By Randall Orser | Personal Income Tax

Today, Canada Revenue Agency (CRA) is doing more “reviews” than audits these days, though, let’s face it, it’s just a fancy new name for audit. CRA would have you believe that these reviews are just them ensuring that you’re paying your fair share of taxes, though that doesn’t make it any less stressful for you. Most taxpayers won’t have to worry about a tax review, however, if you are one of those worrying about such a review, here are some tips to make it a smoother process.

Tax Preparation

If you maintain accurate records over the year, your tax review should run smoothly, or you may avoid one completely. By keeping good records, you have ready access to the information you need to complete your tax return. Rather than putting it off until the end of the year, or worse, when you’re doing your taxes, keep pertinent receipts and documents in some kind of file, envelope, etc. By keeping them handy and in the same place, you won’t forget items that should go on your tax return.

Red Flags for Audit

There’s certain things that are more than likely to trigger a review than others; CRA also has years where it looks at certain things over others. By paying attention to what you are doing, you should be able to avoid some of these things:

  • Incomplete tax forms
  • Incorrect SIN for yourself or a dependent
  • Information that doesn’t match your T-slips (T4, T5, T3, etc.).
  • Large amounts for deductions in comparison to your income
  • Consistent large business losses year over year
  • Using non-standard deductions
  • Unusual deductions that you’ve not taken before
  • Listing dependents other than children, parents or grandparents
  • Large amount of medical expenses or donations

You probably won’t have to go through a tax review every year, it can happen. Sometimes it can be as straightforward as remembering to follow the guidelines for completing your tax return, schedules, or to include certain types of expenditures or income. If you want to avoid a review then just complete your return as accurately as possible and keep your documents.

Myths about Freelance Freedom

By Randall Orser | Small Business

You’ve thought about being your own boss for some time. You’re tired of working for someone else and want to dictate your own schedule by your own rules and experience the freedom of being self-employed. Don’t quit your day job just yet and set off down the path of self-determination. You need to understand that freelancing isn’t as liberating as you might think. Here are four things to think about before you launch that freelance career.

Flexibility is Not All It’s cracked up to Be

While there is a possibility of a flexible time schedule as a freelancer, the opposite tends to true. Instead of that flexible schedule, you’re more likely to be troubled with thoughts of “I should be earning right now”. You may have thought the freelancer life would be your personal freedom, it may end up being a life of guilt knowing that every moment you’re not working is a moment not earning. 

Less Stress is a Falsehood

A stress-free life as a freelancer is ahead for you, correct? Nope, you need to give your head a shake. You end up trading one type of stress for another. Your stress isn’t coming from your boss or colleagues anymore, but from self-imposed stress of always being on the lookout for new clients. Knowing that your income could come to a screeching stop with the loss of a client or two can make you feel like you can’t ever rest. You’re always in marketing mode with the anticipation of getting new clients to your freelance business.

Different Boss, Same Game

You’re thought about and have looked forward to be your own boss. Except you’re really not your own boss, your clients become your boss. And, unlike before where you only had the one boss to contend with, you now have many bosses to which you need to answer and make happy. If the thought of being pulled in many directions at the same time doesn’t delight you, then you need to think long and hard before you take on the freelancer thing full time.

Work from Anywhere, Work from Nowhere

Becoming a digital nomad is a big thing now and can be appealing. As long as you have internet access, you can work from anywhere. Regrettably, you may find out that you really work better in an office environment without distractions. The problem with so many places, such as your local coffee shop, is too much noise, too many interruptions, and too many dirty looks from servers can make you want to retreat to a quieter location. A poor internet connection (or none at all) can thwart your plans of working from the beach. In the end, you’ll probably end up working from home instead of exploring your opportunities as a digital nomad.

You need to check yourself before launching your freelance career that your romanticizing the benefits of freelancing. The freedom is always nice at the start, but you’ll probably end up feeling numerous pressures once you realize how you are completely on your own. There many challenges to think about from revenue generation, to retirement planning and medical/dental benefits as a freelancer. The sooner you realize these self-employment truths, the better prepared you will be to develop solutions.

How to Use Your Tax Refund

By Randall Orser | Personal Income Tax

The height of tax season is here, and many Canadian taxpayers are preparing to get large refund cheques. The average Canadian tax refund is about $1,400. Have you filed your tax return yet? Here’s eleven best uses in order to maximize that tax refund.

