UnF*ck Your Money
Welcome to The Unfuck Your Money with Nadine Zumot, Certified Money Coach, Functional Somatic Practitioner, Leo Virgo Cuspie, 1/4 Mani Gen and a lot more!
The Unfuck Your Money Podcast is for coaches, practitioners, and Soul-led entreprenurs who are ready to step into their Unfuckwithable energy!
With my direct, edgy and fun approach to money, the purpose of this podcast is to help you break through your financial blocks, release unhealthy money patterns, and cultivate a sexy and secure relationship with money.
UnF*ck Your Money
Getting Intimate With Your Numbers with Misa Bacon
Picture this: you're a business owner, a whiz at your craft, but the thought of crunching numbers and reconciling bank statements and doing you books sends a shiver down your spine. That’s exactly where this week’s guest, Misa Bacon, comes in!
Join us this week on this fun episode all about harnessing the superpowers of having perfectly kept books!
Yes, I DID indeed say the words “fun” and bookkeeping in the same sentence!
Making numbers fun is a talent, and as a dedicated bookkeeper, Misa reveals her unique perspective on the why behind getting clear about our numbers as healers, coaches and service providers.
Episode highlights:
- End of year financial tasks and little tips to ensure a stress free tax season for entrepreneurs and business owners.
- Common bookkeeping mistakes she sees and how to avoid them.
- How to price our services as business owners.
- When to start working with a bookkeeping software and when to hire out certain tasks in your business.
- The importance of having a kind tax professional and how that impacts your business’ financial wellbeing on the long run.
- What are the main financial reports we must review on a monthly or quarterly basis and what to look for when viewing them.
- How to pay yourself as a single member business owner, and how to keep clean records of receipts and deductibles.
We hope you enjoy this conversation, and gather some tips to take control of your finances, and have a stress free tax season!
❤️ Nadine + Misa
_____
Connect with Misa:
www.perfectlykeptbooks.com
IG: @perfectlykeptbooks
Misa is the CEO of Perfectly Kept Books and a QuickBooks Pro. She is passionate about helping women get comfortable with their numbers so they can feel empowered to make better business decisions. She believes that finances can bring up a lot of fears and anxieties, so she focuses on creating a calming and fun experience for her clients.
Misa knows that too many accountants can be factual and to-the-point, which can make looking at your books with them an awkward experience. That's why she brings her classic southern hospitality into her services. She'll get cozy with her clients as they discuss their goals and finances so they can feel at peace looking at their numbers.
As a single mom to an amazingly creative daughter, it's important to Misa that she grows up in a world surrounded by empowered women. That's why she loves supporting women-owned businesses with their bookkeeping. She believes that all women deserve a team helping them create a strong financial foundation for their business.
Explore my 3 month Wealth Program MOMENTUM ⭐️ HERE ⭐️
Thank you for being here ❤️
✨If this podcast is a helpful resource for you, please share it with your friends, on social media, and leave a 5-star rating and review.
Connect with me on Instagram for free tips, inspo: https://www.instagram.com/nadinezumot/
~Podcast theme song by The Jilted Irony
Hello everyone, welcome back to the Money Healing podcast. So today we've got a very fun guest talking about a very boring topic. No, I'm kidding, I'm just cracking her up. So Misa Bacon is here and Misa is a bookkeeper. Hi, misa, how's it going Good? How are you Good, thank you. So we're going to be talking to you all about bookkeeping. So you've got two number nerds here, but we are both fun people and I know that you all know me, but you don't know Misa. But I brought her on because she talks about numbers in a very empowering and holistic way, just like I do. I wouldn't bring any boring bookkeeper to lecture us here on the Money Healing podcast. Out of all podcasts.
Speaker 1:I often get people messaging me saying do you want so-and-so on your podcast? They are so frugal and know how to do things on the cheap. I'm like do I sound like this is exactly what we need to heal from? No, that's not what we need. So I love the way you look at numbers. I love your perspective and tell us a little bit about yourself before we dive in.
Speaker 2:So I'm Misa, as Nadine said, and so I'm a-. I wasn't lying, she is Misa. Yes, I am actually a previous corporate ladder climber. So I came from the corporate world. I was there building up my career, working in the accounting department, and I got to a point where I kind of hit a ceiling and I was like I'm going to have to do something else. And when I was trying to think of what I could do, what type of business could I create, somehow bookkeeping came along and it made sense.
Speaker 1:It made sense, it called to you, it really did.
Speaker 2:Come and get me. It's so funny because I enjoy it. I love everything about it. People are always like you really like this, and I'm like, yes, I do, I love bookkeeping.
Speaker 1:I used to do bookkeeping. I used to do bookkeeping courses in my free time. That's how much I love bookkeeping.
Speaker 2:It's so exciting because I don't know, if people just they don't see the beauty of it and I do, I do, are you?
Speaker 1:a Virgo, because I'm a. Virgo, you're a Gemini. I don't know what it is, but I also get off on, as your business is called, perfectly kept books. Yes, I love that. So if I ask you, what turns you on in life, in addition to perfectly kept books, what else turns you on in life?
