Thanks to all who have helped me on this journey. I am super happy to report that in less than a year of being on BP, my husband and I have purchased our first investment property.
As we begin this journey, we'd like to develop good practices and habits. Even though we have an accountant, we want to make sure we keep accurate and correct accounting practices.
We were wondering if anyone had an outline of where to start so we can start tracking expenses and so on.
Thanks again for all your help. I will be searching on the site here.
@Vera Herlihy - congrats on the first purchase!
There are several third party options such as QuickBooks which you can look up. If you're wanting to put together your own spreadsheet and customize it, send me some details on what you're looking for - I'm always looking for some Excel fun
@Vera Herlihy , since this is your first, I'd start simple.
What I did when I first started was have an ongoing excel spreadsheet and manually enter costs as they're incurred. You can make it as basic or complicated as you'd like. Each year just start a new tab at the bottom and you're done. Then either take a picture of receipts and save them in a folder, or print them and keep in a separate file. i personally wouldn't invest much into quickbooks or a third party- it's very easy and cheap in excel.
@Ben Wilkins thanks for the reply. I'm not great with spreadsheets. Do you by chance have an outline or template you could share with me?
@Mike Verna I'm assuming you do this on a monthly basis, a sheet for each month with the expenses?
Most of your costs will be fixed. (Mortgage, taxes, insurance, etc).
There's lots of options- a simple one if to just list everything in the rows and each column is a new month. If something weird pops up make a new row and throw in the amount the that months column. there's a lot of great YouTube videos that give a basic intro to excel if you're unfamiliar. I'd recommend learning the basics if you don't already. Id always advise you to learn it yourself instead of just copying someone else's... that way you're not locked into whatever template you use.
Excel can do some pretty amazing stuff quickly and easily.
Excel is a great way to get started. Another thing to keep in mind is how you’re going to be taxed. If you’re trying to stay schedule E, just make sure all your expenses are easily accounted for on schedule E, otherwise you may be looking at schedule C instead. Between that kind of diligence, a little excel magic, and separate business checking/savings, you should be good.
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