What is Financial Health?

Posted on December 8th, 2020

Financial health refers to the overall state of your monetary affairs. It’s your ability to manage earnings, expenses, debts, wealth, and fiscal shocks. There are various ways to create financial health, including savings, retirement plans, and planning how you spend your income. If you can comfortably handle unexpected financial emergencies as well as short- and long-term needs, then your financial health is positive.

Good financial health has several benefits. According to the APA, a majority of stressed individuals mention money as the cause of their discomfort. Financial wellness reduces or eliminates stress and associated problems such as depression, weight gain, erratic sleep patterns, and heart disease. It significantly improves your personal and professional relationships. Other benefits include providing you with more lifestyle options, creating financial stability for your children, and allowing you to give back to your community.

Signs of Financial Health

The most trustworthy way to gauge financial health is to measure savings, debt, and net worth. Since they’re not constant, it’s advisable to do so regularly. A steady source of income increases the likelihood of financial wellness. Having multiple revenue streams reduces the impact of financial surprises and gives you room to create a comfortable budget.

Another sign of financial health is the ability to reduce or maintain the same level of expenses while increasing your income. More money means you can save more, as well as enjoy a higher quality of life in the future. One way of doing so is to focus on building your career, which results in better-paying positions and overall financial security.

Besides increasing contributions to your 401(k) and other retirement plans, you can also diversify your income. High return ideas include part-time freelancing or consulting, investing in real estate, re-selling, and affiliate marketing.

How to Improve

The first step to improving your financial health is to evaluate your current status. You should have a realistic view of your income, expenses, and debts. Follow these tips:

  1. Create a budget

A budget is the most basic and valuable tool for financial discipline. Individuals, companies, and even countries use it to guide their spending. For it to be effective, you must consider your current financial habits before planning for the future. It gives you a clear picture of items you must spend on, including rent, taxes, groceries, and household maintenance. You can also do away with discretionary expenses such as vacations, fine dining, electronics, and subscriptions that you no longer need.

  1. Have an Emergency Fund

Financial emergencies include job loss, illness, car trouble, natural calamities, and the death of a loved one. Although no one wishes for them, you must prepare for their eventuality. Your emergency fund should have enough money to cover living expenses for three to six months.

  1. Reduce or Clear Your Debt

There are two effective debt reduction methods you can use. The first is the avalanche method, which gives priority to the debt with the highest interest rate. Once complete, pay off the next highest one until you clear it all. The second method is known as the snowball method, in which you pay off the smallest debt as fast as you can. Once done, move these payments to the next smallest debt until you are debt-free.

  1. Automate Your Savings

Arrange for your bank to automatically split your paycheck every month, then move a fixed amount from your checking to a savings account. Utilize whatever remains to cover your monthly needs.
Tracking Your Progress

You can use spreadsheets to evaluate whether you’re meeting your financial goals. Create a category for each fund and ensure each entry is within your budget. If you find spreadsheets too time-consuming, there are several apps you can download on your mobile devices.

These apps can also track your FICO score through TransUnion, Experian, or Equifax. Other financial benchmarks to analyze are your net worth and savings rate. At the end of each month, quarter, or year, you’ll accurately see whether you’re on track to achieve your financial goals.
Learning to Maintain a Positive Financial Attitude

The tips outlined in this article don’t come naturally to most people. You have to dedicate a significant amount of time and effort before seeing positive results. Study the most effective money-saving strategies and implement the ones you find most suitable. Fine-tune them until you find a winning formula.

Find a mentor who’s enjoying success and let them guide you on improving your financial health. You’ll need the support of your family, friends, and the broader community to achieve your long-term objectives. It won’t be easy to enforce financial discipline without their encouragement. Over time, these collective actions will form a culture that future generations will find easier to maintain.

Do you have additional tips on improving financial health? Please share them in the comments section below.

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Why You Could Use a Fraud Examination

Posted on August 9th, 2018

WDR partner Colin Combs is a certified fraud examiner (CFE™), a specialist who looks for signs of embezzlement and other forms of misuse of company assets. While this process’ purpose is self-explanatory, the benefits you gain from this process are not always apparent. What exactly is it that fraud examinations do for you?

Discover Actual Instances of Fraud

People interested in these examinations suspect that fraud is occurring at their own company. Unfortunately, that suspicion is not always acted on when first noticed. By the time they believe their suspicions are justified enough to act upon, the misuse of business assets could have grown out of control.

Undergoing a fraud examination the moment you notice any strange imbalances lets you most effectively protect your business. Colin can determine if a simple anomaly is evidence of a much more harmful situation and how to make sure these problems do not become a more significant concern.