Speaker 2:Well, so you may or may not know that I am a mom of one. I have a very, very creative daughter, and being able to see her walk in her creativity and actually she's just found something she really loves and enjoys and allowing her to be able to really immerse herself in that, that has been the best thing ever, because it's not something I had as a child. We just have to do whatever we're supposed to do, but seeing that she has an interest in something and then really being able to support her around that and expose her to things that I mean, I don't know anything about the arts, so I'm learning all kinds of things that's so nice when your child teaches you, that's excellent.
Speaker 1:So I don't know about you, but me growing up, my dad would just be very grades oriented, so nothing artsy. If it has to do with sports, it was okay, because my uncle was a basketball coach, so that was okay, that was sanctioned, right. But anything that's artsy, anything musically inclined and was I'm still very musically inclined it was like is this going to get you good grades? No, no, I'm not spend money on that. Like all right, dad, that's his Arabic accent, just to be clear what accent I'm putting on. So, yeah, it's all about the grades. So you were just saying you didn't have that chance when you were a kid, so it's nice that you're offering it to your child.
Speaker 2:Yeah, and it's really really fun and exciting. And then also being able to like coming from as a bookkeeper because I can offer certain pieces of advice and things if she decides. Oh well, hey, I want to be a working artist and I want to do all these things because I know her and she would need me to support her on the things that she doesn't like. So that works. That's how it's supposed to be.
Speaker 2:If you don't, like something don't let me do it Exactly. How old is your daughter? She is 14. So she just started high school.
Speaker 1:Oh, my Christmas. What a lovely age to have a mom like you. That's lovely, yes, it's so good. So you left the corporate world and you were like, all right, bookkeeping hit me. Then what happened?
Speaker 2:Well, so it took me a minute to like really get started, because you know, you know, especially when you come out of the corporate environment, you don't really know what you have to offer and you're just like. You're like I don't really know if I can do this, or like am I going to find clients Like what is going to happen and what do?
Speaker 1:I do now. Exactly the day after I left my corporate job, I was like, yeah, who's what do I RB, my dog RB? And then someone managed me, please Exactly. Oh shit, you know, when you go to a restaurant and there's like a million things on the menu and you're starving, you're like can someone choose something Exactly?
Speaker 2:Yeah, that's the really I get that. Yeah, exactly. So you know, in the beginning, really trying to figure things out, and I ended up signing up for a program, a bookkeeping business program, to help me get started and really get going, because I just, I was completely lost and that program really helped and I was so, so excited that I could get things going. And you know, I started getting clients and then I was like oh okay, I'm doing it, like it's, it's working People want to work with me.
Speaker 1:People love you. I send you a comment. This is like energy.
Speaker 2:That is what I've been told and I didn't. I didn't really realize that or think about it before. Hey, no, mmm, yes, okay, mmm. But I'm like now because that's that's all the feedback I get. They're just like yeah, I just love me, so like it's just fun to be around.
Speaker 1:I mean numbers. Numbers are unpleasant, right, like yes, I do money but I don't do numbers. I do do numbers with my clients after we do money healing. We do like the we. I anti budget them pretty much like I Deconditioned the budgeting out of them. So we get into numbers there. But in general, when people are told to look at their taxes, look at their books, look at their numbers, it's, it's icky, it's like this moment of truth and you want someone that Makes it light and makes it happy and makes it into this like nice light moment, like you do, even though you are pretty freaking serious about what you do, you know right.
Speaker 2:Oh, I am very serious.
Speaker 1:We need a friendly face and a friendly voice because all the time, every, every time I would go to Go and get my taxes done on my books done, I get this like really bored looking person that just wants to like shit on life and hates everything and just grunts answers at me and my the tax person I work with now oh my god, I love him so much. He is the coolest person ever and you know I I do my own books but as a bookkeeper I feel so comfortable sending my people to you because I know you offer that comfort, that safety of you, know you answer questions and you're not granted, you know, like Memorized answers back at people and shame them for not doing their books or whatever. That's a very big one that you know. Do you feel also that there's a layer of shame that you have to kind of hold people's hands through?
Speaker 2:Yes, and, and that's something, it's something that I recognize because I know that the industry like when you think of the accounting industry is it is, it's bad, it's just bad all around, like there's no personality. There's you, you. They don't treat people like they don't treat people like people. I'm like these are still people and they they're just not comfortable and they don't understand this part of you know, their business, or just numbers in general. And it can be very scary and I always keep that in mind because I'm like, yes, I love numbers, I understand them and it's fun for me, but I know that's not where everyone comes from. But not every, not everyone approaches it that way. They're just kind of like, well, this is what it is, you should know this. And no, they don't they, they don't know.
Speaker 1:That's why they're coming to you and ask it also comes from this, this like expectation that we're all like come out of the womb. No me knowing money and numbers like exactly who here. I learned about bookkeeping and accounting and taxes at school because I didn't for sure I learned algebra. That really is so good for me every morning. I'm sure it's like perks. You know why? I don't think I anyone learned these things and yet we all feel shame and dread and like I'm not good enough Feeling, and we all have to understand that this is an acquired knowledge. It's not something that we're born with.
Speaker 1:I mean, there are some weird people like myself and you that love numbers, but we have to learn Exactly to learn exactly right exactly and some of us want a little bit more Handholding and some of us have trauma around money and wounding around money that need even further handholding right.
