How is your Bookkeeping going half way through 2022?

[Matthew Cervoni]

Hello BP! 

We are half way through the year and I am interested to hear how your goal to have clean & insightful bookkeeping is coming? 

If you're having success, what strategies are you deploying? What software are you using? Are you using a CPA or bookkeeper? 

If you're falling behind, what are your biggest hurdles to making bookkeeping a priority? What is causing frustration or worry? 

[Scott Trench]

My bookkeeping is done in a frantic, miserable last minute rush in the last week of February, cobbled together in a variety of accounting systems that never seem to work well, and then forgotten about for the rest of the year. 

This is the way.

[Bruce Woodruff]

I use WAVE  (free online) and you have reminded me to go on there and import/check/sort data for 2022.

Thanks a lot, I had things to do.....

[Matthew Cervoni]

Quote from @Scott Trench:

My bookkeeping is done in a frantic, miserable last minute rush in the last week of February, cobbled together in a variety of accounting systems that never seem to work well, and then forgotten about for the rest of the year. 

This is the way.

 Scott, 

I am sitting right next to your book "Set for Life" - I'm reading it for my 3rd year in a row! It helps me stay in line with my early financial financial freedom goals, and I'm excited for the revised edition! 

I just finished the section where you talk about managing your passive income and how a duplex that brings in $2,625 per month, you save an additional $265.50 by taking tenant calls and collecting rent yourself. I also manage my rental property myself! 

However, as a CPA/bookkeeper, I've found that one of the best ways to do tax planning is to perform bookkeeping throughout the year for clients. It helps us be proactive! Of course, there are more benefits to bookkeeping than simply tax planning (loan covenant requirements, identifying property performance, owner draws, etc.), but usually the ROI on bookkeeping from tax savings alone is well over 100%, plus the investor doesn't have to spend time getting frustrated trying to do the books.

I'd be interested to hear your perspective! Where do you draw the line between outsourcing tasks and trying to do things yourself to preserve monthly passive income?

[Matthew Cervoni]

Quote from @Bruce Woodruff:

I use WAVE  (free online) and you have reminded me to go on there and import/check/sort data for 2022.

Thanks a lot, I had things to do.....

 Bruce, 

I've used Wave for my lacrosse coaching business just to test the features. I'm a big fan of Quickbooks, but I was definitely impressed with what Wave can do for a simple business with just cash received & cash spent. 

Hopefully you can squeeze it into your busy schedule! 

[Bruce Woodruff]

Quote from @Matthew Cervoni:

Quote from @Bruce Woodruff:

I use WAVE  (free online) and you have reminded me to go on there and import/check/sort data for 2022.

Thanks a lot, I had things to do.....

 Bruce, 

I've used Wave for my lacrosse coaching business just to test the features. I'm a big fan of Quickbooks, but I was definitely impressed with what Wave can do for a simple business with just cash received & cash spent. 

Hopefully you can squeeze it into your busy schedule! 

Ha - I went to WAVE and they had not updated since March. So I had to re-sync....still waiting for the data....

But thanks for the reminder!

[Basit Siddiqi]

Quote from @Scott Trench:

My bookkeeping is done in a frantic, miserable last minute rush in the last week of February, cobbled together in a variety of accounting systems that never seem to work well, and then forgotten about for the rest of the year. 

This is the way.

I hope this suggestion helps if you plan to do your bookkeeping once a year.

Create a drive with an online storage provider(Google Drive, Dropbox, etc)
Take a photo of your receipts / expenses and save the receipts in a folder within your online storage provider.
I find it helpful to save the name of the file as "date_Purpose_Amount" so I might save a file as "7.8.22 -Utility - $150"
This way you can refer back to these files when you do your books later.
I find it hard to just rely on bank statements / credit cards as they just tell you the name of the store you made the payment to but not the actual expense description.

This will also help you in the event that you ever get audited.

[Bruce Woodruff]

@Basit Siddiqi You mean you are still supposed to keep receipts? :-)

[Basit Siddiqi]

Quote from @Bruce Woodruff:

@Basit Siddiqi You mean you are still supposed to keep receipts? :-)

 The good thing is that you don't need the actual receipt itself but you can take an image of the receipt.

[Bruce Woodruff]

I know, I'm kidding....I've never been very good at the receipt thing..... I figure if I get audited, I'll just bring in all my bank statements and go through them :-)