Pay Off Debt

If you’re finding yourself in debt for credit cards or student loans, it can make your life miserable. If you’re debt load has gotten out of hand, that’s especially true. You can wipe out financial stress and anxiety by using your tax refund to pay down this onerous debt.

Save Your Money

Do you have enough set aside for emergencies? Canadians barely have $1,000 set aside for such expenses. Use your tax refund to start your saving for a rainy-day fund, particularly if you have a difficult time saving.

Take a Vacation

Have you been thinking about that dream vacation, such as a cruise or a European trip? Your tax refund can make that a reality. Your tax refund may not be enough to pay for the whole trip, however, you can probably make a sizable down payment on that dream vacation.

Investing

It’s never been easier than today to start investing. The best part is that you don’t have to pay a broker. You can learn about investing online and create a self-managed account that will allow you to buy and sell stocks any time. 

Put Money into Your RRSP

The perfect time to start your RRSP is now. Even if you’re young, you should make decisions today that will benefit your future. Funding your retirement account takes discipline and consistency. When it comes to your retirement, you’ll be very happy you made the effort now.

Spruce Up Your Home

Does your home need a bit of a makeover? There are economical things you can do to your home to improve it. You can paint, plant a garden, or buy new furniture. With small improvements you can enhance the look and feel of your home.

Start a Business

A smart way to use your money is to start a business. You could quite possible make your dreams a reality, but also create an additional stream of revenue for your family.

Fund Home or Auto Repairs

Have you been putting off any home or auto repairs? That tax refund could go to new brakes, a tune up, broken window, or replace missing roof shingles.

Update Your Work Wardrobe

You’re not Steve Jobs so you probably can’t get away with wearing the same thing every day. Nor do you have to look like a fashion model. You should have clothes that are professional, if you want to advance in your company, you should be paying attention to your professional image. You can use your refund to buy new shoes, dresses, suits, and business casual attire.

Start a College Fund for Your Kids

College is expensive, and the average college student ends up with tens of thousands of student loans. For someone who’s just entering the workforce, that’s a lot of debt. You can make your kids’ graduation a happier time, if you save a portion of your tax refund for them.

Treat Yourself

While it’s important to pay off debt or start a savings account, you should maybe enjoy some of the finer things in life your money can buy. Treat yourself to something special you’ve always wanted with your tax refund. Be it a new fragrance or handbag, buy something that’ll put a smile on your face.

Your tax refund could change your financial picture. It’s crucial that you spend it wisely.

Are You Following These Five Entrepreneur Rules Religiously?

By Randall Orser | Small Business

Entrepreneurship is erratic and unpredictable, so rules are crucial. Rules give you a groundwork to work from, that will serve as a guide for when the optimal direction seems uncertain. Your first step to be a successful entrepreneur is figuring out and remember those rules. Here are five rules worth remembering.

Tools

Every business needs tools of some sort. Whether it’s rows of machines, or just a single computer. No matter what technology you are using, it’s absolutely important to keep them well maintained. Actually, maintaining what you have now may be more important and feasible than struggling to get top-of-the-line equipment.

You can keep replacement costs down by maintaining equipment, which leaves revenues free for other important expenses. Being vigil on maintaining your equipment lowers breakdowns keeping productivity high. Of course, that’s not just physical maintenance. It’s also keeping your hard drive free of files you no longer need, so you aren’t buying new hard drives.

Business Before Emotion

As an entrepreneur, your passions and desires matter. They keep you going when you’re tired and facing mountains of work ahead. Sadly, too many startups fail because the leader confuses passion for intelligence.

Passion is important; however, it should never determine how you run the business. Passion is the “why” of your business. It brings you to the office and drives you forward. When it comes to actually making decisions, you need to let the numbers and your head do the work.

It’s not just passion that can be a problem. Entrepreneurship is naturally stressful, and there are lots of times where your buttons get pushed, sparking sadness, anger, joy, and more. These emotions can push you into making decisions in the heat of the moment, which is dangerous. Positive emotions are just as dangerous. Using joy to make a decision is just as bad as giving in to anger. In the end, you’re making a decision that wasn’t made through careful thought.