Speaker 2:So, it does come in levels, right so and that's the thing meet, meeting the person where they are. Because I've met all ranges of people like people who are just like I Haven't looked at my numbers and I don't know how long and I'm afraid to look at them. To people who are like oh, I know what's going on.
Speaker 1:Like I just need somebody to do it like.
Speaker 2:I got it, and so there's a range of people and there's a variety of different things that everyone is dealing with and how they feel about Numbers and money and all of that. So that's what I keep in mind and just approach the person that's like actually in front of me. If this is someone who I can tell needs a little hand, like a human Exactly, I will give them the hand holding that they need. If it's someone who's like you got it, don't bother me. I'm like, okay, I got it, I won't bother you. I'm so. It's. It's understanding the person, and most accountants and bookkeepers in general, they just they're just like okay, whatever this is, this is this person I'm doing their books and yeah, it's just a number, it's just number.
Speaker 1:Person is a number, their number is a number. There's no emotions or anything to get numbers, and that's so not true. That's the actual problem with with money these days is that it's deeper than numbers. Yet the majority of people just look at it as numbers. They don't look at the person or the emotions or the like, the story behind the transactions that they see right, exactly, and that's that's where I want to come in and really support people.
Speaker 1:That's why you're here on the money healing podcast. So why should business owners even look at their numbers? You know you mentioned looking at numbers, and why do you think people should look?
Speaker 2:at their numbers. It is the foundation of your business. So it's just like you have a house and your house is built on a foundation. That's what your bookkeeping is doing for your business. It doesn't matter what else you're doing in your business.
Speaker 2:If you don't really understand what's happening and what's going on, you can't really make decisions. So say, for instance, you're trying to plan I don't know, maybe you're gonna Hire someone for marketing or something You're like well, I want to put some effort into marketing. Well, how much effort should you put in? Do you know? Like, are you even bringing in revenue right now? Or how much do you have available to spend on that? Like, these are the answers that you'll get from your bookkeeping, and most people, most people just think oh yeah, I just need to do my bookkeeping for taxes and I'm like yes, you do need them for taxes. That is part of it, but it's something you need all throughout the year as you're running your business, because it will help you to make the best informed decisions, versus just kind of, you know, playing it by ear, like like you know, most of us usually do which is like Well, just played by your.
Speaker 2:I figured out later. But when you actually get into the numbers and into your books, you can see, oh, maybe I'm not charging enough and I actually need to charge more so that I can, you know, cover my expenses and then pay myself and all the other things that come with running a business.
Speaker 1:I like to always say and tell me if that's something that you would also that you agree with as well. So I like to. When people come and ask me, like, how do I price myself, especially business owners or service providers I like to work backwards, so I tell them to calculate their Personal, what we call needs, which is like your mortgage, your rent, your bills, your groceries, your doctor appointments, everything that like is a must have and then you Double that. So let's say, your must-haves are like 3,000. You double that, that's 6,000. That is your. You know, that's the what you need to make just for you, and then add on your business expenses and a little bit of a savings for your business, and that's how you determine how much you price.
Speaker 2:Yes, yes, that is that's, that's the same approach I have to. Okay, yeah, because people are always like, well, how should I price? And I'm like it's going to depend on you, because I'm like someone who maybe they're living a different lifestyle, maybe someone wants to live the luxury, luxurious life, so they're gonna have different needs and wants, versus someone who does it, and so someone has like 14 children, versus you have no children.
Speaker 1:Exactly, I mean, my dog's very expensive. She only eats organic food, don't you IBS? But like I would probably assume that me and if I have a neighbor who has 10 children, they probably they might have more expenses. Therefore, if we're both running the same business we have, we might have very different product suites, right.
Speaker 2:Exactly, and I'm like that is the absolute best way to approach it and that way you can get a real number that's actually going to make sense for you. Yeah and yeah, that's one way of calculating your number.
Speaker 1:Of course, there's like the energetic way of like how does it feel and if it makes sense, and who your target audience is and what Do you think they would pay and the value they're getting. Blah, blah, blah, all that stuff. But from a numbers crunching perspective, that is a very good way of looking at pricing yourself. So Let me tell you that I worked in accounting For a very long time before I started my business. Yet Yet I was quite resistant. No, okay, like I don't think a resistant is the right word.
Speaker 1:I didn't know when it was time for me to switch to QuickBooks. Oh, so for the first many months, I tracked everything on a spreadsheet, not because I thought I had to, but just because that's how my brain works, like, put it on a spreadsheet, you know that's the way you think, I think spreadsheet. You know I think in cells, right? But Coincidentally, that was exactly what at the time. The bookkeeper needed to stop my my QuickBooks because I didn't have, like, I didn't know how to use QuickBooks. I used different versions of that for bigger corporations, right?
Speaker 1:But, I was quite like I didn't know when is what time exactly in my First year of entrepreneurship Do I make that switch? So what are your thoughts on that? Or not necessarily QuickBooks, like any bookkeeping?
