It is not uncommon for businesses, new and old, to be in what is known as "bill denial." Bill denial is simply when you do not know-or, more specifically, do not want to know-how much money you owe.
Being in bill denial can have very serious consequences for both the health of a business and the health of a business owner.
"Financial denial depletes a person's psychological resources and makes it harder to function at a higher level," says psychologist Dr. Maggie Baker, author of the book, "Crazy About Money."
Cleaning equipment manufacturer, Tornado, offers the following steps to help jansan businesses and business owners succeed:
Open all bills as soon as they arrive. If you have a hard time doing this, have a trusted friend or family member help. The first step in overcoming bill denial is to know what you owe and to whom.
Track your money. As a child, John D. Rockefeller maintained a book in which he wrote down every dime he received and every dime he spent. "Tracking your finances can be a real eye opener," says Sean Martschinke, product manager and marketing specialist for Tornado. "Many people in 'bill denial' are often surprised to find out how much money they are spending and don't always know how much is coming in."
Prioritize your bills. Some people find it best to pay off the small bills first so they can tackle the larger ones later; others pay off high-interest credit cards first. What's important is to develop a bill-paying strategy.
Keep in touch. If you cannot pay a business obligation when due, contact the creditor and work out a payment plan. If they call you, return the call. Keeping in touch keeps you and your business credit worthy.
Seek help. Bill denial can be an occasional problem or a chronic problem. If you find yourself in bill denial frequently-or continually-get help from a professional.