Costly Accounting Mistakes: How Hiring an Accountant Can Help You Save – Guest Post
There’s no denying that most of us are never taught how to balance a checkbook, much less manage a budget and complex finances. So when it comes to earning, spending, saving, investing, building credit, and paying taxes we often find ourselves in the dark, blindly groping for a financial plan that won’t leave us in the poorhouse. And while spending money on accounting services may sound somewhat counter intuitive to the idea of saving, the truth is that having the help of a professional will lead you to save a lot more than you could on your own. So here are just a few costly mistakes that a personal accountant can help you avoid.
1. Abide by changing tax laws. The main purpose most people have in hiring an accountant is to help them save money on taxes. This is a great idea since you probably don’t have a very clear idea of which tax laws apply to your particular situation, which can be used to save you money, and which have recently changed (potentially in your favor). Your accountant will be well aware of the current laws and how they apply to you specifically, which will save you the time of doing the legwork (and possibly missing money that should be yours).
2. Missing deductibles and tax breaks. One of the biggest failures that people make when doing their taxes is missing out on deductibles and tax breaks they could be claiming in order to pay less (or even get money back). An accountant can make sure that you take advantage of every write-off available to you.
3. Independent work status. With the recession resulting in job loss and long-term unemployment, many people are changing careers and even taking on freelance work opportunities in order to make ends meet. If you’re a first-time freelancer you may not realize how many write-offs are available to you. And since you aren’t getting the same tax advantages you would have as an employee, you really need to know how to save come tax time.
4. Fixing a poor credit rating. You may not realize that you suffer from a low credit rating until you go to buy a car, a home, or some other big-ticket item that requires a loan – and find that you’ve been denied. Did you even know that it was possible (and advisable) to order a free copy of your credit report once a year? An accountant can help you find ways to improve your credit rating and ensure that it stays high.
5. Managing your personal finances. Planning a budget, saving for the future, and considering investments are all areas where your personal accountant can come in handy. If you thought that accountants were only good for sending off your taxes, it’s time to think again. They can help you with the basics as well, so that your personal finances become much more manageable.
You don’t have to spend years studying to earn a Bachelor’s of accounting or even spend a few minutes contemplating online accounting degrees in order to successfully manage your finances and get money back on your taxes. By shelling out a few ducats to hire a professional accountant you can save time and money, avoiding the costly mistakes that have plagued you in the past.
Carol Montrose is a writer for Accounting Degree where you can find the accounting program that’s right for you. She resides in Southern California and is currently writing a book in her spare time about the joys of freelancing.