03/ 24/ 2005
by Tamara E. Holmes
If you don't have the time to devote to the daily financial duties that your small business requires, you might want to consider the services of a daily money manager.
A relatively young spectrum of the financial services industry, daily money management encompasses day-to-day financial duties such as managing payables and payroll, depositing checks and ensuring that your ledger is balanced.
Unlike accountants, who tend to serve as financial planners and guides, daily money managers do the day-to-day financial legwork that keeps your business running. Meanwhile, your accountant or financial planner will still help you plan your long-term finances.
Financial organization is another task you can charge your daily money manager with. A money manager can keep track of all of your financial documents and help you gather them for tax time or just for your own business knowledge.
If you need to negotiate with creditors or make calls to handle billing disputes, your daily money manager can help out here as well.
Daily money managers work with clients to set up a separate checking account that will be used for paying bills, making payroll and taking care of other regular financial obligations. Once this account is set up and the money manager reviews your monthly obligations, you can have vendors send their bills directly to your money manager. You won't have to get involved with that paperwork. Your money manager will also take care of payroll duties, making sure checks are cut at the appropriate times. If you work with independent contractors, the system can be set up so that the contractors bill the money manager and once again, you won't have to spend your time tackling that paperwork.
You'll also determine with your money manager where funds for running the account are going to come from. Whether you'll deposit a set amount per month electronically or whether you'll send the money manager a check to cover expenses, the point is that once you give the money manager the direction, you don't have to worry about the actual financial chores.
"We figure how it's going to be done, when it's going to be done and then clients don't have to do anything else," says Carla Morelli, president of Freyer Money Management in Gaithersburg, Md.
The money manager will submit to you a monthly report that explains what was paid to whom. Reports can also categorize expenses so you're constantly kept abreast of your business's financial health.
Small businesses that don't have the money to pay for a full-time financial staffer can still benefit from this service. Most daily money managers charge between $35 and $100 per hour, depending on the geographic region you're in. Daily money managers also charge for out-of-pocket expenses for items such as postage stamps for mailing your bills or long-distance phone calls made on the client's behalf.
A sole proprietor that travels a lot can also benefit from the services of a daily money manager because he or she doesn't have to worry about paying bills late as a result of extended absences from the office.
Most business owners want to maintain control of their business's finances. With a daily money manager, you can hold onto the control, but hand off the execution, freeing yourself to focus on other aspects of growing your business.
