💼 Business Owner Finance Cheat Sheet

Simple Money Basics Every Business Owner Should Know

💰 1. Revenue vs. Profit

• Revenue = total money coming in
  

• Profit = what’s left after expenses
  ✅ High sales don’t always mean a healthy business.
  
  

💸 2. Cash Flow is King

Even profitable businesses can fail if cash flow is tight.
Cash flow = timing of money in vs. money out.
📌 Always know what bills are due and when income hits.

📊 3. Know Your Numbers (Monthly Minimums)

Track these consistently:

• Income
  

• Expenses
  

• Net profit
  

• Outstanding invoices
  

• Business savings
  

• Debt payments
  
  

🧾 4. Taxes: Don’t Get Surprised

• Set aside 25–35% of income (depending on your structure)
  

• Consider quarterly tax payments
  

• Keep business and personal spending separate
  
  

🏦 5. Pay Yourself on Purpose

Avoid “whatever’s left” owner pay.

• Create a consistent owner draw or salary
  

• Budget it like any other expense
  
  

💳 6. Debt: Helpful or Harmful?

Good debt = supports growth (equipment, expansion, training)
Risky debt = keeps you afloat short-term without a plan
📌 If you can’t explain the payoff plan, rethink it.

🧰 7. Emergency Fund for Business

Aim for:

• 3–6 months of operating expenses
  

• More if your income is seasonal
  
  

📈 8. Plan for Growth (Not Just Survival)

Ask:

• What do I want my business to look like in 1 year? 5 years?
  

• What do I need to invest in now?
  

• What needs to be protected?
  
  

🛡️ 9. Protect Your Business & Income

Common protections to consider:

• Liability coverage
  

• Professional insurance
  

• Disability insurance
  

• Life insurance (especially if others depend on your income)
  

• Business continuation planning
  
  

🧠 10. Common Business Owner Mistakes

🚫 Mixing personal and business money
🚫 Not tracking cash flow
🚫 Ignoring taxes until April
🚫 No savings buffer
🚫 Growing too fast without a plan
🚫 Undercharging for services

⭐ Quick Best Practices

✅ Review your finances monthly
✅ Keep clean bookkeeping
✅ Have a tax plan
✅ Build savings
✅ Know your break-even point
✅ Ask for help early—not in crisis

📌 Key Question to Ask Yourself:

Do I have a plan… or am I just hoping it works out?