204 – Be Friends with Your Numbers with Lynne Somerman Financial Coaching

Hi there.

You're listening to gift biz on rapt episode 204 at its

core. What you're trying to do is just keep a record

of where money comes from and where money goes and why

At Tinton gifters,

bakers, crafters and makers pursuing your dream can be fun.

Whether you have an established business or looking to start one

now you are in the right place.

This is give to biz unwrapped,

helping you turn your skill into a flourishing business.

Join us for an episode packed full of invaluable guidance,

resources and the support you need to grow your gift biz.

Here is your host gift biz gal Sue moon Heights.

Hi there,

it's Sue And thank you so much for joining me here

today. As always,

today's a really special podcast because we're approaching a topic that

you guys have asked me for over and over again,

whether it's in comments in gift biz breeze,

the private Facebook group or in maker's MBA,

our signature course.

A lot of questions come up about how to handle money

and so often people just want to ignore it,

shove it to the side and not face it,

and you know what?

When you do that,

then you're setting yourself up for if not big trouble for

sure. A lot of extra time involved,

getting prepared for taxes and honestly not really having a pulse

on your business,

how well it's doing,

or areas where you need to improve.

So lucky for us,

I have Lynn here who's going to talk through how to

start understanding all of the dollars within your business,

what tools you should use,

and a very simple accounting formula that will let all of

us just go.

We can just breathe.

Numbers don't have to be so hard.

They can be our friend.

Before we dive into the show,

I want to tell you where I believe we are going

to be at the time this podcast goes live.

I've been sharing with you over the last five or six

episodes or so that I've had something really exciting in the

works and that is a daily planner made specifically for you

gifters, bakers,

crafters and makers.

I didn't know it was going to take as long as

it has to actually get them all printed up and have

them available,

but this is the week that they should be ready,

so I'm super excited to share that with you.

I'm recording it now,

hoping everything stays on time in preparation for that.

I've also created a video that gives you an inside look

at the planner,

but even more than that,

I go through what has become a for me in terms

of productivity in my business and that is what I've termed

the power of purpose.

People often ask me how I get so much accomplished in

my days and apart from being a little crazy and Morgan

a lot of hours,

what I do is employ the power of purpose to make

sure that all the time I'm putting in is getting the

most reward.

I'm using my time as efficiently and properly as I can

and I do that through the power of purpose.

I invite you to watch this video.

It will share with you the concept of the power of

purpose and it ties wonderfully into the fact that you're going

to want to schedule time to do your new numbers,

your new friends,

right, that you're going to know about from the show,

and then it also goes into what the new inspired daily

planner is all about.

If you already have a planner that you're using,

no worries at all because a lot of the concepts that

I lay out can be applied to bullet journals or whatever

other planner you have.

I bet you're wondering where you can get your hands on

the video.

Just go to gift biz,

unwrapped.com forward slash.

Planner I guarantee you you're in for a real treat and

now let's get to the topic at hand,

bookkeeping numbers,

how to make it work for you and your business.

You're going to see.

Lynn just has such an easy calm way of talking and

this is the perfect approach that we need to understand how

to implement this into our businesses.

Let's roll Leisure of introducing you to Lynn summer.

Men of Lynn Summerlin financial coaching.

Lynn helps entrepreneurs feel less stupid and sad about their money

through practical skill building,

habit change and mindset work.

She speaks about budgeting as radical self care and loves coaching

clients and seeing them light up,

realizing that they're not doomed after all.

Lynn lives in South Portland,

Maine with her feisty daughter,

snaggletooth dog and chickens named after strong woman.

Boy, if that doesn't get your attention,

I don't know what does.

Welcome to the gift biz on rap podcast.

Lynn, thanks for having me,

Sue. I'm so excited to be here.

I am thrilled that you're here too.

I think this is going to be a really fun and

lively conversation and when people hear that it's about money,

they might be,

well, I don't know about that,

but gift is listeners.

I guarantee you this is going to be a lot of

fun and you are going to learn a ton.

I'm not like your usual finance nerd.

No, I could tell that from the second I met you.

But let's share with our audience a little bit about who

you are through a motivational candle.

So if were to describe The color and the quote that

would be on a candle that is aligned with you,

Lynn, what would it look like?

I think this is such a fun question by the way.

I don't think I've ever been asked anything like this on

a podcast before and it really got me thinking,

I'm like,

what color would I be?

And I actually was just in a Yankee candle this weekend

with my daughter and I was like,

which of these candles best represents my spirit?

So I think the color would be,

I've been really into this like Marigold color recently because it's

sort of fresh and fun and bold without being shallow.

It's rich and interesting.

I'd take everything about that.

So I think the color would be like this rich Marigold

color. Beautiful.

I see that in you already.

Bright sunshiny et cetera.

Yeah. And so what about a quote or a mantra or

saying that would also be on your candle?

So my favorite,

I'm actually a huge lover of inspirational quotes,

which makes me feel sort of like cheesy,

but I just really love them.

But there's only one that I've got framed in my office

and it's a quote from lout Sue and it says if

you do not change direction,

you may end up where you're heading.

Ooh. The first time I heard that I was like,

Oh right where exactly.

Like where am I heading?

What have I done sort of in my life?

What is sort of like the likely outcome of what I'm

doing right now and is that what I wanted to do?

And I love sort of keeping that in the back of

my mind,

working with clients and working on my own business.

Like what is the likely outcome of what I'm doing right

now and what my clients are doing?