Identify and Reduce Fraud Opportunities

Fraud examinations are useful even if no misuse of company assets is detected. The investigation will outline the areas of operation where fraud is more likely to occur. Then, Colin and your business collaborate to reduce these opportunities through the implementation of new controls.

Often, these updates include the improvement of existing anti-fraud measures. As new risks and technologies come into existence, new approaches must be taken to make sure your assets stay secure. Whittemore, Dowen & Ricciardelli, LLP, stays current with any trends in financial security to guarantee the most effective solutions are always available to your business.

Employee Education

Embezzlement prevention is not just a matter between Colin and you. Every person who works for your business plays their own part in stopping these concerns. Therefore, you can bolster new and existing controls by having your employees understand the signs of fraud. Fraud examinations provide WDR and your company’s management the opportunity to educate the workforce on what activities are suspicious and how to report them.

Contact WDR for Fraud Examinations in Queensbury

Whittemore, Dowen & Ricciardelli, LLP, helps the businesses near Queensbury, Saratoga, Glens Falls, and Malta avoid fraud and embezzlement. Whether you think your company is a victim of these crimes or you want to make sure they do not happen, Colin’s expertise helps you stay safe. For more information, call WDR today.

Tax Tips for Small Business Owners

Posted on May 29th, 2018

Every year, investigative tax notices are mailed to small business owners. While these are not always official audits, they raise a red flag, and proprietors should know how to prevent and address these inquiries in turn.

This list addresses the best tax practices for small businesses to keep them abreast of tax changes and trends, and away from IRS scrutiny.

List of top 15 Best Tax Practice Tips for Entrepreneurs
1. Maintain thorough and separate records of employees and contractors.
2. If you set up any location based business, even temporarily, keep records of all expenditures and educate yourself on the local tax laws.
3. Use a tax software accounting system – this can help you develop appropriate reports at tax time and can alert you of changing tax rules.
4. If you hire a tax accountant make sure they have experience with taxes as they relate to your specific business.
5. Keep records—including serial numbers and detailed receipts—for all business equipment, office machines, and vehicles.
6. Don’t use funds that are earmarked for taxes as a means to tide your business over in hard times. This will result in a worse financial crunch come tax time and if you can’t pay, you risk the loss of your tax ID.
7. Educate yourself on the correct way to estimate your taxes – This may be overwhelming and a tax professional is highly recommended for small business owners.
8. Determine an appropriate fiscal year so that you can plan better for tax time: A fiscal year refers to an accounting year that does not end on December 31.
9. Tax records should be kept for a minimum of three years – unless related to property and depreciation. In that case, tax records should be kept for three years past the time ownership ends.
10. Keep detailed records on business vehicles’ usage – both on the job and off.
11. When operating on foreign soil and dealing with other currencies and tax laws, be sure your tax professional is vigilant in obeying the new rules on foreign bank accounts enacted in the Foreign Account Tax Compliance Act, or FATCA.
12. Work with your tax professional to determine whether you should operate as a partnership, an S corporation, an LLC, or a sole proprietorship.
13. Become familiar with your requirements in regards to the Affordable Care Act.
14. If you are not able to pay taxes owed to the IRS, or another tax agency, contact your tax professional right away. There are appropriate steps that can be taken and ignoring it only makes it worse.
15. If you are paid in cash – that payment is taxable. The IRS has sophisticated technology to track spending habits and bank accounts to build their case.

Let the experts handle your taxes for you. It is usually a mistake for a business owner to complete their own taxes, and doing so can distract you from making your company a success.

Things to Ask Your Accountant at Launch

Posted on May 3rd, 2018

Opening a brand-new business is an exciting process for first-time owners and experienced managers alike. Having an accounting firm around to answer your inquiries can help you take that excitement and turn it into long-term success. There are several questions to ask your accountant before launch:

Payroll Setup

An effective payroll system is critical to your new venture’s success. Sound payroll processes allow you to maintain an active workforce during the first few weeks of operation.

Unfortunately, many business owners aren’t familiar with the unique realities of payroll management. Different systems have different advantages, and the option that seems best now might not produce long-term results. By talking to Whittemore, Dowen & Ricciardelli, LLP, you receive the expert guidance that keeps your employees’ withholdings secure, accurate, and filed on time.

Bookkeeping Setup

Establishing good bookkeeping practices is just as important. Yet, as with payroll, the abundance of bookkeeping decisions can make it difficult to choose the right method for your company. Fortunately, our team assists you in these matters as well. Whether you need help making sure you are operating QuickBooks at maximum efficiency or maintaining accurate inventory records, you should talk to the accountants at WDR.

