At this time, you cannot track the balance of your loan account through this feature, it is only to help produce your balance sheet. If you would like to track the balance, please check out our help article and video.
Tracking liabilities is an essential part of managing your farm's finances. Liabilities represent the debts and obligations that your business owes, such as loans, mortgages, and accounts payable. Keeping an accurate record of these liabilities helps you understand your financial position, plan for repayments, and manage cash flow effectively. FarmRaise provides tools to help you track and manage these liabilities efficiently. Here's a step-by-step guide to tracking liabilities on FarmRaise.
Step 1: Log in to Your FarmRaise Account
Access Your Account: Start by logging in to your FarmRaise account using your username and password. If you don’t have an account, you’ll need to sign up and set up your profile.
Step 2: Navigate to the Financial Tracker
Find the Financial Tracker: Once logged in, navigate to Tracks. This is where you can manage all your financial records, including income, expenses, and liabilities.
Step 3: Enter Your Liabilities
Add Liability Entries: For each liability, you need to enter specific details. To do this:
Head to "Liabilities" on the left-hand side of the screen or under "Menu" on the mobile app
Click on "Short-Term, Intermediate, or Long-Term Liabilities" to begin adding them in
Fill in the required details such as the name of the creditor, the total amount owed, the interest rate (if applicable), the payment schedule, and the due dates.
Step 4: Update Regularly
Regular Updates: Keeping your liability records up-to-date is crucial for accurate tracking. Whenever you make a payment or incur a new liability, update the corresponding entry in FarmRaise.
Before you download your balance sheet, make sure these are all up to date as it does not yet update automatically with the payments you have made to the liability.
Scheduled Payments: Set reminders for upcoming payments to ensure you don’t miss any due dates. Some financial trackers offer automated reminders.
New Liabilities: Whenever you take on new debt or obligations, immediately add them to your tracker to maintain an accurate financial picture.
Step 5: Monitor and Review
Regular Monitoring: Regularly review your liability entries to monitor your debt levels and repayment progress. This helps in identifying trends and planning for future financial needs.
Monthly Reviews: Conduct monthly reviews of your liabilities to ensure all entries are accurate and up-to-date.
Year-End Review: At the end of the financial year, review your liabilities comprehensively to prepare for tax filing and financial reporting.
Step 6: Generate a Balance Sheet
Use FarmRaise’s reporting features such as balance sheets to provide a detailed overview of your liabilities. These reports can help you:
Analyze debt levels and repayment progress.
Plan for future financial needs.
Prepare for discussions with financial advisors or lenders.
Meet reporting requirements for tax purposes.
Tips for Effective Liability Management
Prioritize High-Interest Debt: Focus on paying off liabilities with the highest interest rates first to reduce overall interest expenses.
Consolidate Debt: If possible, consider consolidating high-interest debts into a lower-interest loan to save on interest payments.
Maintain a Payment Schedule: Adhere to a strict payment schedule to avoid late fees and penalties.
Seek Professional Advice: Consult with financial advisors to develop strategies for effective liability management and debt reduction.