Is that what we wanted or will want to be intentional

about it?

Love it.

You know,

it sounds simple but there are so many people who are

doing, doing,

doing, doing,

doing, doing and then when you ask,

well what's the end result?

What are you looking to achieve?

They have trouble putting it into words.

Yeah, absolutely.

And I've been guilty of that too.

Oh yeah.

We do all the time.

Which is why I don't think it's ever like ever stopped

doing it.

I think it's just about awareness building so that you can

sort of see it while it's happening before it you've sort

of had the consequences and go Oh right,

I'm going to get back on track for the thing I

actually wanted to do rather than like the default way of

being. Yeah.

Being intentional with what you're doing.

Yeah. Cause it can be a lot of waste of time

too. Absolutely.

We get stuck in doing things that we find are easy

and then we don't do the things that we really need

to do that will advance the business.

Absolutely. I do that all the time and I think that

falls within our topic to actually absolutely numbers.

Except if someone's handing me like a bill or a penny

or I'm exchanging money for something,

I want numbers to me and bookkeeping and all of that

get really scary.

So, and I'm sure a lot of my listeners feel the

same way as do all fine.

So well yeah.

Cause that's why they're your customer,

right? They're our clients.

Give us a little bit of a backstory.

What led up to the wiser miser?

My background,

so I have an,

so I studied business,

I really love accounting.

But my background before grad school,

I have an undergraduate degree in sociology,

which if you don't know,

is basically just the study of human behavior in group settings.

So like why do we do the things that we do,

which I just really love studying the way that people behave

and all of that stuff.

And the short story of how I really got into this

was that when I finished college,

I had like the great American dream of tons of student

loans, a credit score in the toilet and like a shiny

new credit card debt that I didn't know what to do

with. I think that's a nightmare.

It's like sort of like everybody,

it's like go to college and everything will work itself out

and it didn't work as was the story for a lot

of people.

I say tried all the things.

Some of them worked,

some of them didn't.

Some of them worked well when combined with other things and

I started informally coaching friends and family over the years and

the words sort of spread from there.

Well you weren't calling it coaching then,

right? You were just like,

Hey, let me help.

I'll help you.

Exactly. Eventually someone was like,

well, how much do you charge to do this?

And I was like,

I don't charge money for this,

but I loved doing it.

So I started doing that a little bit more and then

in doing that work I realized there was really significant need

for business people and people who are self employed and who

had sort of a side hustle to understand.

They might go out,

my personal finances are okay,

but maybe not where I want them to be,

but I really don't understand business finance.

And I was like,

Oh, I can help you with that.

You know,

I started accounting.

I have a master's degree in business.

I can help you read a financial report without having a

mental breakdown.

I actually started adding that into my coaching and I started

a bookkeeping business,

which I don't do a lot of that anymore.

I do have,

I have a couple of bookkeeping clients and we're probably doing

a little bit more with that this year,

but really just getting into like how can I help people,

like you said on the intro,

feel less stupid and sad about your money and I really

specialize in working with people who are self employed half their

businesses because I think there's like an extra level of identifying

our own self worth with the size of our bank accounts

and just an extra level of complexity when we're really good

at the thing that we do,

but we don't necessarily know how to read a financial report

where maybe we can read it,

but we don't know how to use it to make financial

decisions or we don't know how to get started doing our

bookkeeping. What do we even need to be paying attention to

when really we didn't get into it because I love making

candles or something,

which as a side note,

I'm excited to be on your show because I actually really

in another lifetime I used to be like an artismal candle.

Candlemakers You did.

It feels like a very,

very long time ago now,

but there was a time in my life where that's what

I did and I actually really thought about doing that as

that was one of the first ideas I had for like

I'm going to make this my business and it didn't end

up being what I did.

Obviously this is what I do now,

but so I have a lot of love and respect for

the makers in the world doing what they do.

Oh, love that.

Well, you are the right person for us to be talking

to them for sure.

I think when it comes to numbers and finances,

and people have said this before,

like there's no course on how you're supposed to run your

Life. And personal finances are one thing.

And clearly you can get in a heap of trouble if

you're not doing some type of bookkeeping or accounting for personal

life, which I think we kind of all forget.

But then when we go into business doing what we love,

right, you still have to do all the other things,

right? And it's not optional the way it is in our

personal finances.

Right? And so we get into candles or making cakes or

whatever it is.

But the thing I remember that you said Lynn,

and I don't know if you remember this,

but we were chatting over dinner.

You were talking about all of this because I was kind

of like wondering if you should be on the show,

because I've had my audience asking about bookkeeping and I'm like,

Oh, she may be my girl.

Like I gotta find out.

And the one thing you said that I loved so much,

you were sharing with me your story a little bit more

than what we're talking about here cause we want to get

into the guts of it.

But the thing you said to me is,

and then I realized that I can do what I love

every single day of my life.

And that is what you're doing right now,

helping people with their finances because it comes so easy to

you. Yeah.

So so many of our listeners,

what they're making comes so easy and we want them doing

more of that and not get caught up in this.

Absolutely. I'm a huge believer in doing the thing that you

do best and then figuring out a way to simplify the

other things that are important.

Like your finances are important.

You absolutely should pay attention to them,

but you don't need to be a finance expert.

You just need to have some comfort and some systems so

that you can make sure that that part of your life

is taken care of without having it take over your life

so that you can put your energy and your time and

the thing that you actually do.

Beautiful. Okay.

