Your laundry is overflowing, your bedsheets are wrinkled, there’s hair all over your bathroom and you don’t even have a cat.
Staying organized is hard! (Just ask Marie Kondo, she’s raking in the dough on our inability to simplify and organize our lives).
If you’re a freelancer or sole prop you’re responsible for keeping your own finances in order and it’s no small job. It can be exhausting working a long day building up your business, and then having to log and file your expenses Who has the will or the time? Yet, it’s essential if you don’t want to screw yourself over at tax time.
Here are five ways to help you track your income and business expenses:
1. Figure out what your legit business expenses are
Don’t waste time recording expenses if you’re just going to have to toss them. Learn what you can and cannot expense and only keep those receipts. This bit of research will save you much time with your spreadsheet.
2. Don’t overcomplicate your tracking system
A simple spreadsheet in Excel or Numbers is the easiest way to stay organized. You can download a template off the internet (We have a great one 😉 ) with just a few columns. If you’re raking in the big bucks you may want to spring for an accounting program like Quickbook or Freshbooks.
3. Schedule in organizing time
Set aside 1 – 2 hours every month where you grab the piles of receipts you have and enter them into your spreadsheet.
If you do this regularly it won’t overwhelm you. If you do it too often though it could get too tedious. Sharpie in ‘ORGANIZING EXPENSES’ in your Moleskine and stick to it.
4. Don’t confuse your personal life
It’s too easy to mess up and add personal expenses to your tracking sheet. To prevent that you need to start using a business credit card for all appropriate expenses and have separate accounts with companies when available. Uber, for example, allows you to have both a personal and business account.
5. Don’t forget to track your income
It’s too easy for a client not to pay your invoice in a timely manner! You must write down how much someone owes you, if you’ve sent out the invoice and if they’ve paid it. That way you can bug clients about paying you while feeling confident that you didn’t accidentey deposit the cheque.
Want to learn more about how to track your finances? Check our our online course:
You’ll learn how to:
- Separate your business from your personal life (with banking plan)
- Learn how to track your revenue and expenses so you don’t have to count receipts at tax time
- Understand what records you need to keep (beside just receipts)
- How to prepare for an audit/review from the CRA (dun dun dunnnnnnn) so that you’d be like “oh, no big deal yo.”