15 Essential Financial Planning Tips for EntrepreneursWhether you’re a new entrepreneur or an old hand, money occupies a prominent role in your business. Failing to get – and keep – your finances in order can doom your company or consulting practice in the long run. While each entrepreneur has their own set of unique financial challenges, there are several areas where nearly all entrepreneurs can draw from a general well of wisdom.

1. Pay yourself first, Uncle Sam second.

No doubt, you’ve heard the expression “pay yourself first.” That’s good advice for everyone. However, entrepreneurs must remember that with no employer-initiated tax deductions to count on, they must also make provisions to cover self-employment taxes.

2. Hire pros, but know what they’re doing.

You didn’t go into business to spend hours working on spreadsheets. That’s why you hired a Certified Public Accountant. However, you should still understand the basics of keeping the books, if for no other reason than to be able to answer your accountant’s questions at tax time.

3. Invest in your skill set. 

As an entrepreneur, much of what you have to offer is your expertise. Therefore, money spent to enhance and maintain your skill set – within reason – represents a worthwhile investment. You may even be able to deduct the cost of those seminars and classes.

4. Have a plan B (and a plan C if possible) in place just in case.

If you became an entrepreneur because you were pink-slipped, your Plan B may extend no further than sending out résumés. However, if you are not operating under the gun, a contingency plan is not a sign that you lack self confidence. It’s just common sense.

5. Prioritize your spending.

You want to send your kids to college and pay off your mortgage and save for retirement and launch your business. The hard truth? You likely cannot do it all – at least not at first. Set one or two absolute priorities and delay the others until your finances are more stable.

6. Consider service exchanges with vendors.

Unless you have millions flowing in from a venture capitalist or an angel investor, you may lack the funds for many business essentials. Why not consider bartering? For instance, you could write web copy for a local printer in exchange for stationery.

7. Startup expenses can be steep; Uncle Sam can help.

Even with a bare bones launch, you could conceivably spend major coin on essentials: business cards, domain registration, website hosting, a new computer… it adds up. However, you can claim deductions or credits for most, if not all, of your expenditures.

8. Consider alternate giving strategies.

In choosing between charitable giving and ensuring the financial health of your business, there isn’t even a contest. Your business comes first. However, pooling your small donation into a giving circle allows you to participate in making a sizeable donation.

9. Get payback from bad debts.

You should be proactive in collecting money that is owed to you. But for those (hopefully rare) instances when you get the shaft, the Internal Revenue Service has your back. If you can prove that the debt is legit, non-collectable and has caused you harm, you’re covered.

10. Don’t let “audit fear” scare you away from legitimate tax breaks.

You may have heard or read that claiming tax breaks like the home office deduction flags your return for a possible audit. While this may be true, that’s no reason to leave money on the table. If you can document your credits and deductions then you should be fine.

11. Know the difference between “spending” and “investment.”

Spending $200 to upgrade from a flip phone that can’t retrieve critical emails to a smartphone that can is a worthwhile investment. Spending $500 on a pair of Jimmy Choos for a meeting is straight up spending. Just because you can afford it, doesn’t make it an investment or business expense.

12. Separate your business and personal finances.

It may be easier at first to comingle personal and business spending, but doing so can eventually create major financial headaches when you start making regular income. Establish a separate bank account for your business with separate debit or credit cards ASAP. You’ll thank yourself at tax time.

13. Make your working vacations pay off.

Yes, you probably can deduct the costs of attending your industry’s annual meeting, even if it’s being held in Hawaii. This is true even if you extend your stay to make it a real vacation. Just keep records of business versus personal expenses to stay on the right side of the IRS.

14. Leverage business use of personal property.

The IRS allows partial tax breaks for property used for both business and personal purposes. For instance, if you use your laptop 80 percent for business and 20 percent on playing the newest Sims game, you can deduct 80 percent of the cost of operating the computer.

15. Keep. Your. Receipts.

Hang onto receipts and records for business-related spending. If you do nothing else, maintaining documentation of business expenses will provide a major foundation to your financial well being. Your CPA will also appreciate the gesture.

Written by Audrey Henderson at SuperMoney.com – A comprehensive personal finance information guide offering powerful money management tools, reviews & money management tips to help consumers win their fight for financial freedom.