You have a way of just lowering everyone's blood pressure.

Good. All right,

so let's start from the beginning.

We've got someone who's just started their business and give gift

his listeners,

if you're already into your business and you don't have a

bookkeeping method,

that's okay.

Now you're going to learn what you need to do.

So don't be hard on yourself.

Just pay attention and get it put in place.

That would be my advice for you,

but let's start with someone,

cause I think it's just a cleaner,

easier way to go.

Someone who is starting their business,

they've gotten to the point where they've made some candles.

Let's stick with that.

And someone's told them they should start selling them.

And so now they're starting to do some financial exchanges.

Yeah. What is your advice here?

So the first thing that I would recommend is you just

need to keep a record.

So just as a background,

when we say bookkeeping,

this can sound really intimidating,

but all this needs to mean is a record of what

money is doing in your business.

So what money comes in,

what money goes out and why you want to keep a

record. And this can be as simple as a Google doc

spreadsheet or an Excel spreadsheet or something.

I would recommend a spreadsheet and something digital over paper records

or like a word document,

but anything is better than nothing.

But what you need to record is just like,

okay, so on this day,

this much money exchange hands between me and this other person

for this reason.

So at the crux of it,

I find it really helpful to people to realize it can

be as simple as that.

Absolutely. There are tools that make this easier.

There are things that you can do to make this easier.

There are templates out there,

but at its core what you're trying to do is just

keep a record of where money comes from and where money

goes and why.

Oh my gosh,

that does sound so easy.

Yeah, like you can totally do that.

Okay, but why do I even care,

Lynn, while you,

Because your highest goal here is to make sure the IRS

isn't paying any attention to you whatsoever.

Oh my gosh.

So true.

You never want the IRS to be paying any attention to

you and the way to do that is just to keep

good, clean records that aren't unusual or anything.

The second thing is this information is going to help you

grow and understand your business.

So understanding how much money am I making?

Do I have clients that I'm making more money from?

Are there products that are more profitable than others?

So profit margin is a little out of the scope of

probably what we're going to talk about here,

but understanding things like how much money am I making?

Where is all my money going?

Is there money leftover at the end of this?

All of those things are going to help you understand and

grow your business,

particularly as yours just getting started.

I think a lot of makers,

I'm fortunate to count a lot of makers among friends of

mine and they're just like,

I'm just sort of making the thing that I like and

we'll see if it sells and I'll make 10 different things

and you might be going,

well, how do I figure out which one's doing better?

So your financial records can help you figure out which one's

selling the best,

which one's making the most money,

that sort of thing.

So it's can also be really helpful for you as a

business owner to just understand where money is flowing in out

of your money.

Because money is like the lifeblood of your business.

It's what allows your business to keep going.

And it's really important to just understand if it's healthy or

not. So at its most basic,

again, we're just trying to record where's money coming from,

where's it going?

And the reason for that is both because we have to

do that legally.

We have to have this information for tax purposes.

But also because it's important for us as business owners to

understand how our business is doing and money is the clearest

way for us to understand,

get like sort of a pulse check.

How are things going?

Are they going well?

Is there anything that I want to be paying attention to?

Okay, perfect.

So at the most basic,

if you were doing nothing else,

you're capturing all the money.

So it's not just when you sell product,

but it's also if you buy something for your office,

well obviously supplies for your product,

but even if you're buying something for your office,

if you're buying services to have someone help you with your

website. So it's everything,

Every single thing,

Every single thing,

money in,

money out who it's going to,

who it's coming from,

and then why.

Yeah, so if you're buying supplies,

want to note that it's supplies and it might be useful

to have,

depending on what you're making,

it might be useful to have a little bit more detail

than that.

So you might say,

let's say you're making candles,

you might have different waxes for different types of candles.

So you might record that so that later down the line

as we get into a little bit more detail,

we can use that to help us track inventory.

So we could say,

well I bought the type of wax that I make pillar

candles out of on this day and it lasted me this

long. So you can sort of get the sense of that.

So you might have a little bit more detail on the

actual materials that you're using to make your products.

One of the things that you'll,

particularly for tax purposes,

you want to have a record of inventory and that includes

like both finished products and in progress products.

So if you've got half made candles or something,

I trying to think Kickstarter not really,

you never going to have finished them,

but candles,

you certainly might,

or like a knitting project,

you might have something on the needles still.

And you also want to have a sense of your raw

materials. So this can be a great way to start pulling

in some of that information as well.

But for things like office supplies,

you can just simply just record office supplies.

You don't need to be like,

well I bought 16 pens and ream of paper.

You can just like that might be useful for you to

have. But from a financial record standpoint,

you really just need to have office supplies or website help

or what have you.

Marketing, it can be fairly generic for most things.

Again, except for the supplies you're actually using to create the

product, you want to have a little bit more detail on.

Got it.

Okay. And as you're talking,

I try to put myself into our listeners shoes to think

of other questions that they might be asking.

And I would think that there might be some people saying,

okay, I got that because I pay on my credit card

all the time.

So all the information is just sitting over on my card,

so I'm fine.

What would you say to that?

So yes and no.

If your business and personal finances are completely separate,

which if you're listening to this and you're cringing a little

bit, that's okay.

That's normal.

But you should.

I mean like I'm just going to lay down that right

now. They should be separate.

Yeah, and that's actually for a couple of reasons,

both from a bookkeeping perspective so that it's a fresh year.