Partner only with People Who You Trust

For a lot of startups, taking on a partner may be unavoidable. You are only one person no matter how brilliant you are as an entrepreneur. You’re only able to do so much, and you may only be able to afford to delegate so much. You may need more authority than an average employee for certain things, and that authority may need to be equal to your own. Some things just need a partner.

However, don’t just let anyone be your partner. You want to fill in the gaps of your skillset to increase value, however, they need to be trustworthy. After all, you’re sharing the reins with this partner. If you can’t trust them to have the same goals as you, then they don’t deserve tht power and responsibility.

Preparation

Entrepreneurship isn’t something that lends itself to improvisation. Products and sales don’t just magically appear because you did something on the fly. They happened as you were prepared for them. You determined your target market and what they wanted out of your offering and focused on developing towards those needs.

Not sure what to do next or you’ve somehow managed to clear your to-do list, prepare. Something is always coming up that needs attention and need to figure out and study. This could be a direction the market is going, or negotiations. Figure out for what you need to prepare, and get ready.

Take Care of Yourself

Do you want to be one of those entrepreneurs who pushed themselves to death? Many have, literally in order to develop a successful business. Many have worked long hours, gave up everything, such as friends and basic hygiene, in order to turn a profit. Sadly, that route usually doesn’t pay off, and, if it does, it’s a costly victory.

You are your most important responsibility. You’re not there for the sake of your business, your business is there to help reach your goals. All the money in the world is pointless if you sacrifice your health and well-being for it.

Entrepreneurship can be confusing, however, having a core set of rules will keep you grounded and going in the right way. The above rules are not the only ones you’ll need, most will come from experience, but these will get you started.

Before You File Yourself, Here’s Some Tips

By Randall Orser | Personal Income Tax

It’s tax time, and that dreaded chore of filing your taxes is weighing on your mind. Do you do it again this year yourself? Filing your taxes is more than just about your T4 or RRSP, there are other deductions you should think about, and some depending on the Province you live in. And, do you file online (preferable) or via paper (takes weeks to get processed and to get your refund)?

Online or Paper Filing

In 2017, 22 million or 90% of income tax filers used online filing and will probably grow to closer to 100% within a couple of years. Even returns for deceased people can now be filed online. Online filing is fast and secure, and generally your return is processed within 8 business days, and you’re refund sent within that time. For faster refunds, use direct deposit.

There usually is no requirement to paper file your taxes anymore, except maybe for someone who’s deceased or a non-resident. If you choose to file via paper, then you need to realize it can take up to 6 weeks to process your return and get your refund cheque.

It makes absolutely no sense to file via paper anymore.

Slips and Receipts

You need to gather up all your T-slips (T3, T4, T4A, T5, etc.), RRSPs, donations, medical expenses, etc. 

Here are some other things to consider:

  • Do you have kids? 
  • Did they go to post-secondary school?
  • Do you have the T2202A?
  • You can only claim the tuition
  • For BC, did they do arts or sports?
  • Do you have the official receipts from the organization?
  • Did you go to school?
  • If you did, then you need a T2202A from the post-secondary institution
  • Did you sell your home?
  • Gather all your documents for your original purchase and the sale of the home.
  • Do you have foreign income?
  • This could be investments you have outside Canada that aren’t on a T-slip.
  • Do you get a pension from a foreign government? US? UK?
  • Do you have investments outside retirement accounts?
  • Did you get a T5008 show shares you disposed of during the year?
  • You need to find out the cost of those shares; talk to your financial planner.
  • Are you or a child disable?
  • Did you file for the Disability Tax Credit (T2201A)?
  • You must have a T2201A on file with CRA in order to claim the disability tax credit.
  • your Social Insurance Number, as well as your spouse’s and children’s.
  • your birthdate, as well as your spouse’s and children’s. 
  • If you’re carrying forward from last year, ensure your address and email are correct.

