You may be wondering why you should have separate finances when it is so convenient to do so. But there are three main reasons why you shouldn’t commingle your business and personal finances. First, it will make taxes more complicated because now you have to determine whether expenses were personal or business-related. Second, it will make the tasks at hand harder because any time you spend focus on one set of numbers, your other set of numbers will distract you from that task. And thirdly, if something happens with the company’s financials then this can affect both sets of finances which leaves them in a shaky position overall.
1. The first reason you should keep your finances separate is that it will make taxes more complicated
The first reason you should keep your finances separate is that it will make taxes more complicated. You may be wondering why you should have separate finances when it is so convenient to do so. But there are three main reasons why you shouldn’t commingle your business and personal finances. First, it will make taxes more complicated because now you have to determine whether expenses were personal or business-related. Second, it will make the tasks at hand harder because any time you spend focus on one set of numbers, your other set of numbers will distract you from that task. And thirdly, if something happens with the company’s financials then this can affect both sets of finances which leaves them in a shaky position overall.
2. The second reason is that it will make the tasks at hand harder because any time you spend focus on one set of numbers, your other set of numbers will distract you from that task
Consider how much more difficult your day-to-day work would be if you had to juggle two sets of numbers and two sets of tasks. You would have to constantly switch from one task to the next, with distracting thoughts for each for them in between. This can become very tedious and frustrating, not to mention difficult.
3. And thirdly, if something happens with the company’s financials then this can affect both sets of finances which leaves them in a shaky position overall
The third reason you should keep your finances separate is that if there are any problems with the company’s financials then this will affect both sets of finances. This will put the company in a really difficult situation because now they have to figure out how to fix both their personal and business financials.
If you’re wondering why you should have separate finances when it is so convenient to do so, think about the three main reasons listed above. The first reason is that it will make taxes more complicated because now you have to determine whether expenses were personal or business-related. Secondly, if any difficulties happen with the company’s financials then this would put them in a difficult position overall since they would be dealing with both sets of finances at once. And finally, having two different sets of numbers and tasks makes your day-to-day work tedious and frustrating which can lead to errors due to distraction from one set of numbers over another set. If all three points sound like something worth avoiding for yourself and your business, reach out today! We’ll help you refocus your finances and get you the best rates possible.
