Training is your passion, and let’s be honest: you love making money by doing what you’re passionate about. What you probably don’t like is keeping track of the financial end of things. Turning your head the other way from the number, however, will only leave you more frustrated come tax season, when you need to report income, deductions, and spending.
Instead of putting it off and hating yourself come April, keep your finances in check all year long. Here are seven awesome resources and tips for doing exactly that. After a few months under your belt, it will become second nature.
Separate Personal and Business Finances
If you operate a small training business, it may not seem important to separate everything. If your company is an LLC or Corporation, this is mandatory; as a sole proprietorship it is highly recommended by finance professionals:
“By doing so, you’ll save yourself hours of work and make it easier to track deductible expenses. There are applications or software that automatically manage the accounting for crossover expenses. Still, it is strongly recommended to have your business and personal finances handled independently,” advises Chris Benjamin, founder of Rogue CFO Management Consulting.
The process is easy enough to start and maintain: Open a credit card for business use only, pay it with money you make from training, and put everything you bring in into it’s own savings or checking account.
General Financial Organizing
If you don’t want to pay for software for tracking your finances, which is the case for many personal trainers who don’t operate a large business, find another way to keep your finances organized. I use Google Sheets for all of my organization, financial and otherwise. Your Google spreadsheet is available anywhere you have Internet access and is easy to use, even if it’s your first time.
Use the tabs to avoid creating one impossibly long spreadsheet and take advantage of built-in formulas to reduce how much math you need to do.
If you like to keep your financial details and tracking offline, use these templates from Score.org. You’ll find free balance sheets, cash flow statements, and more.
Don’t Forget About Hard Copies
You can keep all of your bills organized online, but don’t forget to file all hard copies of invoices and bills in one, easy-to-find place. When tax season comes around, you can give these to your accountant or use them to double-check everything as you’re filing. Note that if you get audited, you’ll need these hard copies, so don’t toss anything.
Keeping a running record of all your expenses and potential deductions will make it easier to get everything together when it comes time to do taxes or quarterly updates. Use these expense and deduction templates from Curtin CPA; they’re free to download and print. If you like the idea of keeping everything organized online, use the templates as an example for how to set up your online organizer. Deductions could be one tab in your financial spreadsheet.
Do Your Budget Once a Month
You don’t need to re-do your budget once a month, you just need to check and re-assess it. Your small fitness business is ever evolving, and some of the newest changes may affect how much you’re spending or better yet, saving. Sit down for a budget check once a month to get a feel for where you’re at, if you’re staying on track and more.
Pay Bills When They Come In
As a small business owner, you have a lot on your mind and bills are the first things that get pushed aside when you’re pressed for brainpower. Don’t risk the late fees and pay your bills when they come in, if that’s possible. If it’s not possible at the moment, put a reminder on your calendar right then instead.
Talk to a CPA
As someone who’s self employed and owns their own business, you can pay taxes quarterly, rather than all at once at the end of the year. Talk to a CPA about getting this set up. They can provide you with the necessary paperwork for submitting taxes like this and advise you on any other best practices in terms of paying your taxes as a sole proprietorship.
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Jessica Thiefels has been writing for more than ten years and is currently a lifestyle blogger and the editor of Whooo’s Reading and Carpe Daily. She is also the owner of her own small fitness business, Honest Body Fitness, and is using her experience from writing, editing and marketing to become a successful entrepreneur. Follow her on Twitter @Jlsander07.