This is a super personal post but I absolutely love reading about others’ behind-the-scenes posts about where their money comes from and where they spend money, so here goes. I recently switched over to QuickBooks Online and boy oh boy do I LOVE it! But, for the past 10 years, I’d been doing it the old-fashioned way and tracking my expenses using spreadsheets and an outdated software program. Stay with me here, this is either going to make your head explode because of boredom or you’re going to feel sorry for me because it’s the most convoluted thing you’ve ever seen. Just know that I’m now in a good place. 🙂 And a special shout out to my mom, Lori, for putting up with my bookkeeping questions for the past 10 years, I SO appreciate it.
Bookkeeping is something that I struggle with and it’s not natural for me. I love tracking things and I’m super organized, but I work best when I know of a good strategy and then can replicate it. The problem was, everyone did it a different way. For example, when I asked to see a Chart of Accounts, each person had it set up a little different. I would
spend waste a lot of time trying to find the “perfect setup” that didn’t exist.
First, I’d track items in email. When I would get a receipt via email, I’d move it to a folder in my Outlook to reconcile the following month. At the end of the month, I’d go through my physical receipts, emails, bank statement, credit card statement, Paypal report, and add everything to my QuickBooks Simple Start 2008 (don’t hate, it worked). And then I’d add it all to my spreadsheet and if it matched up, I was good. This took me about 2 hours per month and I sort of liked it, so it wasn’t something that I looked to outsource.
Now that everything is more automated, I don’t spend nearly this amount of time, maybe 20 minutes a week to categorize everything as it’s pulled into QuickBooks from the other sources. I have it hooked up to my business checking account, Paypal, and my business credit cards, so it’s super easy to see where things are coming in and going out PLUS it keeps me from co-mingling my money. Yes, totally guilty of doing that until my coach, Carrie Wilkerson, set me straight 🙂
Disclaimer: I am not an accountant, bookkeeper, or financial adviser, so read this as entertainment value only, not financial advice. These figures don’t include tax, estimated tax payments, or owner’s draw (money I pay myself – a term I JUST learned this last month by the way).
Below are the main expense categories. My old spreadsheet had a lot of categories that I have since consolidated this year so it’s not standard by any means, just how I liked to group things in order to make business decisions.
Bonuses & Commissions: $1,519.97
This covers affiliate commissions for product sales and training courses plus referral or finder’s fees to others who bring me clients, etc.
Mostly graphic design projects and copywriting.
Virtual Assistant: $575.00
I do much of my own work and, since it’s highly automated, I don’t need much help. But I do have someone to help with social media, research, and SEO (eg, my son goes in monthly and adds keywords to images and blog posts).
Domain Name Registrations: $293.32
I went a little crazy a couple of times this year. Have you ever had this great idea on a weekend and thought of a dozen names for a program, a product, an online course, webinar, etc., buy a bunch of domain names, and then use none of them? Me too.
Online Programs: $4,120.76
Includes costs for hosting, Dropbox, Instant Teleseminar, McAfee, Sucuri, MyFax, TimeTrade, and Infusionsoft.
Travel-associated costs such as airfare, lodging, meals, etc.
I have at least one coach per year, sometimes two or three. I joke that sometimes I have more coaches than clients.
Business Learning: $7,762.05
This includes membership programs, information products, online seminars, workshops, conference registrations, dues for trade associations, Infusionsoft certification renewal. (Probably the worst-labeled category, but whatever, it’s now parted out in the new system so that dues/subscriptions are separate.)
Business cards, promo items (USB and pens are my fave), Facebook ads, and banner placements on other websites.
Emergency Funds: $3,313.63
Usually something like replacing a printer, zip drive, etc.
Private Label Rights: $934.45
I purchase PLR as starters for content, blog posts, email sequences, information products, etc. If you want reputable PLR sites, here are my recommendations. Because this is mostly static year after year, in the new system I added it to the software category because I no longer need to track separately.
Software and Graphics: $430.00
Software upgrades, plug-ins, stock photos, themes, templates, audio bumpers, etc.
Miscellaneous items such as client gifts, postage, bank fees, office supplies, etc.
Total expenses: $37,131.29
Remember, I started out from scratch like everyone else does. I still do a lot of things myself, but as my business has grown over the years, I’m now able to invest in higher-end automation programs so that I spend less time. As you grow YOUR business, you’ll be able to invest more as well. Each year you’ll allocate funds to what’s important to you, but the first step is tracking your expenses so that you can make better business decisions.
So there you have it. That’s how much it costs to run my business. What about you? What aha’s did you get from this post? Are there things that you need to invest in for your own business? Any surprises that stand out? I’d love to hear about it, comment below!