The Power of a Quarterly Finance Check: How Regular Reviews Can Save Your Business Money and Stress
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As business owners, we're often so focused on growth and day-to-day operations that we overlook one of the most important aspects of running a successful enterprise: financial management. It's easy to get caught up in the hustle, the day-to-day tasks that are piling up, and forget to take a step back to take a good long look at your finances. Neglecting to review your financials can lead to a whole slew of problems that will become costly over time. In this week’s blog you’ll discover why a quarterly financial review is one of the best things you could implement for your business.
We Cover:
What’s involved in a Quarterly Financial Review
Why it’s so important to regularly review your financials
How you can start your own quarterly financial review
Setting the Stage: The Annual Financial Reset
Every year, at the beginning of January, most of us take a decent amount of time and energy to prepare our businesses for the year ahead. This isn't just about setting goals or creating new products; it's about laying the groundwork for a financially sound year. You set your revenue marks, review last year’s numbers, and anticipate what numbers lie ahead. Each year, I start by creating a brand new spreadsheet for my cash flow and budget. This allows me to plan out anticipated expenses, ensuring that I have a clear picture of my financial landscape.
One of the most significant changes I made that saved me a TON of money, was transitioning many of my software subscriptions from monthly to annual payments. Initially, this might seem daunting—after all, paying for a year upfront can be stressful. However, if your business is in a healthy financial position, making this switch can save you a considerable amount of money after the course of a year. It’s like buying in bulk; it’s cheaper per unit, and in this case, per month! If you’re not already on annual subscriptions for your tools and softwares, see what it would take to get on them and if you have the funds available to cover that cost so you can save in the end.
The Birth of the Quarterly Finance Check
While my annual financial reset helped me start the year strong, I realized that once a year wasn’t enough. That’s when I introduced the quarterly finance check—a systematic review of my business expenses, particularly my tech stack and recurring monthly fees.
Why quarterly instead of bi-annually? As you probably know all too well, things change quickly in the business world. New tools and technologies emerge, teams grow, and sometimes, what once was an essential tool becomes redundant. There can be massive changes and shifts within your business from your team, operations, marketing, and all of the other moving parts of the puzzle from one month to the next. By reviewing my expenses every three months, I’m able to catch these changes early, see the impact that the pivots have on my financials, and make the necessary adjustments to ensure the business has the right resources.
What the Quarterly Finance Check Involves
The process is straightforward but powerful:
Reviewing the Tech Stack: This involves going through all the technology and software subscriptions your business is paying for. The goal is to assess whether each tool is still necessary. Are you using that project management tool as often as you thought? Do you need multiple subscriptions for similar services? If not, it might be time to cancel
Evaluating Contractor Fees: Review the ongoing contracts with freelancers and agencies. Is the value they provide still aligned with your business needs? This doesn’t necessarily mean cutting costs, but rather ensuring that every dollar spent is contributing to your business’s growth.
Assessing Payroll and Benefits: Beyond the basic salaries, look into the additional benefits like 401(k) contributions and health insurance. Are these being managed efficiently? Sometimes, a more competitive plan could save you money without sacrificing employee satisfaction and it never hurts to check up on these things!
Switching from Monthly to Annual Payments: As mentioned earlier, switching your recurring payments from monthly to annual can save you money. This step involves identifying which services offer annual billing and evaluating whether your business is in a position to make this change.
Customized Financial Reports: For clients, or even for my own business, I create a customized spreadsheet that lays out the current tech stack, associated costs, and whether each item is still needed. This report becomes a living document that is updated quarterly, making it easier to track expenses and make informed financial decisions.
The Impact: Why This Matters
Implementing a quarterly finance check has saved me—and my clients—thousands of dollars over the years. By staying on top of these expenses and being proactive about cutting unnecessary costs, you can significantly improve your business’s financial health not just right now but also for the future.
Additionally, this process brings a sense of control and clarity. There’s something incredibly empowering about knowing exactly where your money is going and ensuring that every dollar is being used efficiently. It also alleviates the stress that comes with financial uncertainty. There’s no feeling like the peace of mind and confidence that comes with knowing that you have a solid grip on your finances. Imagine how much easier it would be to focus on growing your business if you felt that level of financial empowerment.
A Personal Journey: Learning the Hard Way
Talking about expenses can stir up different emotions depending on your relationship with money. Whether you're a saver who scrutinizes every penny or a spender who views money as a means to an end, the importance of regularly reviewing expenses cannot be overstated. I had to learn this lesson the hard way, and im sure of you probably have too!
A while back, during one of my annual resets, I realized I was wasting money in places I hadn’t even noticed. I was paying for unused apps, services that didn’t add value, and incurring fees that could have been reduced. The moment I started cutting out these unnecessary expenses and optimizing my spending, my profit margins improved, and I felt a newfound sense of empowerment.
Now, I not only apply these principles to my own business but also offer this service to my clients. By helping them understand where their money goes, we can identify what truly impacts their business and what doesn’t. This might mean switching tech subscriptions to annual payments for cost savings, eliminating unnecessary contractors, or creating a budget that allocates funds effectively.
Why Quarterly Finance Checks are Essential in a Virtual World
With so many businesses operating virtually, it’s easy to sign up for new tools and services without a second thought. These small monthly fees add up quickly and can become a significant drain on your resources if not managed properly. By implementing a quarterly finance check, you can ensure that your tech stack remains lean and efficient, ready to adapt to whatever challenges or opportunities come your way.
The DIY Approach: Start Your Own Quarterly Finance Check
If you’re not ready to outsource this process, you can start doing it yourself. Here’s a simple way to begin:
Create a Spreadsheet: List out all your current tech subscriptions, contractors, payroll obligations, and any other recurring expenses.
Review Your Books: Go through your financial statements or, better yet, have your bookkeeper pull reports for you. This will help you identify any expenses you might have missed.
Assess and Adjust: Ask yourself if each expense is still serving your business effectively. If not, it’s time to cancel or renegotiate.
Take Control of Your Finances Today
It’s totally normal if you’ve never calculated your expenses before or thought about creating a budget. But if you want to feel like you’re finally in control of your money, instead of feeling like it’s controlling you, now is the time to start.
Adopting this proactive approach will not only improves your bottom line but also brings peace of mind. Knowing exactly where your money is going each month allows you to focus on what truly matters—growing your business and chasing after your goals. Taking the time to regularly review your business expenses is not just a good practice—it’s essential for maintaining a healthy, thriving business and one that is set up to scale beyond your wildest dreams. Whether you choose to handle this in-house or work with a financial consultant, the key is to make it a priority. Your business deserves the attention, and your bottom line will thank you for it. If you’re ready to take the next steps toward financial freedom and empwoerment, you can book a consultation with our team here.
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