Speaker 2:Yes, although I am a QuickBooks person, but any bookkeeping software. So my opinion is Sooner the sooner the better, mm-hmm. So spreadsheets are one like I love a good spreadsheet too. And Look you can. You can do some wonderful things in a spreadsheet, yeah. But when it comes to your bookkeeping it's gonna be very manual. Yeah, it's gonna be a little tedious, it's gonna take time. When you use software it's gonna take some of the manual out of it and it's going to make it easier to like run reports, the reports. You're going to need a lot of reports. Yes, you can just click a button and run a report versus in Excel or you know a spreadsheet you have to. You're gonna have to build it like. It's not gonna be readily made.
Speaker 1:So I wasn't like it was nothing fancy, I was just tracking, yeah right. But I was like, oh no, it's too early for me to go on QuickBooks, too early for me to go on QuickBooks too early. I'm like when is, when is the right time?
Speaker 2:So as soon as possible as soon as possible and because the thing about it is too, even when you're just starting out and you maybe you just have like a handful of Expenses and maybe a little income coming in, that's a great time to actually kind of learn when things, when it's not so overwhelming and you have like tons and tons of transactions coming in at one time Okay, maybe you have five transactions this month. You you'll know how do I categorize these five transactions to make sure they're not when they become 10.
Speaker 1:Exactly, you know what to do, because you know what to do with five. Exactly what I tell people that go like, oh, my income is too little for me to track it and create the buckets. I was like, no, no, no, but this is a very good time for you to do it while it's still simple, because it will. It will multiply and once it multiplies you're like, oh shit, you know exactly. You know, do it now before it gets complicated. I love that answer.
Speaker 2:Yeah, I thought that's, and I don't think most people think about it there.
Speaker 2:They're just, they're thinking of it as, oh, this is an expense I don't need to incur.
Speaker 2:But it's like if you're really trying to, whatever business you're trying to build and you want it to grow, you won't really know without having the data. And when you use a software, it's going to help you Gather the right data that you need. And, yeah, when you have that data, then you can make a decision on well, okay, I'm right here, now I want my business to do this next. Well, now you actually have some information, like now you can actually see clearly this is how much is costing you to run your business. This is how much you're spending on software and apps, this is how much you're spending on office exactly. Then you can say, okay, knowing this, I know I need to make this and I need to do this, and you can actually make the real decisions you need to make to move your business forward, versus just trying to like figure it all out and just say, well, I'm tracking it on a spreadsheet, so that's good enough and I'm like it's good, but it's not good enough.
Speaker 1:So which brings us to the tea, the big tea taxes. So let us tell us what. From your perspective, what is the correlation between a stress-free tax season for a business owner and perfectly kept books?
Speaker 2:So, when it comes to taxes, one thing to remember is you need good books to do taxes. So no tax professional is Going to want to. They're either not going to want to touch it or they're going to charge you extra if your books aren't in order, because they need good, clean books so that they can file accurate taxes. So that's why it's important. So, whether you're doing it by yourself, whether you have someone doing the bookkeeping, that's why it's important, because you can literally just take it, hand it over to them and then they can file the taxes Very, very easily. And that's what. That's what we want. We want them to just Be able to do their job. And then also Another layer of that, because most people just think of oh, I need to find my taxes at the end of the year.
Speaker 2:Well, you can actually plan for your taxes. Most people don't think about that. They're like I just do it once a year, but you can actually plan for your taxes throughout the year by Maintaining your books, because you can look at your books and say this is where I am right now, this is where I plan to go, and you can work with your tax professional and say hey, what, what is my situation look like and what do we need to do? What strategies can we use to help make my tax situation the best? And that's something to keep in mind.
Speaker 2:It's your tax situation. No one's is the same. So, whatever advice you know, you see, or strategies, it doesn't really matter because it's going to be very custom to you because your tax professional, they get to see your full, your full story. So they get to see if you have spouse, if you have children, if you have, you know you investment, all these different things that you might have. They'll see the whole picture and then they can help you plan around that Versus just taking random strategies and saying, oh yes, I'm going to do this because I saw someone said we should do this. It's like, no, your bookkeeping is going to give you the information that you need. You can provide that to your tax professional and then they can work with you and figure out what is the best route for you to take for your tax situation.
Speaker 1:Yeah, there's something that I keep finding very confusing is like why? Why do people do their own taxes? There are people that go and study this as like this science. Then people come to me feeling bad because they're unable to file their own taxes. I'm like you're not supposed to. I don't think you're supposed to.
Speaker 1:I mean, there's some software like TurboTax or whatever that makes it simple. If you're like just you've got your one income, you're an employee and you get a piece of paper and your employer puts tax away and blah, blah, blah, that's simple enough. But when you're a business owner and your spouse is a business owner and you've got W9 income and W2 income and all that stuff, or regardless what the document is, the documents are called in your country. Wherever you're listening, there are people out there that do this for a living and will do it way better than you will ever do it, because that's their specialty. They will be able to save you money and teach you things on how to be more savvy going ahead in your business, because that's their job.
Speaker 1:I really, really recommend that everybody set money aside throughout the year, have a bucket for your accountant and for your big bookkeeper, so that it's a tedious pain in the ass thing that we all have to do, right, death and taxes. But we can preempt the taxes part because we got to pay it and we feel such heaviness when we haven't done our taxes in years. It's so heavy, it feels like you're doing something wrong. It feels like, oh, it's not a nice feeling. So, even if it's like this thing, like the dentist, you got to do it. And safer and get someone good, get someone you feel safe with to do it with you Exactly For you, someone you trust, right, so someone you can email throughout the year.