You may want to:

  • Sign up for direct deposit to receive your refund faster and any benefit or credit payments owed to you, deposited directly into your bank account. Go to www.cra.gc.ca/directdeposit to learn how to sign up for direct deposit.
  • Make sure the Canada Revenue Agency (CRA) has your updated address and direct deposit information before you file. The fastest way to update both is by using My Account. To register for My Account, go to www.cra.gc.ca/myaccount. You can also use this service later to view your tax slip information, look up your RRSP deduction limit, and check the status of your refund or your Canada child tax benefit or GST/HST credit payments.
  • To file online, you need to complete your return using certified software or a certified web application. This may even help you identify benefits and credits that you may have missed if you filed on paper! The CRA has a list of software options-some that you have to buy and some that you can use for free-at www.netfile.gc.ca/software.

When Should You Turn Down a Client

By Randall Orser | Small Business

You’ve started our business and it can be tempting to take on every client that comes along. After all, without your clients then you won’t have revenue which your business greatly needs to prosper. So, while on paper it makes sent to take one and all clients, regrettably, frequently that client is more trouble than they’re worth. Is this client a good fit with you and your business? Sometimes it’s not and it’s best if you both just move on.

Clients in a Rush

You’ve worked hard on creating the most productive processes during the development phase of your business. You’ve got the right mix of cost, speed, and quality together. You don’t want to mess with that formula, however, that client in a rush will definitely mess that mix up. The rush client is one of those that phones you just before closing on a Friday, and wants a job done by Monday morning. Avoid the rush client that wants you to work entirely with their schedule. You know what you’re capable of and how fast, so if it’s not possible, then don’t do it. In the end you damage your brand by taking on the rush client as you know they’ll never be satisfied.

The Mundane Job

Not all your jobs will be exciting or glamourous. Your clients can project their enthusiasm for the details, or job, onto you and get you excited for the job. However, there are going to be those tasks that just bore you, and you should avoid those as much as you can. Boring jobs just suck the life out of you and your work, which can upset the quality and your enthusiasm for the business in general. If you want to take on that boring job, then either recommend it to a colleague or someone else in your company, so the client doesn’t leave empty handed.

Not Paying Enough

The most difficult thing you’ll do for your business is come up with pricing for your offering. You have to find a price that’s profitable, but at the same time one that fits your target market. This will require a bit of work but totally worth it in the end.

Whenever you get that customer that wants a discount, you need to just turn them down. You should also turn down those clients that want something difficult or special that you don’t usually offer. You’ve come up with your price for a reason, as it’s what you believe your offering is worth. Stick to your guns when it comes to pricing and insist on the posted price. And, for Pete’s sake, avoid those clients that go on about giving you exposure for a discount, or worse, a freebie.

Your Time is Limited

You only have so many hours in a week to do client work. There may be a time where you just can’t take on a client, even when that client is not in a rush. No time is a good problem to have as it means you’ve gotten to capacity. You may be thinking it’s easy to ignore that new client, until you think about the money it could bring. Don’t take on more than you can handle, unless you’re just backed into a corner, you’re better off to err on the side of caution.

Outside Your Niche

Have you been asked to do something that’s outside your niche? It’s great that people think you’re capable of doing great things, however it could backfire. You have the chance to expand your offerings and learn something new. However, you may not do it at all well, which could affect future business. The best time to expand is when you decide to do so, not when a client asks. You need to focus on what you’re great at and what you’ve designed the company to offer.

Just Feels Wrong

Measurable metrics is what your business revolves around. Getting to your final cost for your offering is a composite of manufacturing expenses and the target market’s average income. However, there’s something to be said for your gut feeling If you’re just not sure about the client, or what they’re asking, don’t hesitate to say no. You’re much better off to lose a client than be forced into things you never wanted to do.

The above usually apply to small businesses that have a small number of clients, however, you can apply them to businesses that sell products as well. The important thing is that you value your time, your effort, and your business. Anytime a client asks you to compromise one or more of them, it’s time to move on.

Paying Your 2017 Taxes Owing

By Randall Orser | Personal Income Tax

Tax time is once again upon us, and the chore of preparing and paying your taxes is nigh. Remember that the due date for paying your taxes is April 30th. If you don’t file by then, you will get a penalty of 5% plus 1% per month (up to 12 months) you don’t file. Sadly, many people don’t pay because they think they are going to owe, and that’s a big mistake. You’re much better to file your taxes and then work out a payment plan with Canada Revenue Agency (CRA). When filing your return, you may have a balance owing on line 485. Generally, if this amount is $2 or less for 2017, you do not have to make a payment.