Do yourself the favor of giving yourself completely separate finances from

your business because at the end of the year,

if you haven't got into a place of bookkeeping system,

you do have only those single place to look,

so you've got your maybe your business credit card and your

business checking account that two places to look and you're like,

okay, great.

I've got all this information.

I can download it and I can make sense of it.

I can send this to a tax preparer.

If your personal finances are mixed in there,

that gets significantly,

we'll call it spicier And you never really know for sure

how your business is doing.

If ever that topic comes up.

I always like this is the one thing I'm really stringent

on. Yeah.

You want them to be really separate Also from an attack,

like a legal and tax perspective,

and I'm not a lawyer,

but it is absolutely one of these things that have you

were to get audited for instance,

it's much easier if you have a business credit card that

only only ever has business purchases on and you have say

a lunch on there.

It's a lot easier to say,

yes, obviously this is a business transaction.

Look that I have this calendar,

I have a meeting with a supplier or something like that.

I was traveling.

If there are no personal things on there,

cause if you're like,

well also there's my takeout from the other night,

it's a lot more difficult to then justify to an auditor.

Yes, these are business expenses.

So there's a lot of reasons to keep those things separate.

Plus it's a waste of time.

Then at the end of the year to try and have

to go through and and tally it all out.

Okay, so let's go back.

Let's say this person who's using an Excel spreadsheet,

they're documenting everything we've just described.

Let's complete what that process looks like for a year.

So you're inputting information,

inputting, inputting,

inputting, and it gets to the end of the year.

What do you do with that set of information then?

Yeah, so what you've just created is called a general ledger.

And these financial reports that we talk about that are generated

by financial software like QuickBooks or FreshBooks or wave,

which are all really common tools that people use,

but even if you're using a spreadsheet,

it can be overwhelming to look at the names of these

things and we're like,

Oh, here's this fancy thing.

So this list of transactions is called the general ledger,

which is basically just a list of all the transactions that

happen in your business.

And from there,

when I do my own bookkeeping,

I really just export a general ledger.

And from there I'm creating profit and loss reports,

which is a summary.

It's just saying,

okay, over the course of a given time period,

loss report,

which is just a high level.

Okay. This is the total amount of sales of these different

types of products or services and this is where all of

my money went for the whole time period.

Not every single transaction,

but here's all of my marketing expenses summed up into a

thing and you can do that by if you're using Excel,

you could make a pivot table which are very simple,

easy to use,

things to just summarize data.

That could be your profit and loss report.

If you're using a tool like QuickBooks,

they create that for you automatically.

Yeah. I want to get into the tools like a minute

with someone who doesn't have any tools yet.

I just wanted to finish up that and then we'll talk

about the tools.

Absolutely, and if you're having a tax preparer or something like

that, the only piece of information that you actually really need

is a general ledger.

They can always work with that and create what they need

out of that.

I know my own tax preparer prefers that.

I summarize those things like,

Hey, what's your total expense for marketing?

What was your total expense for contractors?

So profit and loss report is sort of that next step

and literally that sounds fancier than it is.

It's also sometimes called an income statement,

but all that is is a summary of the things on

that general ledger.

So like add up all the marketing and that goes in

a line,

add up all the sales that goes in a line and

then you subtract all of the expenses from all the revenue

in that Kizzy or net income.

And that essentially is the profit you made and the profit

is what you use to pay your taxes and to pay

yourself. And I would even suggest,

I mean you don't have to be a real XL guru

to do this,

but I would suggest that to make it even easier on

yourself when you're recording initially money In or money out where

it was from,

and then have those different columns in Excel as the categories.

Oh, cost of ingredients,

cost of,

well maybe office equipment,

but then have a couple of different lines so that then

you'll have the sums of those columns that are either expenses

or in comm.

Then you're already done.

And then you're just building it up from the start.

Jeezy peezy from there.

Easy peasy.

So that's what you send over to someone who is preparing

your taxes.

Exactly. Got it.

Okay. Wonderful scene.

Bookkeeping doesn't need to be so hard the way Lynn's describing

it. It's really easy and right after a word from our

sponsor, she's going to get into some of the tools to

make it even easier.

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Now Let's get into why you might be interested in investing

in FreshBooks or QuickBooks or one of the software programs that

can do a lot of this for you.

What's the value of doing it that way?

So the value of doing it that way is,

there's certainly a little bit more work upfront,

especially if you're getting started.

Some of those tools have so many features,

which are great for those of us who are a little

bit further along in our business.

But when we're starting out and we'd be like,

I don't need all of that.

This is overwhelming.

I'm getting confused getting this set up,

but the value in using something like that is first of

all they're going to create a lot of those reports for

you so at the end of the year you just have

like a click of a button like make me a profit

and loss report done,

make me whatever it balance sheet.

The other thing,

and this is I would say even more valuable is they

are likely to connect directly to your bank accounts so that

you do not have to type anything when you're going in

here because we think about it and it can seem really

simple like,

Oh at the end of the week or the end of

the month,

I'll just go in and enter all of my receipts,

but what if you forget a receipt or you get busy,

which is I think best laid plans.

We all think but your business starts doing really well and

you're busy.

It can be very easy to lose track of that.

If you were using a tool that is connected to your

bank or your credit card directly with a click of a

button, they're pulling in all of that information and you're just

going, yep,

that's marketing.

That's supplies.

And that's office stuff.

So very,

very simple.

It makes it a lot quicker and easier.