Speaker 1:Some tax agents, some tax accountants, they do that Exactly.
Speaker 2:And that's probably one of the most important relationships that you'll build is one that you'll build If you have a bookkeeper the one you build with them, and then also the one with your tax professional, because usually those are the people that probably stick around the longest when it comes to your business. Other people they come and go, but those are ones that are usually pretty constant, and so you want those to be great people that you trust and you don't mind being vulnerable with, because they're going to know it. You don't even have to tell them.
Speaker 1:You don't want to know because they're going to see Exactly so, like my tax person, oh my God he. I would trust him to babysit RB, that's how much I trust him. He'll be like I have children. Nadine, I don't want to come babysit your dog, but that's I'm just trying to say like I really feel like it's very important and it feels much nicer to have that, you know, that kind of relationship of trust. Tell us about the most common mistakes that people do healers, coaches, practitioners do when it comes to bookkeeping.
Speaker 2:I want to say there's probably two, two really really big things. One the first one I see it all the time is they don't reconcile. Oh, okay, they don't reconcile. When you reconcile, what you're doing is you're checking, like your bank account, your bank statements, versus what you put into your bookkeeping software, because you want to make sure that it matches, because if it doesn't match, that means your numbers are probably wrong, and if your numbers are wrong, that means your taxes are going to be wrong, and then that means you also have incorrect information that you're trying to use to make decisions. So that is like a very, very important piece of the bookkeeping process that I see business owners who are doing their own books. They skip.
Speaker 1:I skip it. I skip it, I do it. I go back and do it once every six months, but I don't do it on a monthly basis. I feel fine. I mean, my expense is an income. See, here's the thing. I track everything on a spreadsheet, right, and I do my bookkeeping. So it's like every six months I go and check in the numbers and I'm like I'm good, exactly. It's like no, you're not.
Speaker 2:Well, because not only are you double checking the information, but you can also catch things. Say, for instance, maybe you signed up for a trial on something and you're like, oh, I'll test this out, but then you forget to cancel it and then you've been charged for like six months and you forgot about it. Catching little things like that is also a good way to do that when you're reconciling. So it's just, it's verification, but it's also just kind of double checking and catching things.
Speaker 1:Finally, add in as well with the whole process of reconciling. It is a good check in with your body as well, to be like check in how your body feels about every expense that you reconcile. Does it align, does it not align? Does it feel gross? Does it? Are you doing it for the wrong reasons, like, are you doing it to please the person that you're buying from? Is it something that used to turn you on before and light you up, and now it doesn't? Do you need to like unsubscribe from it? Do you need to look at a different service, for example, because somehow your body's like no, this is not the right thing. So this is a very good time to check in when you're reconciling. Yeah, it is.
Speaker 2:Yeah, and then the other big big thing that I just I want people to have more comfort around. It's just asking for help by the time people ask for help it's not too late.
Speaker 2:But it's just like all these things have happened and you're like, okay, I'm ready to get some help now. And then we go back and clean things up or try to get things in order. But if you reach out immediately, like as soon as you have a question or as soon as you even have the thought, you're like find someone that you can just even if it's just asking questions, even if you don't need them to do anything just sit there and answer questions for you, that is very, very valuable. Because if you find a good person who will want to sit and answer your questions and give you the resources or referrals, whatever you need, that's going to put you so much further ahead than anyone else who just kind of sits and waits, who you know they wait, they wait those three years, but then you're already starting off from a good place because you're like I'm getting the information I need, I'm connecting with the right professionals, I am setting myself up for success because I'm doing this from the jump.
Speaker 1:Yeah, exactly. So back of house. Meanwhile, back of house, what happens before somebody reaches out to a bookkeeper or a text person? There's a lot of emotional turmoil.
Speaker 1:That happens that I help people this is one of the reasons people come to me is that my books are out of order, I haven't filed my taxes and from my perspective you know, you probably know what I'm about to say it's a symptom of a money wound, right, it's not. This is not the problem. It is a symptom of a bigger problem. Exactly what are you making that mean about you? You know, what are you? What expectations do you have of yourself? And how is this related to your sense of security, worth safety and all the good stuff, right? So that's where, sometimes, if you're really really like unable to, even though you know and you have like somebody's information and like there you have a tab always open on their webpage and you're like I'm about to ask them and something is stopping you, I would say there might be some kind of wounding happening here and just to ask yourself deeper questions. Because that's what's happening sometimes we don't reach out and ask questions or we don't reach out and get the help that we need because we're scared, or maybe just because we've dealt with someone before.
Speaker 1:That was not very nice, like I remember, I had a really bad dentist episode. Sorry, I'm just like. I'm like comparing bookkeepers and tax people to dentists and dentists. I love dentist now, but I did have a very bad dental appointment 10 years ago and I neglected my teeth for three years and it just kept on getting worse and worse and worse in my head and then when I went in I had to like take out for who was the empty that was. It was hell. And then it went back into like, oh, I'm never going back to a dentist until I found someone I trust and all of that stuff. So I understand when you've been, you've been hurt before by a bookkeeper. These people are nasty. I'm kidding, everybody can be right, like everyone can. You know depends on how much of your humanness and your sensitivity that you bring into your interaction with people, right? So, yeah, so how can someone learn bookkeeping, not as a professional, but just to do their own books?