Ways to Pay Your Taxes

You can pay in various ways to CRA: 

  • You can wait for your notice of assessment and then pay at your bank. 
  • You can pay using online banking (your SIN is your account number). Note many banks date the payment for the next day if it’s after 3 pm EST).
    • You can also post-date your payment to April 30th or any other date before that.
  • You can us My Account and pay that way and date the payment for anytime before April 30th.
  • You can pay at a Canada Post outlet, though payment make take a couple of days to be processed.
  • If you’re using a tax preparer, they can setup auto withdrawal and you pick the date (before April 30th) for the payment to come out.

What If I Can’t Pay in Full

If you cannot pay the full amount you owe now, take action by contacting the Canada Revenue Agency (CRA) right away. Ignoring your debt does not make it go away. In fact, waiting may make any financial or legal consequences more serious. The CRA may also charge interest compounded daily at the prescribed rate on any amount owing until your balance is paid in full. The CRA will work with you to resolve your tax debt or other government programs debt, though they could change their minds and demand payment in full at any time. 

A payment arrangement is an agreement you make with the CRA. It allows you to make smaller payments over time until you have paid your entire debt including applicable interest. Before you make a payment arrangement, you may need to show that you have tried to pay your debt in full by borrowing money or reducing your expenses. To figure out your ability to pay, we may ask you to provide proof of your income, expenses, assets, and liabilities. You may have to do this by telephone or by completing a financial questionnaire. The Payment Arrangement Calculator lets you calculate payment options and it includes the prescribed Canada Revenue Agency interest rates. The Income and Expense Worksheet will help you to calculate your available net income to pay your debt.

Financial hardship provisions

If your debt repayment makes it difficult for you to pay for housing, food, utilities and other necessities of life, you may qualify for help under the financial hardship provisions.

It is your responsibility to contact the CRA if repaying your debt is causing you financial hardship. The CRA will take your situation into account when reviewing your request.

For more information and to see if you qualify, call 1-866-864-5823

Insolvency or bankruptcy

If you feel you are insolvent or are considering bankruptcy, visit the Office of the Superintendent of Bankruptcy for more information.

Taxpayer relief provisions for individuals

In some circumstances, you may be able to ask for relief from penalties and interest charges and reduce the overall amount you or your business owes. For more information, and to see if your situation qualifies, see Taxpayer relief provisions.


In the end, you need to file your taxes and ensure you pay in full by April 30th. If you find yourself unable to make a full payment, file your taxes and then contact CRA to make a payment arrangement. 

Get Your Business Moving in the Right Direction

By Randall Orser | Small Business

Business development requires one of the most overlooked and important aspects, direction. How many businesses seem to fail even though they seem to have everything going for them? You can have a talented team, a great product or service, however if the business isn’t pointed in the right direction it’s going to fail.

It may sound simple, but many businesses seem to miss it. No matter if it’s a mom and pop shop or a Fortune 500 company, by not aligning all the businesses parts it’s going to be a disaster. From personnel to marketing, you need to ensure all parts of your business are focused on accomplishing the same goals. Ideally, you should be aligning those goals with the wants and needs of your customers.

Are your businesses parts all moving in the same direction? How do you do that?

People

Direction is the difference between a team that’s greater than the sum of its parts, or a disorganized and disappointing group. 

Your worst-case scenario is where your talented people are going in opposite directions and cancelling our each other’s efforts. That said, the worst-case scenario doesn’t have to exist for a lack of direction to hinder your company’s performance. 

If your people are going off in different directions, then you’re getting less than ideal results across the board. To ensure peak potential of your team everyone needs to have the identical goals in mind.

You must be communicating all the time to achieve this. Have a crystal-clear idea of what your businesses priorities are. And, being receptive to feedback is important.

Departments

You can scale direction for any company size. And, that direction needs to be on point for every department in your business. 

To that point, envision a company with each department full of talented people but missing common direction. Your marketing department is putting out great materials aimed at the 18 to 30 demographics, however, your R&D team is producing a product aimed squarely at retirees. While your sales department is focusing on getting the product stocked in stores which are most popular with new parents and young families.

The above is an extreme example; however, many businesses end up in a similarly harmful pattern of misalignment. Your business needs to have clear organization goals that all departments are aware in order to flourish.