Again, saving you time and energy and attention,

all of those important resources so that you can spend your

time on the thing that you actually do.

So how does that actually work?

So say I have QuickBooks and I charge supplies on my

card, does it automatically go over or does it question you?

Or is there an app?

Like how does that work?

If you're going to use something like,

I really recommend using an online tool.

So if you're gonna use QuickBooks,

I would recommend QuickBooks online and I'll just make a note

on QuickBooks is very,

very full featured,

which can be great and can also be really overwhelming.

And it's okay.

Focus on just a couple of things at once.

And I would also recommend if you're looking into QuickBooks,

to not use QuickBooks self employed,

I find it to be,

I just don't find it to be a very good thing

and it was difficult to then convert that into QuickBooks online.

So of those I would recommend QuickBooks online.

FreshBooks is a great option.

Waive is a pretty good option.

Wave is also free.

So all of these when you start using them are going

to ask you to add your accounts and so that's going

to actually,

because it's you know,

you're talking to accountants,

there's sort of two meanings of the word account.

One is literally a bank account or a credit card.

So you're going to enter in U S you might say

checking account,

he would name it in your checking account.

You would enter your online banking information.

So an authorize it to connect directly to your bank through

online banking.

They're going to pull in those transactions for you.

So that's when you log back into WAV or QuickBooks.

There are new transactions for you to approve.

The other way that they use accounts.

The word accounts in that context is actually like what we

were referring to is categories.

So you're setting up what they call your chart of accounts.

Don't let that overwhelm you.

That's just a list of the ways that your money might

get spent or earned.

It's just the categories.

So you would set up those bank account connections and then

you would come in on a regular basis.

I recommend at least once a week,

I really recommend actually that people log into their bookkeeping system

every day,

but for very,

very short periods of time.

We don't want this to be overwhelming,

but what we're trying to do there is build a habit.

So spend two minutes a day in there,

just like checking transactions,

going and categorizing them.

So the very first time you have a transaction at your

local vendor that supplies your waxes,

for instance,

QuickBooks or wave or whatever you're using isn't going to know

what that is,

but you're going to say,

Oh, this is supplies subcategory wax.

Great. The next time that you have a transaction of that

same vendor,

the tool that you're using,

all of these are really designed well to automatically assume that

it's the same as last time.

So all you have to do is sort of give it

a good thumbs up,

say, yep,

I approve.

That is what it is.

So they learn over time and then make it even easier.

So you can see compared to a spreadsheet where this really

reduces the time and energy that you're spending on this,

making it simpler and allowing you to feel more confident and

get more clarity out of it because you're actually able to

spend the time that you would have spent entering information in

and getting insights out of it instead.

And it's a much more professional way to do it too.

Yes. And as you grow,

you'll be able to really transition.

Again, a lot of these tools have so many features that

you don't need right now,

but you might need an a year and you're not going,

Oh, now I have to pay someone to take all my

information out of this spreadsheet and put it into wave or

something. Right.

You can just start there.

Like I said,

it can be overwhelming,

but just really focus on,

you're just setting up those categories.

You're setting up your bank account feeds and you're just categorizing

those transactions as they come in.

Those are really the only things you need to focus on

when you're getting started.

Oh boy.

And I would say if wave is free,

then there's really no reason not to do it that way.

Yeah, and I kind of feel like if as your continues

to go,

you're just building up additional history that at some point you're

going to want to transition over.

So why not?

If there's no financial issue that barrier's crossed already.

Right. And there's no reason not to use wave,

right? Yeah.

There's no reason not to.

I think their user interface is a little bit clunky,

but again,

it's free.

I find QuickBooks to be overkill for most people and fresh

books is a nice easy to use tool.

It's relatively affordable though.

They, I think they recently increased their prices,

but their focus is primarily on actually invoicing,

which I think for a lot of your clients is probably

not that useful.

Right. It's more for service oriented,

but like coaching and all that.

Yeah, so wave is a great option.

It's free.

It's going to do all the things that we're talking about.

It's one of those things,

like you said,

you might as well get started now keeping track of this.

Even if you're like,

Oh, I only have like five transactions a month,

great. It'll be so easy for you to keep this up

to date then.

Right, and get in the system and understand it And really

build that habit.

That's such a crucial thing that I try and teach people

and with like your initial goal is just to start doing

something. It doesn't need to be right.

You just want to be doing it.

You want to be building a habit of doing it so

that you can always iterate on that,

but you really want to be building up a habit of

doing those things and paying attention to them.

And my guess is that if you're going in fresh,

let's just stick with wave,

but I'm sure QuickBooks does the same thing when you're opening

an account,

it probably walks you through how to set up too,

so you don't have to already know.

You just have to follow whatever the prompts are,

enter the information,

right? Yep,

absolutely. Perfect.

Okay. How about somebody who says,

Hmm, I cloud all my financial information just up there available

to anybody?

That sounds not very secure to me.

I would say that there is always an element of risk

when you're putting information on the internet.

That said,

I do it and I have all of my clients do

it because I think that risk is absolutely worth the reward.

And I also think there's a huge risk.

It may not be a security risk,

but there's a huge risk of keeping information and say on

your local hard drive,

what if your computer breaks down or keeping things on paper.

What if things get lost or they over time they become

illegible Or taken Or taken where you have a an electrical

fire in your space and suddenly your receipts are all gone.

I have a client who is going through an audit right

now and he is like,

may I let you know that receipts over time fade to

the point they're completely unreadable and he's like,

don't put them in a shoe box in your garage like

I did.

