The capital you have on hand is the lifeblood of your company, but balancing the delicate pattern of outgoing expenses against new investments can be difficult. If you’re new to overseeing small business finances, you need to know how to separate your working capital from your cash flow commitments and cash reserves. Here are a few tips to help with that.

1. Separate Your Funds

Keep your cash reserves in a savings account and not your business checking. That’s not all. It helps if you can find a way to separate your daily expenses from your available working capital. There are a few ways to do this. You could open a separate business checking account to receive the budget for reinvestment, keeping your cash flow finances in your main checking.

You could also use a cash flow financing option that essentially consolidates your outgoing payments into one monthly expense. This makes it easier to tell what your remaining working capital will be for the month.

2. Set Up Backup Financing

Even if your day to day cash flow doesn’t rely on financing to bridge the gaps between incoming payments and outgoing commitments, you can never tell when a cash crunch will happen. Seasonal demand falloff, business disruption due to disasters, or customers who pay late can cause it. When cash flow falls short and your working capital tightens, you’ll need something like a business credit line or asset financing option. If it’s ready to go, you get back to business as normal faster than if you’re waiting on an approval with a new financing company.

3. Keep an Eye on Your Reserves

Cash reserves exist to cover small gaps, but if you dip into them again before they are replenished, you’re using up the burn time you’ve built in to the business. It’s okay to cover a few small gaps when payment is on the horizon, but before you deplete the reserves, be sure you’ve exercised all your options for financing working capital. The longer you protect those reserves, the less you’ll need to work to repair them after your business income bounces back.

4. Use Your Business Model

Financing options for capital assume you’re working with the strengths of your business. Cash advances against assets like your merchant account or invoices are based on their value to you, so the more important that asset is to your business, the easier it is to finance your cash flow with it. Typically, that also makes it easier to pay back in a timely, cost-effective manner. If you’re not sure what would work for your business, talk to a financing professional about your options and your business model.