The most successful brands in any industry create a great product and then create a marketing campaign that reflects the product in a way that appeals to the targeted demographic. And, available in places that demographic is mostly likely to check.

However, it’s all pointless unless the company is pointing in the same direction as its customers.

Customers

You can make the best product, or provide the best service ever, but that’s pointless if no one wants to buy it. A restaurant with an incredible effective marketing campaign targeting twentysomethings will have no sway in a community mostly made up of retirees.

Your businesses success hinges on aligning your goals and priorities with those of your customers. Unless you do that then no amount of effort is going to make your product or service successful.

Successful brands know their customers and provide them with what they demand. If you look at history’s biggest successes, you’ll find that they aligned perfectly with their target demographic. The failures are the ones that had a complete misunderstanding of this.

A great example of this is New Coke, remember that? This fiasco tanked the world’s most popular soft drink sales back in the 1980s. Coca-Cola’s various departments worked in perfect harmony to create the new recipe and market it to the masses, which was great; however, this wasn’t a direction its customers wanted Coke to be moving. Coca-Cola was a popular drink everyone recognized by its taste since childhood. Coca-Cola went against everything its customers wanted by changing the taste; especially one that was kind of gross.

The Takeaway

You need to be creating clear goals for your business and ensure those are reflected at every level. Your staff need to understand your company’s goals whatever their position in the company. Without everyone understanding that your most talented people may end up working against you.

It’s imperative that these efforts are aligned with the goals and expectations of your customers.

Your First Tax Return

By Randall Orser | Personal Income Tax

Filing a tax return for many people can be overwhelming, however it can feel especially difficult when you’re young filing your first return. You must file a tax return if you’ve earned income during the year, or are entitled to any credits, such as the GST/HST credit, or may be getting a refund. The following tips will help make your transition into adulthood much less stressful.

Collect Your Tax Documents

Any company you worked for during the year should send you a T4 stating the income you earned, and the income tax, CPP and EI deducted. Whether you worked one day or the entire year, if you didn’t get a T4 by mid-March then you need to go back to your employers and find out why. Did you move during the year? If so, you should’ve let all employers know. If you were self-employed, you may or may not get a T4A, so keep track of any self-employed income you made during the year.

Ensure that you have all your financial documents for the year in one folder and keep those safe until you’re ready to prepare your tax return.

Dependent College Students

You tax situation could get a bit harder if you’re a college student, and your parents support you as well. Your parents can claim you as an independent and claim part of your tuition on their taxes, they’re paying for it anyway. You can claim what you need to on your taxes, however, you can transfer (up to $5,000) to them as a deduction on their taxes. Your parents more than likely have the higher income, so it makes sense for them to get the deduction. You need to talk to your parents about your intentions before anyone files their taxes.

File Electronically and use Direct Deposit

Canada Revenue Agency prefers you to file electronically (Efile®) and use direct deposit. Returns that use Efile® get processed much faster than via paper, and direct deposit is way faster than getting a cheque. If you Efile® and use direct deposit you can have your refund within 10 business days as opposed to paper and cheque which can take up to 8 weeks. Depending on the complexity of your tax return, you may have to buy tax software to do this or hire someone to do it; the investment is usually worth the time savings. The advantage to using software or a tax preparer is that they may uncover deductions you didn’t realize were possible.

There really is no reason to file a paper return anymore, unless you’re required by CRA.

File by April 30th.

You need to file and pay by April 30th for the preceding tax year. If you Efile® ensure you file by midnight on April 30th to avoid a penalty. For paper filing, the postmark must be for April 30th, otherwise, it’s considered late. If April 30th falls on the weekend then the due date becomes the following business date, usually Monday. CRA does not give extensions for filing, other than for self-employed individuals of June 15th; if you owe then it must be paid by April 30th. You should file your return on time even if you can’t pay the balance owing right away. CRA charges a penalty of 5% plus 1% per month up to 12 months that a return is past due.

Filing your taxes is not the most enjoyable process, but don’t rush it as you could make careless mistakes. This could cost you in missed refund opportunities, penalties, or other attention from CRA you don’t want. As this is your first time filing, you may want to have a parent or other older adult look over your return, especially if you’re not using software or a tax preparer.