Oh boy.

Yeah. I thought I was being smart by keeping all of

my receipts and again,

you know,

security. He was like,

I don't want to put this stuff in the cloud,

but it really came back to bite him.

So I also think that in today's age there is a

lot of focus on the security of things like that because

if for no other reason than huge multinational companies and organizations

are using the cloud for very secure information and they're paying

heavily for the security of those and all of us are

benefiting from that.

Yeah, and if we're going to develop the habit that you

drilling into us,

we're going to be in seen our account every day hopefully,

but for sure once a week.

So you're going to catch something pretty quickly if there's an

issue. Exactly.

You're going to be paying attention to it and if there's

anything that comes up,

you'll notice it more quickly because you're paying attention to it.

Right. I'm in the cloud with everything too and it took

me a little bit to decide and feel comfortable with doing

it, but now that I am,

I'm so glad because I can access it anytime from anywhere.

Okay. You talk a little bit about in your intro about

money mindset,

and I'd love to hear a little bit more about that

and I'll tell you why.

I've talked to a couple people and they're like,

what? How do people have issues with money?

I mean I just want to make more,

but I do know that there is a big struggle with

money for some people.

So I would love for you to talk to that for

a little bit.

I think we all have some weird hangups about money.

Even if we do feel like,

well I just want more of it,

which is still a mindset thing and I actually,

it's funny that I do this work on money mindset now

because for a long time I really resisted doing that because

I saw myself as the practical financial person and I sort

of sold myself the story that there's either practical financial people

or there's like woo sort of folks and I'm squarely in

between those two things.

I definitely have my feet in both of those worlds and

I think we all have some issues with our money mindset

and not even necessarily negative ones,

but there are stories that we're telling ourselves.

There are ways that we think and feel about our money

that impact our behavior with our money.

And whenever I start working with someone,

one of the first questions I ask,

I just say,

so why are we on the phone right now?

And suddenly when I'm hearing about their grandparents' relationship with money

and all of these things,

they're like,

well, my partner is like this and I'm sort of like

this and my buyer's Briggs personality type is like this and

so therefore blah,

blah, blah.

And I was like,

wow, this is like if I asked you how you spent

your weekend,

which in a lot of ways is you have a limited

resource that you have to spend and then you get more

of it just like money.

Nobody is talking about their grandparents' relationship with their weekend or

the way that their parents spent their weekends.

So we all have stuff there and it's absolutely worth just

acknowledging that,

knowing that that's a thing.

As you start to do this work on your money,

whether it's even just paying attention to your bookkeeping,

you'll find yourself starting to say things to yourself and other

people about money.

So I should do this.

I shouldn't do that.

I know I should be doing the bookkeeping.

I know that I should be paying attention to this and

just sort of doubting yourself,

should I be paying quarterly taxes?

Should I do this or I'm not any good at this.

This is just not for me.

That's not my sort of thing that's for other people.

So all of that is mindset.

All of that is what we're talking about.

And I think it's super important to just know that that's

a thing that nobody really knows what they're doing.

We don't do a good job culturally of teaching people about

this would make it weird to talk about and that's okay.

That's just how this works.

There's no after,

there's no like I've finished that work.

It's just about being aware and being able to see it

while it's happening.

So I think particularly for business owners and self-employed people,

there is a lot of passion in our work.

We love what we do,

we do it because we love it.

And we also have some hangups sometimes about making money from

that about something that we love,

particularly if we're in some sort of helping profession or we're

doing something that maybe we're donating some portion of the proceeds

to charity or something.

We feel like we shouldn't be profitable.

That's something that comes up a lot.

Boy, in the maker community,

you're so right.

Land. Yeah.

Particularly with women,

I see a lot of like,

I shouldn't want to make money off of this.

I should just do it for the love of it,

which sure love what you do,

but you should also make money off of it.

I teach people a lot and I was like,

profit is how you pay yourself,

how you invest in your business,

how you grow.

And I know for me,

making more profit and not just money,

but profit like after all of the expenses are done,

making more profit is how I do things like grow my

team and give people good jobs and that's really valuable to

me. Right.

And I think because it's so easy for us,

we don't think that it's a skill or we certainly don't

account for our production time because we're just making,

maybe we charged for materials,

but never the time.

Absolutely. But the other thing that we have to remember,

and I see this a lot,

is not everybody can do those things.

Not everybody is able to knit or has that creative flair

and they so appreciate and it brings joy to their life.

What you're able to produce for them,

you are doing a favor to somebody by being able to

sell a product that you make,

even though it does come easy to you,

it doesn't always for them.

And that just shows you're doing the right thing.

You're in the right business.

Just like we were talking about in the beginning,

Lynn, when you're like,

I can't believe that I'm making money off of something I

love doing every day.

Yeah, well,

absolutely. I think especially when we're pricing our products or services

or whatever it is that we're working on,

our price is part of our brand and it's communicating to

our clients.

And really importantly,

I think we forget about this lot.

It's communicating to us how valuable this thing is.

Oh, good point.

When we don't include the price of our time in something

that you make,

you're telling your clients and yourself that that time is not

valuable. And I think within the business owner community,

there's a lot of identification of our own self worth with

our work because we love it so much and it just

feels like who we are.

I'm just a candle maker,

I just love it so much and I could do it

all day long and it wouldn't even feel like work to

me and it's just what I love doing.

