Maintain a good credit score - Deepstash

Maintain a good credit score

Financial institutions, partners, suppliers and prospective customers may use your credit score to determine the worthiness of the business and if you are likely to default on a payment.

It is important to learn how to overcome a poor credit score. A good credit score could improve the financial success of the business.

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MORE IDEAS FROM How To Improve Your Business Financial Management

Debt management: It's not ideal for debt to carry over to the next financial year. It's advisable to develop a strategy to repay your debts before taking out loans.

Increase your savings: Savings can help to keep the business afloat in difficult times. Consider if your savings are enough to cover potential business losses in the next financial year.

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  • Digital platforms allow you to organise your business data and documents and have a backup.
  • Online invoicing and accounting tools can help to keep efficient and accurate records.
  • Automate your bill payments, such as utility bills or credit card payments and ensure you have sufficient funds available for paying the bills.
  • Be extra vigilant about cyber security when making electronic payments, using e-commerce platforms and technology.

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Consider the budget

Creating a yearly budget for your business allows for effective management. A budget guides your intended business decisions and helps you lay out expansion plans.

Make your money work smarter and harder by re-evaluating your income and your spending habits.

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Partnering with the right investors is critical to the success of the business. Investors can be key assets as they can gather more funds than you could through loans.

Research the most recent ventures of your potential investors, and understand how involved they would like to be.

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Automate Your Savings

The best way to attain financial success is not about having a budget or avoiding debt, or even choosing the right investments, but about having a system that makes automatic wealth creation possible for you while you sleep.
Investors make a lot of stupid financial decisions based on emotions and sentiments and putting money on ‘autopilot’ saves us from giving to temptation and laziness.

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Definition of a budget

A budget is an estimation of income and expenses over a set time. It is usually drawn up and re-evaluated periodically.

Budgets can be made for a person, a group, a business, a government, or anything else that makes and spends money.

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  1. Create a Financial Calendar: prevent yourself from forgetting quarterly tax payments and to get credit reports.
  2. Check Your Interest Rate: Pay off loans, open saving accounts and negotiate credit debts based on interest rates.
  3. Track Your Net Worth: The difference between your assets and debt — it tells you your financial standing. 

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