Speaker 2:There's really, I think, the best way to learn because there's plenty of like courses and things and there's there's many ways that you can do it but I guess one first check in with yourself to understand how you best learn something. Some, some people might be fine to like buy a course, they can walk through it and they'll be fine. Some people might actually just need to meet with someone, meet with a bookkeeper, someone who is a professional and can actually walk them through it, and I've definitely had clients that that's what they need. It Like I offer a service where that's what I do. I show you how to do your books and I enjoy doing it. Like I love to show people how to do it, because not just I want, I want you to know how to do it and understand it and be able to do it on your own as long as you want to, but also I think about, like future wise, what if you get to the point where you can't do your bookkeeping anymore? You have to hire it out. When you get to that point, I want you to feel confident and comfortable so that not only are you handing it off and you're like I know what's happening in my books, but you can provide a little bit of oversight to that bookkeeper so that it's not just them doing whatever, because that has definitely happened.
Speaker 2:I've heard many, many horror stories. So not just kind of like throwing off to someone else and you you're just being completely blind to what's happening. But you can hand it over and you know, I know what's going on in my books. So if you, if something is off, like I know, or I can ask that question and say, hey, bookkeeper, this doesn't look right. Can we double check this? That's what I want business owners to have the confidence to do, because I literally have a client like that. She's like one of my favorite clients because she tracks. You know, she tracks her own stuff, you know as she should and I'm doing her bookkeeping. So like if something looks off, or she's like, oh, this income goes to this income category versus the other and I'm just like, oh, I love that.
Speaker 1:I'm like for me.
Speaker 2:I get excited because someone is kind of, you know, double checking me. I like to, you know, make sure that it's because we want to do right, you don't like dump your stuff on your bookkeeper like here, take it, I don't want to see it.
Speaker 1:I totally agree with that. Just like you know your numbers and it's really cool if you know how to do them. If you don't, if it's not your thing, it's also no shame, right. But like just knowing your numbers and knowing what you're aware of, like I had a bookkeeper years ago, years and years ago, and she would just like message me about a number and I'll know exactly what it is. I'm like no, this goes there Exactly, you know, because I used to be you, I know what's happening in the book.
Speaker 2:And that's the thing too is like really just being in touch with your business and your numbers, because it is yours, it's your business, so you want to be in touch with what's going on and what's happening so that you can provide that information to a bookkeeper or to anyone that's asking. So if anyone were to say, hey, you know how do you earn revenue, you can literally just say, oh, I do this, this and this, this is how I earn my revenue. Like it's not, it's not something you have to think about, it's just something you know automatically because you know your business better than anybody else.
Speaker 1:Mm Are different income categories taxed differently.
Speaker 2:No, well, it could be, depending on what it is. In general terms, if you just if you have a business and you earn income from like multiple different sources or you have different services, it would all be taxed the same.
Speaker 1:But if it's, if it's something like outside of, like your normal business, there could be something different about it If you had a business where clients paid you for programs and then you got W9 income. They're not taxed differently, they're just coded differently, yeah.
Speaker 2:Yeah, so, like when you set up your books, you can actually code it however you want to code, like whatever you want to see, like, if you want to see these are this is revenue from clients, this is revenue from affiliates, this is revenue from whatever you want to, but it's all taxed the same. Yes, yeah.
Speaker 1:So tell us a little bit about like I'm pretty sure that I'm not the only one here that is a little bit teeny, weeny, a little bit obsessed with buying programs. And you know it is about like working on improving my marketing, for example, or like once a year I do buy like a nice hefty certification program because I like to keep, you know, progressing my, my, my services right, like about eight to 10, maybe more, 15 grand a year where it goes to professional development, and I've got my marketing coaches, my business coaches, blah, blah, blah, all that stuff. So how do we code these and are these generally deductible?
Speaker 2:So yes, so when we think about just in general terms, if we can deduct something one, you should be able to answer the question what is the business purpose? So if you can answer that question you'll probably fine. But in terms of how the IRS puts it, it needs to be reasonable and it needs to make sense. So in my business as a bookkeeper I might have expenses that don't make sense for Nadine because we have two different businesses, but it's still a very valid business expense because I know the business purpose behind it.
Speaker 1:And at the end of the day that's what that's.
Speaker 1:all you need to be able to prove is that there is a business purpose behind it and like as a bookkeeper then that's like a bit of a great area, like even would it make sense, for example, if you as a bookkeeper decides to go and, you know, become more trauma informed, for example, and you do a program and that would be just so that you're more sensitive with your clients? That's exactly that would be like it is seemingly unrelated, but it kind of it definitely is, because it improves your services and it makes you look at your clients from a different angle right, exactly.
Speaker 1:Yes, yeah, okay, so that's, that's a good thing.
Speaker 2:So what about like? So yes, having a professional development or continuing education category, however you want to word, it is definitely something that is perfectly fine for any business owner, and it should be. Every business owner should have some something invested in that area so that they can improve not just themselves, but improve their business as well.