And so of course I'm just going to do it for

free where I'm just going to charge for materials and it's

a way of communicating to everyone in our lives,

including ourselves,

that our time is invaluable,

that this thing that we're doing,

this active creation isn't actually valuable.

And I think we do everyone a disservice when we do

that. And you're not going to be there for the long

haul because that is not sustainable.

Absolutely. You cannot do any of this if you're at a

profit is how you stay in business.

Exactly. And I would contend you really don't even have a

business if you're selling at cost because you're not making anything.

Yeah. I mean even from like an IRS standpoint,

if you don't make a profit in three out of every

five years,

it's a hobby.

Oh, that's the definition.

That's the definition.

Yep. If you're not making a profit three out of every

five years.

Oh, I didn't know that.

Very interesting.

All right,

so you are so fortunate you have a view into lots

of different personality types,

I guess I'll say lots of different types of businesses,

all of that are there a couple of,

I don't really want to call them mistakes because I don't

think people do them intentionally.

They just don't know.

You know?

And then they transition when they are working with you because

they learn how to do things.

Right. But are there cautions that you could share with us

of things that you've seen that you would recommend to us

to watch out for or not do?

Sure. I think the biggest thing that comes up when you

ask me that is just not getting started sooner.

So in terms of just keeping good financial records and letting

our fear and our shame and our overwhelm keep us from

doing anything at all.

I would say that's the biggest thing that I wish I

could really drill into people's heads,

like just get started.

Don't worry about perfection,

just work on building a habit and a system,

something that feels like it fits into your life and it's

doable for you and then you can always improve that later.

But really just get started.

Don't let this be this big scary thing in your life

that you don't pay any attention to.

Just begin and you can always get help because one of

the things that I see time and time again is when

we get started on it,

it doesn't feel as scary to us anymore.

We may not be doing it perfectly,

but we are doing it.

And so we have more confidence to ask questions and to

get clarity where we need it and to figure out what

we need to do to make it better.

So really the biggest thing is just don't let your feelings

keep you from actually doing something about your finances and your

business or your life And what you have already talked about

right here is so achievable.

I mean,

everyone can write when they're done listening to this show,

get started,

pull up an Excel spreadsheet.

Yeah, and you can just get started from today.

Yeah, exactly.

You can always go back and say,

okay, now I need to pull in the first part of

the year.

Get started from today.

What happened today with your money?

What happens tomorrow with your money?

You can go back later again,

really trying to just build a habit and build a system

that works and improve on it later.

Perfect. Are there any other cautions you would give us or

should we leave it at that for now?

I think really that's the big one.

And then some of the things we've already talked about keeping

your business and personal finances combined for too long will give

you so many headaches down the road.

Just split them,

just do whatever it is,

you know if you need to apply for a new credit

card for your businesses.

And I would also just let you know too that until

you get to the point where your business is like an

S Corp or a C Corp,

which is for many people may never happen and for a

lot of other people is years down the line.

You not need to have like an official business bank account

or a business credit card.

It just needs to be a separate.

So this can be as simple as going to the bank

that you already have a bank account with and just opening

another account and starting to do your business transactions from there,

just separated immediately wherever you are right now.

Do whatever steps you need to do in order to make

the next business transaction happen in a separate account from your

personal finances.

Perfect. Okay.

And at what point in business should somebody start considering hiring

out for bookkeeping?

I would say if you have a system that you've started

using and it still just never gets done,

it's too important to knock it down.

So if you find yourself in a position where it's just

never ever getting done for you and you have the cashflow

in order to be able to hire that out,

then I think it's worth doing.

That's it.

I think there's so much value in doing it yourself.

I'm a big believer in doing things myself before I hire

them out so that I can make sure that that person's

doing a good job,

that I know what I need and don't need,

that they're not selling me services that aren't applicable for me

and my business and so that I can look over it

and go,

yeah, I feel comfortable with this.

I'm glad that someone else is executing on this,

but I'm still the person making the strategy and the plan

for this.

I'm still the person who's directing this work.

And I think with your numbers,

it's so valuable to build a see them.

And really get in there and there's something about looking at

them on a regular basis yourself versus looking at a report

at the end of the month that somebody else makes for

you. That is just really,

really value added,

but that's it.

If you really are at a point where you're like,

cut, I've been in business for years and I just keep

not doing this,

then it's too important to not get done.

So if it's really a matter of like it's just literally

not going to get done,

then hire someone.

Alternatively, if you feel very confident and you're like,

I've got a system,

it works.

I'm doing it all the time.

I know my numbers like the back of my hand.

I feel very confident with this.

I just don't have time and that point,

it's also a good time to hire out.

own bookkeeping,

which is silly because this is what I do and it

doesn't take me very long to do it,

but it's one of those things where I'm like,

Oh, needing to track down this and to pull in this

report and do X,

Y, and Z.

And it's not like I'm not going to keep looking at

my numbers,

but I don't necessarily,

at this point it doesn't make sense for my time to

be spending doing the day to day number crunching and data

pulling in and lugging in here and pulling out this piece

of information.

So I would say if you're sort of in one of

those things where it never gets done or it always gets

done, you just don't have time for it anymore.

Those are both quick times to think about hiring somebody out

Or your time is more valuable doing something else,

right. It's going to grow your business if you're not inputting

numbers, but you're out marketing or going to shows or whatever.

Like I love doing my own bookkeeping actually.

Like I'm that sort of nerd.