Sales Tax Calculation

The IRS can be ruthless when collecting unpaid taxes. However, their agents are even more exacting when investigating a company for failure to pay all sales taxes owed. Entrepreneurs who open a virtual entity after being used to brick-and-mortar operations often experience this problem, as the sales tax rates may unexpectedly change when selling products online.

To protect the business you are launching, you need to know how your entity’s sales tax obligations are calculated and how often you’re required to pay them. Our accountant’s expertise will help you with these determinations.

Contact Us for New Business Formations

Whittemore, Dowen & Ricciardelli, LLP provides business startup services to new company owners. Any brand-new venture in Queensbury, Saratoga, Glens Falls, or Malta can benefit from our comprehensive knowledge of these markets and all potential roadblocks encountered at launch. If you need expert accounting assistance before your grand opening, call WDR today and schedule a consultation.

Top Budgeting Tips for Small Business

Posted on February 24th, 2018

Small business owners tend to manage both personal and professional finances.
When starting up a small business, it is sometimes necessary to introduce new financing to your venture to enable growth while generating enough cash flow to maintain ongoing financial stability.

To keep from joining those businesses that fail in the first five years, it is necessary to hone your budgeting skills, maximize liquidity, and stay on track.

Categorize Your Expenses into Departments – Categorizing your expenses is the first step toward tracking and reporting finances so that you can get a good understanding of your business’ financial status. Some categories might be marketing, IT, labor, and overhead.

Round Up not Down – Make a practice of rounding up when budgeting for your small business. This allows you to simplify accounting with whole numbers and creates a small cushion that can be reconciled at the end of each quarter and funneled back into your business.

Scrutinize Every Business Purchase – Small business owners tend to closely watch large purchases, but fail to analyze the small purchases. Overhead costs and petty cash expenditures add up quickly, so be sure to keep an eye on them.

Update Your Budget Monthly – The customer base, expenses, and cash flow of any business is typically ever-changing. Make sure to update you’re A/R and A/P categories, and adjust your projections accordingly.

Incentivize Your Employees – Be sure to reward excellent employee performance. When someone goes above and beyond, resulting in the further success of your business, acknowledgment or celebration can go a long way in showing your appreciation. Specify a specific dollar amount for this event so you are less likely to overspend when that time comes.

Extra Fees and Late Charges – Be mindful of the costs of paying bills late. Some vendors even add additional charges for delinquent payment. If there comes a time that you have to decide which bills to pay first, this information is handy and can help you plan your accounts payable calendar.

Compare Necessary and Frivolous Expenses – Payroll, taxes, utilities, essential stock, rent, and mortgage payments are considered your necessary expenses and should be compared to additional expenditures. Be frugal when considering paying for anything that isn’t vital to your business – and compare prices make sure you’re getting the best rate.

Above all use common sense – and discipline. The future of your business depends on it.

Understanding Financing and Equity

Posted on February 7th, 2018

At Whittemore, Dowen & Ricciardelli, LLP, we have helped all manner of businesses overcome the struggle of developing their wealth. One of the most significant challenges in this regard is determining the right balance of where funds come from: financing agreements and personal equity. Owners who are running their first business may not know the crucial differences between the two options, and more experienced entrepreneurs may not appreciate their respective advantages.


Financing involves using someone else’s money. Every lending agreement you enter with a bank is another source of immediate funds your business can use to grow. However, your company must pay that money back.

Many new business owners make the mistake of not considering how borrowing money affects their long-term financial success. If you develop a money management plan that relies too heavily on financing agreements, your profits are severely undercut. In extreme cases, this can cause otherwise successful companies to go bankrupt.


Equity is using your own money. It refers to the sum of earnings and assets left over when your overhead is paid. Equity planning means finding ways to build your company up until it can afford the next major investment.

Equity allows your business to grow with minimized debt, but that wealth development is a slow process. Companies that lean too heavily on equity might have their growth severely limited or slowed.

Which Approach Is Better?

Both options resolve different concerns and help counteract each other’s drawbacks. We therefore recommend a precise balance of both approaches, so that your company can most effectively grow and maintain that progress. By working with the accountants at WDR, you can develop equity and financing plans that best serve your requirements.

Contact Us for Small Business Advisory

Whittemore, Dowen & Ricciardelli, LLP, provides small business startup and growth support, which includes developing and facilitating financing agreements and equity plans. We want to see the businesses in our local communities of Queensbury, Saratoga, Glens Falls, and Malta succeed through smart money management. For more information, call WDR today and schedule a consultation.

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