Speaker 1:Yeah, improve and grow and keep up with the trends not trends, but keep up with, like, new research and new whatever it's going on. And yeah, so I like to always like think about I mean, I'm very practical, right so I like to have an end of month checklist and end of year checklist. So, from a bookkeeping, maybe even a little bit of tax perspective, what is a an end of month checklist that you would suggest to our audience?
Speaker 2:So every month. There's a few things you should be doing categorizing the transactions, so putting them in the right place, so reconciling so we're going to compare your bookkeeping software to your statements. Reviewing your reports, so actually open up the reports and look at them.
Speaker 1:Most, people don't look at the reports, what reports?
Speaker 2:So the three main reports would be your P&L, so the profit and loss or income statement, depending on how you see it worded the balance sheet and then the statement of cash flow Okay, another if you invoice, so say if you invoice clients. Another report you would want to look at is an AR aging, because that's going to tell you who owes you and how much is owed to you, so you know who to follow up with. But yes, so actually reviewing the reports and then so code, categorize, reconcile, review, reports.
Speaker 1:That three things. What else?
Speaker 2:Yeah, and then I mean, that's pretty much it, that's it.
Speaker 1:So can you just tell us quickly about these three reports, just so that people don't get flattered. Yes, I love your way of making things very simple, so I'm pretty sure everybody would want to hear your take on these three reports.
Speaker 2:Yes. So your P&L profit and loss income statement. You can hear it any of those ways. That's the report most people talk about most of the time. So it's going to tell you how much money you made, how much money you spent, and then what's left over. So that's whether you have a profit or a loss. That's what it's telling you. That's the main report that we're looking at, because it's probably telling us the most information. It's literally telling us everything we probably need, most of the things we need to know. Yeah, then you have your balance sheet, which it just tells you the status of your business as far as what you own, what you owe, and then your stake in the business. So you'll see assets, liabilities and equity. That's what that report is telling you. So just add a quick snapshot. What does your business look like right now? So if you want to know how much is in your bank account, it will be on that particular report. If you want to know how much you owe on loans, it will be on that report. If you want to know how much money you've taken out, it will be on that report. So that's a good report to look at as well.
Speaker 2:Then the last report, which many people don't really talk about or say much about is the statement of cash flow. But for a business, especially a smaller business, it's probably the most important because it's actually telling you where your cash went. So you look at your P&L, you're like, oh, I made this much revenue, I have this much profit left. But then you look at your bank account and that's not what you see in your bank account. And the reason why is because things have actually happened with your cash that is not reflected on the profit and loss. So you want to see maybe you paid on your credit card, maybe you took money out which is usually the bulk of what it is, because as a business owner, you're taking money out and looking at that, you can actually see, okay, well, where is my cash actually going, so that if you need to make adjustments, then you can make those adjustments.
Speaker 1:But then you also know this is why I don't see that profit number on my P&L in my bank account- Gotcha, yeah, and that makes me think like we should have started this whole chat about how important it is for business owners to separate their business from their personal accounts, yes, and even their credit cards.
Speaker 1:You know like I personally use a personal credit card, but it's only for the business. Exactly, I don't use a business credit card per se, but one of my credit cards is linked to my business, is linked to my QuickBooks, and it's solely for the business. Exactly so do not mix, yes do not mix Do not mix.
Speaker 2:And that's the thing you can do, that it's perfectly fine. Like, yeah, if you say you can't get a business credit card or maybe you just don't want to, yeah, if you already have a card, it's fine, but just use it just for the business and don't put anything else on there and it's perfectly fine.
Speaker 1:Tell us about the process of paying ourselves as business owners.
Speaker 2:So I guess, without getting too much into like too detailed, because it depends on the type of business that you have and how your business is set up.
Speaker 1:In general terms like a single member LLC.
Speaker 2:Which a lot of people are. It's as simple as transferring money from your business to your personal account. That is literally categorizing it and it would be, yeah, an owner's draw. So it's not like rocket science, it's nothing that has to be difficult. It's just making that transfer. And you do want to make an actual transfer and not like just spend the money on your business card. So physically make a transfer, Make a transfer from your business to your personal and you've paid yourself.
Speaker 1:Yeah, exactly. So tell us about what happens with taxes then. So let's say, you make $10,000 in the month of July and you pay yourself like five grand, right? So what happens? Who gets what gets taxed and what happens exactly as a single member LLC?
Speaker 2:So the thing about the single member LLC you're going to be taxed based on your profit, and so how much money you put in or you take out, it doesn't even matter, because it depends on your profit and loss statement. What is that number at the bottom and that's what you're going to be taxed on and that flows through to your personal taxes. So it's literally an extra form on your taxes and it all flows through together so you don't have to do anything special or different. You can take out money. Yeah, I mean, it's not going to hurt you tax wise. It just depends on what your actual profit at the end of the day is. As far as when you get into, like how much you're paying in taxes or ways to save, depending on what that profit number is like, your tax professional might make recommendations to you know, help reduce that liability. But as just a single member LLC, it just depends on what your profit is.
Speaker 1:So if you have a lot of profit, you're going to be paying taxes. But the members draw that comes out of the profit, it doesn't. It's not a like. A profit is yeah, it does doesn't it.
