The Importance of Accuracy when it comes to your Money

When was the last time you calculated all of the incoming and outgoing payments from your personal bank account? It’s highly likely that it was a long time ago, if ever, as we feel we can rely on the banking systems to correctly calculate our balance. There are still a lot of places in life where mistakes can mean you lose money. Here’s why accuracy is important when it comes to making money. 

finance

Know the real worth of your investment portfolio

The secret to a successful pooled investment portfolio isn’t taking big risks or relying on luck. The real secret is that the devil is always in the detail. The only way you’ll know how well your fund is performing is to accurately calculate the values of your net assets and make sure you keep constantly updating them. A lot can change from one day’s market closing to another, so it’s important you always have access to the latest and most accurate data possible.

If you try and calculate this information yourself, you could find it takes up a lot of your time that could be used earning more money to invest. Unless you’re an accounting expert, you could also find yourself making a mistake that could cost you dearly, especially if you’re trying to rush the process. To make sure you have the most accurate overview, entrust the help of an experienced fund accounting team to do the work for you. For example, the Nottingham fund accounting team recognizes the fundamental need for precision in calculating, recording, and reporting fund performance and pricing data. Employing a team like this will give you the confidence in your data to make the big decisions needed. 

Avoid penalties

Another instance where inaccurate sums could quite literally end up costing you money is when it comes to the Inland Revenue Service. We all know we can be liable for penalty payments if we don’t file and pay our tax returns by that all-important date in mid-April. If they find some of the data you have reported is incorrect, you could see those fines increase massively. The IRS takes the number of days late the correct payment is and then literally multiplies it by the effective interest rate for the period. They calculate penalties separately for each required installment, so even the smallest of mistakes could soon add up into a big fine. 

Don’t pay more than you need to

Accuracy can also just be a simple of getting even the smallest numbers right in your day to day payments. For example, if you receive a quote from a tradesperson to carry out some work, make sure you get it written down clearly in writing. If you accidentally end up overpaying them because you’ve mistakenly written down the wrong number, it’s unlikely they’ll mention it and you’ll be throwing that money away for nothing. The same comes when you’re running a business and need to make big orders. If you need to buy new licenses for your software, make sure the number of devices you use it on is correct before you send off the order, as it’s unlikely that you’ll get a refund if you make a mistake.

About Mohit Tater

Mohit is the co-founder and editor of Entrepreneurship Life, a place where entrepreneurs, start-ups, and business owners can find wide ranging information, advice, resources, and tools for starting, running, and growing their businesses.

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