Over the course of the last year, I’ve gotten asked several questions about bookkeeping for bloggers. Questions like:
- How do you stay organized?
- Who does your taxes?
- Can I do taxes on my own?
- Do I need separate checking accounts?
- Do I need to save all the receipts?
Normally, I just refer people to my accountant who I’ve been working with for many years. However, not everyone is ready to invest in an accountant on a monthly or even annual basis. Fortunately for you, my accountant has put together an entire course about bookkeeping for bloggers (affiliate link). Here’s a quick interview we did where we answered some of your most pressing questions about the program.
Amanda: Thanks for doing this Eric, I know it’s the middle of tax season!
Eric: My pleasure! I needed to take a little break from the numbers anyway lol.
A: So the first question, obviously, is whatis Bookkeeping For Bloggers exactly?
E: Well, in the simplest terms, it’s a way for people to learn the basics of bookkeeping for their blogs/freelance biz/podcasts. It’s a way of teaching people the basics–what makes income and expense items what they are and how to properly track the inflows and outflows of their business. This way, there can be less “I’m completely lost when it comes to my business money” and more of “I actually understand what these numbers represent”.
A: So it’s pretty much like a crash course on bookkeeping?
E: In a sense, yes. Except I skip all of the nonsense that no one needs to know about and only deal with things that directly affect them on a daily basis. Like, for instance, no one needs to know how things were done in the early 1900’s or the different rules that have come and gone in regards to certain taxes. All they really need to know is what is come, what expenses can legitimately be paid out of the business account, and how self-employment taxes affect them (among a few other things).
A: What made you decide to create this course?
E: Honestly, there are a million and one courses/sites talking about monetizing (making money)–affiliate marketing, Facebook ads, Pinterest marketing, freelance writing, etc. (Practically) no one ever talks about how to manage the money, the requirement of paying self-employment taxes, or even what is/isn’t legitimate expenses that can be paid from business funds. I felt like I was qualified to educate people and show them the right way to handle their business†money, and better me than some scammer just looking to sell people on a subpar product they scraped together.
A: That’s great, but why would you do this when you can be getting recurring income by selling your services instead of the one-time course fee?
E: I get asked that a LOT! The main reason is that many people don’t belong paying a professional. I’ve turned away so many people looking to hire me that I’ve lost count. Especially in the beginning when profits are hard to come by and the volume of transactions are low, it’s more sensible to do the bookkeeping yourself and use what money you do make†to reinvest into and grow the business. I simply can’t justify taking money from people who honestly don’t have the need yet.
A: This coming from the person who says to outsource everything?
E: Yup! The only time outsourcing should be done is when it’s affordable. If someone only has a few†hundred in net profits, I cannot in good conscience take half of that. I always tell the people I turn away to give me a call when they start making more money and are in a better position to pay for my services.
A: The key selling point of many courses marketed to bloggers is†making money but you’re selling them on saving money?
E: Well if people truly believe that “a penny saved is a penny earned” then it’s pretty much the same thing, right? So, if I can save people the unnecessary cost of say $200 a month, then I’m essentially earning them that amount each and every month as long as they do their own stuff.
A: Knowing you, I seriously doubt you believe that!
E: Me? No. But I’ve learned that other people do and it would behoove me to get it through my thick skull and adapt! And yes, I did just say “behoove” hahaha.
A: How exactly will people be able to do this themselves when so many aren’t “numbers people”?
E: Let me just say one thing first, and it may come as a surprise to many: bookkeeping isn’t really about “numbers” per se. It’s more closely related to organization actually. It’s like this: the transactions (dollar figures) are your clothes and the income & expense categories are your hangars, drawers, shoe racks, etc. You’re simply trying to put the numbers in the right slots to keep things grouped together with like items.
A: I don’t think I’ve ever heard of bookkeeping described that way before.
E: Honestly, I kind of came up with that analogy very recently. I needed a way to counter the argument when people say they aren’t good with numbers as a way to justify not keeping a budget or having their business finances in line. Plus, soooo many people start to nod off when talking about the boring bookkeeping/tax side vs. the exciting increasing revenue side. I figured it would be nice to be able to relate to it in a more common way.
A: Alright, getting back to the course itself, can’t this information be found online for free?
E: That’s a point I address directly on the course info page. The answer is yes, and at the same time no. A lot of information can be found online free of “monetary cost”. But, that doesn’t mean it’s free of other costs. You can spend hours upon hours searching for answers to all of your questions which takes time, and many people equate time with money. Then there’s opportunity cost–the tradeoff that’s made by spending your time searching for the answers rather than being able to use that time to make money. So in essence, it really isn’t “free” anymore.
A: Fair enough. You also mention something about having everything in one place, why should that matter?
E: It’s similar to the previous point about saving time. By having an all-encompassing source of data to reference, all people will have to do is log into the course to find the answers to their questions. They won’t need to repeat their searches each month, or even waste time doing a separate search for each question that arises. I reached out to a bunch of people to find out what they tend to have to look up online and covered as much of that as possible without getting too far away from the main topic and user-base I intended this to be for.
A: So if I was wanted to know whether or not I can deduct a course, or if I wanted to hire a contractor, those topics are covered?
E: Those and more! It’s broken down into easy-to-consume segments so people won’t get too overwhelmed. I break it down into 10 main categories (money-related, travel, everyday expenses etc.) and from there go into the specific expenses that are deductible a bit more without getting too anally micro-managed lol. And I use real-life examples like actual courses and people who offer services so students can make that direct connection and understand it more easily.
A: You also have worksheets in there as well. Explain those a little for everyone.
E: At the beginning of the Income section as well as the Deduction section there is a fill-in form where students list off all of the respective sources and then as they go through the modules, record what category of income or expense that goes into. The point is to have a blueprint ahead of time so tracking the money coming in and out is easier from the get-go.
A: There’s also a huge spreadsheet in there. What’s the benefit of using that?
E: That’s just something which came about during one tax season. People used to ask me how they should get me the information to put into their tax returns so I came up with a spreadsheet containing the most common income and expense categories I saw bloggers and freelancers requiring. When I was outlining the course, I realized it would be a great add-in for students so they didn’t have to waste time trying to develop their own. It gives students a tab for each month to record their transactions, and from there it automatically flows to other tabs: a month-by-month summary so they can analyze their income and spending side-by-side; a bar chart showing each month’s income and expenses for people who are more visual as well as a line chart representing the year-to-date profit/loss for a different economic view.
A: What if people aren’t familiar with using spreadsheets, how does that help them?
E: Well, I took them into consideration as well, and have a video showing how to use it. It shows how the numbers from the main inputs flow out to the other sections and how it all ties out so the students aren’t blindly using it and hopefully have a complete understanding of how this reflects their finances.
A: I noticed there aren’t any “freebies”, why is that?
E: Honestly, I could have passed off the spreadsheet and the infographic showing the different expense categories in a visual manner as “freebies”. Oh, yeah, there’s also an infographic as a quick reference of the expense categories I mentioned earlier. I just view those as something that should be part of the core–for this particular course–rather than a cheap way to make people think they’re getting something extra.
As you can see, bookkeeping for bloggers doesn’t need to be overly complicated. With a little guidance and organization, you can organize your finances and be ready for taxes. Click here to learn more about Eric’s course, Bookkeeping for Bloggers.