Build a Sound Financial Business Strategy

By Randall Orser | Small Business

Are you an entrepreneur seeking to build your company? Or someone thinking about opening a new business? To be a successful business builder the best thing you can do is focus on your company’s finances. Be the entrepreneur that focuses on the finances of the company rather than the one going to the tech conferences or inviting the media hoping to get exposure. Do you want your company to fail because you weren’t aware of its fiscal responsibilities? Keep the following sound financial business strategies in mind and you’ll have a successful business.

Learn Business Finances

To improve growth opportunities for your company, then focus on learning as much as you can about business finance. In the time other new business owners are going after media attention, you should focus on refining your business finance expertise. By learning more about business finances from experienced people, like Warren Buffett or someone in your industry, the more able you can leverage growth opportunities others might miss.

Economic Trends

By watching economic trends over various business verticals, you can ensure you’re best prepared to handle financial risks. Focusing too much on your own market sector can make you miss impending market shifts that can affect your growth rate. From trends in retail to how automation is changing business development in global markets, the opportunities are many to understand future economic trends. Gather all the information possible on global economic forecasts and ensure you’re looking years ahead, not just months.

Changing Rapidly

Business finance these days is rapidly changing. The norm used to be bank loans and venture capital, now the options have expanded and becoming more common are cryptocurrencies and ICOs (initial coin offerings). You need to understand how business finance is transforming as technology advances, if you want to ensure you’re in a good place financially.

Chief Financial Officer

A Chief Financial Officer (CFO) can be a smart in-house hire for your startup in order to secure your businesses financial strategy. Too many startups wait until far too late to look at their company’s long-term finances. Whether it’s an accelerated burn rate that is unsustainable or business expenses that can’t be recovered in an acceptable amount of time, a CFO helps keep your company out of trouble and on the path towards profits.

Spending Habits

Are you watching your competitors’ spending habits more than your own spending patterns? That’s not very productive at all. You’re much better focusing on growth elements you control, rather than on what your competitors are doing. Whether it’s expenses on talent, fees paid for services you use, keeping an eye on your own finances and looking for increased opportunities is much more productive.

Financial Technology Tools

Thanks to rapid growth in the fintech sector, financial technology tools have grown significantly and available to entrepreneurs. You need to pay attention to this sector to discover savings opportunities you might not even know exist. Technology is changing the resources to which you have access to handle your businesses finances, however, you do need to know that they exist. A core component of your business’ financial strategy should be looking at the fintech sector regularly.

Spending for Spending sake

Too many new companies fall into the trap of spending for spending sake when they get the investor funding. That cash injection is great for stimulating growth, however, spend it on things that have a high ROI (return on investment). You should be spending on marketing, or hiring someone to do it, or a sales person that can close business deals, those are much better options. You need to ensure you’re maximizing that influx of cash so spend wisely.

Business Consultants

Any business consultant you hire should be driving for revenue generation. Far too many young businesses double-down on business consultants outlays rather than bringing on someone internally. That internal person is much more likely to put your businesses interests first as they have skin in the game. The consultant on the other hand is juggling many clients so your business’ growth is not their first priority. Analyze how much you’re spending on consultants with other expenditures to ensure your costs aren’t atypical.

Accounting Team

As part of your business financial strategy, the most prudent on is to hire a top-notch accounting team, accountant and bookkeeper. You want an accountant that doesn’t waste your money on just looking for loopholes, but one that finds the tax savings that are the best long-term advantages for your company. A smart accountant can help grow your business in ways you never envisioned.

Big Isn’t Always Better

The old adage big isn’t always better is one many entrepreneurs overlook. The obsession of tech media with funding news from angel investors and venture capitalists skewed impressions among entrepreneurs. Too many entrepreneurs focus on acquiring outside funding rather than smaller, bootstrapped growth which may end up being more profitable. There is a fallacy of growth at any cost, don’t fall for it, as you may be happier and more fulfilled if you built a smaller business without any outside funding.

Remember the above strategies and your odds of building a financially-sound business increase. Put your effort into building a foundation that is fiscally sound, and the likelier you’ll be proud of your business. You’ll never regret spending your time on making smart financial decisions for your business, and your business will grow as a result.