Each year there is a new gadget or tool for businesses that make it that much easier to start and run your own biz (*ChatGPT cough, cough*). There’s a tool popping up what feels like every week for things like design, copy, and automation. 

And while I’m all for working smarter, not harder, I think we, as a whole, forget that there are also a lot of great financial tools for small businesses. 

Most people don’t realize that they’re overlooking this. But you can’t start any venture, personal or business, without the right financial tools set in place. It’s crucial. 

So today, I am going to share some of the best financial tools to use so you can run a successful business — things I’ve vetted myself so you don’t have to! Because guess what? Finances don’t have to be a pain in the you-know-what.

https://youtu.be/m8exGxexTZ8

Accounting software

Drop the sticky notes and random journals. Accounting software makes it much, much easier to keep track of literally everything. Think programs like Quickbooks or Xero. 

You can keep tabs on financial transactions, including income, expenses, and taxes. And it’s all in one place, so it’s super simple to get the info you need in a snap. Plus, most of them will calculate things for you, so even if math isn’t your thing (hi, that’s me) then you’re covered, bb. 

But don’t just set it and forget it. Even if you one day grow out of these programs and decide to hire an accountant, you still need to be aware of what’s happening with your money. Otherwise, you can kiss it goodbye because you’ll be spending more than what you really have in the bank (speaking from experience).

Budgeting and forecasting tools

This kind of falls in line with the above, but make sure that you’re able to use a system that helps you keep track of your expenses, budget, AND forecast. This three-fold system is a great way to keep your finger on the pulse of what’s going down money-wise. 

And even if you don’t get paid software or hire an accountant, there are still a lot of great, free, resources out there where you can manually DIY it — like Google Sheets.

Moral of the story? Keep an eye on that money.

Payment processing tools

You want to get paid, right? Well, then you need some sort of payment processing tool, no matter what you’re selling. Think Stripe, Square, and Paypal. Some e-commerce sites, like Shopify, even have built-in systems that make it even easier to get paid. 

And when you land on the right one for you, make sure you’re aware of the fees associated with it. Most of them will be free to use but will take a small percentage of what you’re paid. It’s usually about 3%, which doesn’t sound like much but it adds up fast. 

That’s why it’s so important to know what’s going on with payment software. I go into mine every so often and check on any backend or policy updates. That may just be the attorney in me, but I don’t like being blindsided with my money. 

Forecasting

I used to just look at my profit and loss (P&L) statements and thought that was enough. I’d either be happy or sad depending on what I found and then go about my merry or not-so-merry way.

But then I figured out what forecasting was, and it was an absolute game changer. 

I started this with a bookkeeper I was working with last year, and they would look and see what I might be making over a few months. In fact, we were eventually able to look at the entire year.

And what did it show me? Whether or not I was on track to meet or fall behind my financial goals. I was able to see where there were wild swings in cash flow (launch time versus “off-season”). But as we forecasted, those swings evened out. 

Why? Because I was able to prep for the down months instead of looking at it like a big mystery, never really knowing what to expect — even though the data was there all along. 

This has easily been one of the most helpful financial decisions I have EVER made. 

Business credit monitoring services

Did you know that you can take out credit that’s in your biz name and NOT tied to your personal debt? Maybe you need money for equipment, or you’re going to be shilling out the big bucks on paid ads. Either way, having a business line of credit can be helpful when you need the money (and know you have the cash flow to pay it back). 

There are also services that can help you monitor your business credit score and protect your business from fraud, like Dun & Bradstreet.

Investing in passive income

Financial tools aren’t the only things you can invest in to grow your business. Over the last (almost) eight years, I’ve been a huge fan of using passive income to up your profit (without burning you out), mainly in the form of digital products. 

But that’s not the only way to do it. In the video below, I’m giving you three additional ways to diversify your income!