How to Track Income & Expenses for Work at Home Moms
Work-at-home moms need a system for tracking their income and expenses.Tracking the finances is important for any business, but as a small-business owner this information is crucial. Anyone who needs a way to track income & expenses for work at home moms, even people who are employed but working at home can benefit from monitoring their progress as well.
Why Track Income & Expenses?
It is simple, so you don’t miss a payout.
Things can happen, and for some reason, you may not receive the $250 payout you were expecting from your blog’s ad network. If you aren’t properly tracking your income, you may not realize the money didn’t get deposited into your bank account. Or you may not realize your payout was short, or see the increase in pay you’ve built overtime. Don’t rely on other companies to ensure you are getting paid, make sure you know what you’re earning and where that money is at.
Set a monthly budget for your business
The goal for every work at home mom is to make more profit than she spends. It’s not smart or ideal to be running a business that earns you only $50/month while you are spending $100+/month maintaining it.
In the beginning stages of building your business, this might be a reality. However, as time goes on, the earning to spending ratio should be looking more like profit in your pockets. Tracking your finances lets you see how much money is coming in and going out. With this information, you can create a handy budget that keeps you from spending more than you earn and can even inspire you to find ways to cut the costs of maintaining your business.
To reinvest in your business
As your monthly income grows, you may need to adjust your spending habits or find more cost-effective ways of managing your money. When you are tracking your finances, the growth is easier to see. That way, you know when it’s appropriate to invest in better hosting or outsourcing certain tasks.
To make tax time easier
Tracking what you owe when it comes to self-employment taxes can be tricky if you don’t prepare for it.The IRS requires a full accounting of your earnings and business expenses, but it’s difficult to collect these figures without going through the work involved in compiling them.Tracking throughout the year gives you these details, ready to hand over to your accountant or to put into your preferred tax preparation software.
Use AirTable or Google Sheets
A spreadsheet is a fantastic tool for moms to track their income and expenses. You can easily input all your numbers and then use formulas that calculate everything for you. It will quickly show you how much you are making and spending each week/month, as well as how your business is growing overtime.
You can edit your income and expenditure spreadsheet with Google Sheets from anywhere you have internet access. When signing up, you enter your Google Account information so everything is saved directly to the account rather than a device. This means that you’ll still have the information stored even if something happens to your computer since Google stores it for you…and for free! There’s even a mobile app for Google Sheets that you can download to track your business’ finances on the go.
You can edit your income and expenditure spreadsheet with Google Sheets from anywhere you have internet access. When signing up, you enter your Google Account information so everything is saved directly to the account rather than a device. This means that you’ll still have the information stored even if something happens to your computer since Google stores it for you…and for free! There’s even a mobile app for Google Sheets that you can download to track your business’ finances on the go.
We also created a Free Budget & Expense for for you if you’d like to do it manually. All you have to do it is print it up and it fits get in a binder.
Tracking Income
Check your incoming payments and checks at least once a week. It’s helpful to do it once a day, but if you’re short on time, once a week will work. Many work at home moms have multiple income sources, so you want to make sure everything is properly tracked.
It may also be helpful to note which income stream will pay out when.If you have any type of planner or content calendar, add those days to it and check back for when your payments are due. Ad and affiliate networks typically pay once a month, so these will be easy to remember. Other platforms, pay within a day or two of you making a sale. These types of payments are what make daily tracking of income so important.
Monthly, you can go back and look at your bank account, PayPal account, or any other money-related accounts to make sure you have tracked all of your income accurately. Don’t wait longer than that, or you may miss the payment window and you won’t get paid at all!
Tracking Expenses
All of what you spend on your business is an expense, and ideally you want to make sure that they are tracked just the same as your income. Don’t forget to save those receipts, too. When tax season rolls around, you’ll be happy that you tracked your spending along with your income.
Keeping a separate document for your budget is suggested in order to avoid accidentally misentering expenses into your income sheet.
Group your expenses into categories for your expenses. For example, moms who earn money from a blog may have categories such as hosting, outsourced content, virtual assistants, travel, graphics, and online tools.
Etsy shop owners might have categories that include things like recipe or craft materials. You may even be able to consider a portion of your home’s internet service as an expense if you’re running your business online!
Important: Keep every single receipt for the things you buy for your business. These receipts provide a detailed record of your expenses and should be kept for future reference. Plus, it’s good to have a physical record of your expenses when possible for personal reference and reflection.
Now that you know the importance of tracking your income and expenses as a work at home mom, and how to get started, you should get those spreadsheets created. The sooner you start, the better, because it’s always more difficult to backtrack! If you have any questions or helpful advice for other moms, let us know below.
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