It’s almost 2020 and that means it’s crunch time to get all of those year-end numbers finalized. In real estate, accounting should be at the top of your priority list. As a salesperson, profits aren’t always what you expect. The market fluctuates, and that means one month could bring more profits than others—this is especially true when you’re new to real estate.
That’s why it’s important to keep a good record of where the money is coming from, when it came in and how it’s going to be utilized in all of your business efforts. The most essential thing to track, however, is how much is going into your bank account each year.
Here are some tips for keeping your accounting organized.
Hire someone. This is the simplest way to get peace of mind when it comes to your money. As an agent, you’re constantly busy. Don’t let your numbers fall through the cracks because you don’t have the time to keep everything organized—that’s how you lose money. If you know it’s going to be a busy year, be proactive and hire an accounting professional.
Learn to love spreadsheets. Keep everything digital. Forget those paper books—they can easily be misplaced, and you may have trouble reading through your scribbled notes at year-end. Keep several spreadsheets that track your profits, your spending, your gas mileage, etc. These are handy when it comes to calculations because you can simply input some data and have them crunch the numbers for you.
Keep all of your receipts. These will be essential to claiming tax deductions. Any time you pay for client meals or buy equipment that’s necessary to helping you run your business—save those receipts! Have a dedicated space in your office where you keep these. And, as a safe measure, scan them and upload them into a folder on your computer.
The most important thing is to stay organized. Keeping a good record of the funds going in and out of your business will ensure you don’t lose any money. It’s also good practice for determining which of your marketing initiatives are working, and which are costing you more in the long run. Keep an eye on your accounting so that you help your business grow each year.
Liz Dominguez is RISMedia’s associate content editor. RISMedia is the residential real estate industry’s definitive source for news and information. Email Liz your real estate news ideas at email@example.com.