5 Ways To Separate Personal Money And Business Money, Let's Note!

Illustration of separating personal money and business money (Photo: Pixabay/Katya_Ershova)

YOGYAKARTA Someone who is starting a business needs to separate personal money and business money in order to find out the amount of profit generated from business activities. However, applying how to separate personal money and business money is not an easy matter. A strong commitment is needed, including discipline in managing financial reports in order to separate money for personal and business importance.

So, how do you separate personal money and business money? Let's see the following explanation.

Summarized from various sources, Wednesday, January 24, 2024, here are how to separate personal money and business money that business activists need to know:

1. Create two different accounts

The first way to separate personal money and business money is to create two different accounts. One account is used for personal gain and the other is for business transaction purposes.

By separating personal accounts and business accounts, you can manage your finances more easily.

In addition, this method also makes it easier for you when you want to reflect the cash flow of business money or personal financial conditions. Through account separation, you can know for sure whether the business that is being started has already made a profit or vice versa.

2. Manage the business well

If you have separated your personal money and business money in a different account, then the next step is to manage your business well.

Separation of personal accounts and business accounts allows you to develop your business optimally. The trick is to calculate the budget for routine expenses for business purposes. Estimates that income is routinely obtained, after which you also need discipline in doing so, such as filing bills and spending notes.

3. Pay yourself

The third tip is to set aside some of the benefits that are obtained from business activities to pay yourself. This is very important because it can minimize the possibility of using all profits for personal gain.

Apply these tips with the discipline of paying a small salary for yourself. If finance in business has started to increase, increase the amount of salary until in the end you can hire and pay employees a decent wage.

4. Evaluation and analysis of financial conditions

Every week, business owners need to conduct a financial evaluation in order to find out the movement of business capital and the benefits they get. Take note well and neatly all things related to your business.

In addition to evaluating, you also need to analyze your financial condition regularly. This can be done every 3 months. Don't forget to pay attention to your financial condition and debt if there is one.

5. Allocate the profits appropriately

The last tip, allocate the benefits obtained from business activities appropriately. Related to this, you can use formula 2.5 : 15: 20 : 30: 32.5. The purpose of the formula is:

That's information about how to separate personal money and business money. Hopefully this article can add insight to the loyal readers of VOI.ID.