Well, you go ahead and enjoy that Lynn Or I love

doing my own bookkeeping,

but it doesn't make sense for my business for me to

be spending my time there.

Exactly. This has been so great because I love the fact

that it sounds so doable And I really think it is

so doable for everybody.

It really can be.

If you were to tell one person exactly where to get

started, where would you go?

That's such a great question.

Yeah, they don't want to think about it.

They don't want to know,

should I do an Excel spreadsheet?

Should I go to wave?

Should I hire out?

What would you do?

I would just start using waves.

Then in that case,

honestly, I would just start using wave.

It's free.

It's relatively easy to use and it's going to make things

simpler for you than using a spreadsheet.

All right,

good. I was thinking that was what you were going to

say, but I didn't want to suggest it.

I just wanted to hear you say it.

Their website is wave apps.com

but if you Google wave wave accounting or something,

you'll find it.

Wave apps.com

all right you guys,

I will check it out and I will put it in

the show notes so that you can see it,

but it sounds like Lynn already knows wave apps.com

but I'll just confirm that for you guys over in the

show notes.

But yeah,

so anybody who does not have a bookkeeping system yet is

just starting out to now know where exactly to go.

One place that it,

and guess what it's done.

You have accomplished so much today.

Once you've done that and you're setting your business up properly

as you're moving forward,

so you'll be able to put a big Pat on your

back tonight when you go to bed.

Absolutely. Yeah.

So Lynn,

so much value you've given us,

we would like to return that to you by way of

a virtual gift.

This is a magical box containing unlimited possibilities for your future.

So this is your dream or your goal of almost unreachable

Heights that you would wish to obtain.

Please accept this gift and open it in our presence.

What is inside your box?

Well, first of all,

thank you.

You're welcome.

You know,

isn't it so funny to think about like,

even though I do this all the time,

I ask clients stuff like this,

I'm like,

Oh, you want me to talk about my dreams and hopes

right here in front of other people?

It's the law of attraction.

Know. I know.

I think that the thing that comes up when you asked

me that as I really want to do a Ted talk,

I want to talk about managing your finances,

your day to day finances,

budgeting, all of these things as a form of radical self

care because I just believe so strongly that healing this part

of your life can change so many parts of your life

and just make you feel so much more confident and clear

about everything in your life.

And I seen it change people's lives and I want that

for so many more people than I'm able to reach.

And the platform that I have right now Love it.

And I just,

just by the way of your style and making it so

calm and easy and because when we see numbers,

I just see like dollars and all of that flying in

front of my face.

Right? Like you're just like freeze up for like,

Ooh, I can't,

but you're so calming and you're just is so clear and

so clean.

Plus you've got such a fun personality.

I think you'd be fabulous with a Ted talk.

I think.

That's awesome.

Wonderful idea.

Yeah. Yeah.

Watch for it.

2020 maybe.

All right then.

All right,

we just said it.

So there you go.

And if people want To know more about you with the

wiser miser and your whole business,

where would you direct them to go?

Yeah, so you can find me on Facebook and Instagram at

Lynn Summerlin and I would spell that,

but I'm sure it's faster to just have you put something

in the show notes,

but so you can find me on Facebook and Instagram and

Lynn Zimmerman and you can find,

my website is Lynn summer,

men.com and I've got some great content on there on my

blog. Actually,

I've got some stuff about DIY bookkeeping and like how often

should you be doing what and more information about it.

How would I know if you're ready to hire a bookkeeper

and what questions do you ask them?

And all of those things are on my website.

So I think those would be great compliments for what this

conversation we've already started having to,

Okay. Now my final question to you is so random,

but I cannot leave without asking you this.

Great. Why don't we got your chickens are named after strong

women. Yes.

What is that about?

So it started when I first got chickens,

gosh, it's been three years now,

maybe a little bit longer.

I got chickens and I just want him to name them

ridiculous things.

So we had a chicken named Judy Garland and wrote a

Morgan stern and Dorothy's born ACH and uh,

and we just had these great chickens and then we actually

named one of them true VI,

which is Dolly Parton's character and steel Magnolias.

I'm a huge Dolly Parton fan.

Like it's silly.

I just love Dolly Parton so much and just it became

a thing that as I got more chickens,

I named one of them after my,

the principal of the high school that I graduated from that

I admire so much because I got chickens around the time

of her retirement and I was just thinking about her.

Did you tell her you needed to get afterwards chicken after

you, you should be so honored.

You know,

and I,

it's just like a really nice way for me to just

think about and be continue to be inspired about the people

in my life that really keep me lit up in a

way, even while I'm just like collecting eggs and letting my

chickens wander around in the yard.

I just love that.

That's awesome.

Thank you so much for sharing that and thank you also

for all the information that you've given us here on the

podcast. Yeah,

absolutely. Thanks for having me on.

See, I told you bookkeeping doesn't need to be so hard.

I think we just get it in our mind that if

you're not a math person or algebra was scary to you

in high school,

that it's going to be more of the same.

It's not the case.

It's so much easier,

and Lynn laid it out perfectly for us,

so thrilled that we've got this information now that we can

use so that we can make our business stronger and healthier

for the future.

I'm going to keep these final comments pretty short today because

I really want you to go over and watch my video

about the power of purpose.

Again, you can see it right over at gift biz,

unwrapped.com forward slash.

Planner. There's opt in.

You Don't have to give me your email.

I'm just so happy that I can provide this information to

you. So go over there and check it out right now

and I look forward to being together again next week on