This has been a bit of a theme this week so I’m feeling it’s time to address it. It’s time to talk about minding your expenses.

Here’s the deal…

Running a business involves receiving income AND paying expenses. You don’t need an accounting degree to understand it at this basic level. If you’ve never owned your own business, it’s easy to be ignorant to the expense part of that. After all, when we’re paying people for things, we’re just aware that we’re giving them money. We’re able to stay blind to what business expenses must come out of the money we’re giving them.

Expenses will vary by business but here’s a list of some of what you may expect:

  • Accounting/bookkeeping, and financial consulting fees
  • Advertising expenses
  • Automobile expenses (only the percent that is used for business)
  • Bank service charges and fees
  • Books and periodicals
  • Business/trade conventions
  • Business gifts (annual limit of $25 per recipient)
  • Business meals (50% is deductible)
  • Coaching fees, if related to your business
  • Computer, printer, and software (if used over 50% for the business)
  • Consultant fees
  • Depreciation and amortization
  • Dues for professional and trade associations
  • Education expenses for maintaining or improving required skills
  • Email, Internet access, and web hosting services
  • Fax machine
  • Insurance expense
  • Legal and attorney fees
  • License fees and taxes
  • Merchant account or credit card processing fees
  • Office furniture and equipment
  • Office supplies
  • Online services used for the business
  • Parking and tolls
  • Postage and shipping
  • Printing and duplication
  • Self-employment taxes
  • State and local business taxes
  • Preparation of business tax return
  • Telephone expense (only for a separate business line)
  • Travel expenses
  • Vacation expense (meaning you’ll need to financially plan for having this time off.)
  • Sick day expense (meaning you’ll need to financially plan for having this time off.)

Taking it a step farther, you must understand that strong business owners get this and expect you to as well. If your ignorance around the financial aspects of your business is evident, you can lose clients or future business – no one wants to count on someone who is clearly flying by the seat of his or her pants. It’s just too risky.

Be a strong business owner who portrays professionalism. If you take your business seriously, others will too.