Whether you’re a small business or a large business, an individual who’s lent money to loved ones or a professional creditor, keeping detailed records of debts owed is key. In fact, it’s a vital part of financial management. Not only does keeping detailed records of debts help you to stay organised and on top of what’s owed, it also helps to protect you if a debtor tries to dispute your claim. With detailed records of debts owed, debt collection is a lot less stressful and a lot more straightforward. But, what are the best practices for keeping track of your debts?
How Best to Approach Keeping Records of Debts Owed
- Have One System for Records – If you have multiple ways of keeping track of debts, there’s a high chance that information will go missing or debts will be logged incorrectly. By having one central system, you can track everything in one place. This will save you a lot of time, regardless of whether you choose a cloud based platform, software or handwritten notes as your approach.
- Include All Important Information – You might be tempted to keep things simple by only logging key information, assuming that this will stop things becoming overcomplicated. But, it’s actually a lot more beneficial to include as much information as possible. You should keep records about debtor information – such as their name, contact details and account information – as well as information about the amount owed, when the debt occurred and how much they have already paid back.
- Set Up Reminders – There’s a lot that goes into the debt recovery process, and it can be hard to keep track of everything, especially if you have multiple people and businesses that owe you money. By setting up reminders, you can keep on top of when payments should be made, enabling you to chase debtors if any are missed. It’s a good idea to send debtors a reminder a few days before a payment is due, to give them time to get their finances in order.
- Log All Correspondence with Debtors – Keep a detailed record of every correspondence you have with a debtor, whether that’s in person, over the phone or in writing. These records can act as evidence if a debtor claims that they didn’t know about the debt, and they can clear up any misunderstandings about how much is owed and when it needs to be paid by.
At Cobra Financial, we understand that keeping detailed records of debts owed can be time consuming and complex, which is why we’re here to manage everything for you. Whether it’s tracing a debtor or face-to-face debt recovery that you need, our debt collection agency is on hand to help. We handle the ins and outs of debt recovery, whilst you focus on other things. Get in touch to find out more.
