Following on from last week where were talked about streamlining your income, this week we are talking about streamlining your outgoings and smoothing out the peaks and troughs in your bank account.
In order for you to make your cash flow more predictable you should have all your outgoings leaving your bank account on the same day
Remember that your mortgage company and utility supplier don’t really care on which day of the month they receive money due to them, they just care that they get it.
It also makes sense to pay as many as your outgoings as possible by monthly direct debit and not quarterly or annually. This helps to ensure that you know how much is leaving your bank account on a monthly basis and puts you in control of your finances.
So, if all your outgoings go out on, say, the 10th of the month (give or take a day or two for weekends and bank holidays etc) and IF your tenants all pay on the 1st of the month (again take into account weekends etc) then by the 14th ALL of your incomings and outgoings are complete and you have a far better financial picture of how your cash flow is looking.
If you have any questions regarding your property finances or business finances in general we offer a free 30 minute Skype or telephone call. Contact us at the website below or call 0121 740 0132
Positive Bookkeeping Ltd – Looking after the business owner