Boy has my financial juggling gone astray today! We live on limited income from a variety of sources and sometimes we have a timing problem (bills due out this week, money coming coming in next week type of thing). As an accountant I am pretty good at this juggling.
I had it all planned out. We have dividends coming in on Monday which would cover almost all of our bills due out in the next week – except our RV payment and that is due out this week. I knew that later in February we would need to take money out of husband's IRA to cover our car insurance, but had time until same.
Well, the money to cover the RV payment was to come from the monthly client I have and she pays me quarterly when I go and do her books, etc. and I was due for a check in January. I tried to go to her last week, but when I called on Monday she was going to the doctor on Tuesday and did not expect to come into her place of business on Wednesday or Thursday either – maybe Friday she suggested? Friday it actually was suppose to be nice weather here and in Pennsylvania and husband was ready to go to Pennsylvania for the day and I could not disappoint him – who knows when the weather would be right in both places again as it has been so long since they were.
So I said that I would be in this week. I telephoned her on Monday to go yesterday, Tuesday, but she still was not feeling well so today, Wednesday it had to be. In addition to needing to do her bank rec, payroll taxes have to be filed by the end of January so I had to go there now! I was glad that weather stayed nice and no snow or rain.
I planned last night to deal with my problem – I wrote out a deposit slip for her check. I checked where branches of our bank are near her. I checked where a post office was near her. My plan was that when I finished doing her books I would take the check from her, deposit and mail out the RV payment.
When I got there she had a bad month and not only could not pay me, she could not pay her rent either. I did her books. I had her sign her payroll tax forms. I dealt with a couple of problems she had which are not related to what I am suppose to do, but I do things for her – she is in her 80s.
Well, I have my check – but cannot deposit it until she calls and says okay. I need to get that RV check out tomorrow, so we will have to go and take the money out of husband's IRA now and hope that she says I can cash check when the bills that were to be paid later in February with the IRA money come due. Just when I think I have it all taken care of….
I am sure that all of you have had similar problems. The important thing to do is keep track of it all – accurately so that nothing bounces – and if there is that rare occasion that something goes wrong and it does bounce – both the bank and who you paid will look at your records and say “hey, this never happens with you – of course we understand and will waive the fees for the bounced check/late payment”. (Yes, I did mess up badly once a few years ago and the fees were waived by both by the bank for the bounced check and by the company I had paid with the check as our record was so good that they could excuse the one error.)
To help keep my records accurate I use a software program to help me – Quickbooks (Quicken it's non- business alternative is good also). I keep my checkbook by hand and also in the program – and the two of them better agree or I have a problem to look for. The software lets me memorize the payments and when they are do and will remind me when I open it what bills need to be paid and what money should be coming in. It also lets me keep my personal expenses separate from our various businesses and each of them separate from the others. Lets me set up accounts for our tax related expenses and income to keep track of them for the taxes when they filed the following year.
THOUGHT OF THE WEEK – Now is the time to get started so that next tax season will easier for you to deal with your income taxes (presuming that you are in the US and need to do so). It is also a good time to start keeping better financial records in general as we all need to do same and it is easier to start with the start of a year than in the middle of it.
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