Speaker 2:Yeah, so, yeah. So typically the members draw is coming out of your profit, but yeah, you don't, you don't see it, so it doesn't affect you. You don't see it that way. Yeah, it doesn't affect you negatively, or anything like that.
Speaker 1:Cool. Well, anything else that you would like to add to this conversation?
Speaker 2:Oh, just one little, since I actually have the shirt on. One thing to keep in mind is that, at the end of the day, it's on the business owner to be able to support and prove anything that they're putting on their taxes. So, as a business owner, if you're taking deductions and you're doing all these wonderful things, you would want to be prepared in case of an audit.
Speaker 2:You probably won't be audited Most people aren't, it's probably rare but in the case that you are audited by the IRS, you would want to be prepared, and the best way to be prepared is one having your books up to date and then keeping all documentation, so keeping your receipts, copies of invoices, copies of everything, keeping them in a safe place where you can easily access them so that, if that day were to come, you would be prepared and it wouldn't be a long-drawn out process. It would be very simple because one you've been doing what you need to do, you've reported everything accurately, you have the support that you need to verify everything that you put there, and it's going to just make that process easier, if that were to ever happen. Yeah, we want to prepare like we'll be audited although we probably won't, but prepare like we will.
Speaker 1:Yeah, so I love sending all my receipts to an email address. So just having Nadine Zomot receipts, or I usually send it to a Gmail account of my business and that's where all my receipts go. So let's say, I'm enrolling in a course or a program, whatever. I buy it from my normal email address because that's what I will be using in the login. But then when I receive the receipt, I just forward that receipt onto my receipts email and this way they're all in one place. So here's a tip for you.
Speaker 2:Yeah, that's literally what I do In my email. I have, of course, I use Google, so they have labels and I have a label for receipts.
Speaker 1:Oh yeah, that's what I'm doing.
Speaker 2:Every receipt I get it just goes into that receipt label. If I ever need to find it, I know it's going to be in the receipts label. Yeah, that's beautiful.
Speaker 1:Easily search for it it can be simple, it really can be simple, and if it feels complicated, it just means you need a little bit of hand holding. No shame in that, I mean we just keep laughing that we're both money nerds. But let's just normalize and let's each talk about something that we're not naturally good at. So what are you not naturally good at, Misa?
Speaker 2:Well, let's see. So something that I actually ended up outsourcing this year was a big part of my marketing. It was fun. It's fun and exciting, but it's very, very draining and it takes a lot. And so being able to let someone else do that, especially when it comes to my email list and my blog post I really, really wanted to be consistent and do that, but I'm like I don't know how to write it. I don't really know how to write an email and I really don't want to sit here and try to figure it out.
Speaker 1:And my Achilles heel is the same. I've talked about it a lot on this podcast of like. Marketing does not come naturally to me Right Like I can talk about my business all day long but sit me down and say write something, write a post about your business. I don't know what to say.
Speaker 2:And it's so. It's been really, really awesome because, like I come up with all these ideas, so like I'll have tons and tons of ideas, just things that just pop up, and I have someone who can take my idea and then, like, create an email, create a blog post. It's amazing to see, yeah, like to take my, because sometimes I don't. I don't know where I'm going with the idea.
Speaker 1:I'm like I have this idea and then just bring it home. Yes, that's our natural talent, so we're both really natural with numbers, but we're not natural with when it comes to marketing, for example. No, maybe it's a thing, me, so maybe it might be.
Speaker 2:It might be, and like it would just take me a lot of time. Like, could I figure it out?
Speaker 1:I probably could, yes, but it would take so long, whereas you can create a yummy job opportunity for someone that does it so much better than you. Just like taxes. You know, give it to someone, pay them and yeah, get just. You know that's what they do. That's what happens with marketing as well. So there you go, everyone. You might be very natural at marketing and not natural at numbers. That's why the world turns away.
Speaker 1:It turns it's because some of us are good at things and some of us are not good at other things. So, yes, there you go.
Speaker 2:Yes, and you don't have to do all that Like in the big, you don't have to do all the things. Yes To is exactly. I know some. You know a lot of times, especially in the beginning, we do wear a lot of hats, but there's so many different ways to kind of outsource or like allow help to come in without it just being full force. Someone else is doing it, so just you can be a little creative with how you get the help that you need and not feel like you're overwhelmed because you're doing literally everything.
Speaker 1:That's the biggest mistake new entrepreneurs do, new business owners do, is believing that they need to do everything. You should have seen me turn and build my own website. That was not fun for even my husband and dog to watch. He was like mommy lost her mind. Why is she yelling at a screen for days? So yeah, I totally encourage everyone to reach out to Misa if they need any help with bookkeeping. Where can they find you if they choose?
Speaker 2:to. So if you want to find me, you can find me on my website, so perfectly kept bookscom. I'm on social media, so you can find me at perfectly kept books, instagram, facebook, whatever's, I think.
Speaker 1:Great name. I love your business name. It's just, it's perfect, perfectly kept books and it just suits you. Thank you All right, everyone. Perfectly kept books is where you can find Misa and I hope you enjoyed this episode. Reach out to us if you have any questions and I'll see you all next week. Bye for now.
