Since quitting my job in 2015, I’ve intentionally chosen not to write about my business too much. It’s not the topic I want to be known for, and there are bloggers who do a much better job of it already. However, my good friend Kara who runs bravely keeps reminding me that being transparent and sharing the details (including the numbers) has the power to help other women who want to start their own businesses. Being transparent is already part of my M.O., and my numbers have never been off limits. So, if there’s a chance that sharing this information could help even one person, I think I’ll publish my numbers once a year.
It probably makes the most sense to show you my overall numbers at the end of each year, so that will be the plan. However, since I’ve never published this before, I’ll start by sharing some of last year’s numbers so we have something to compare this year’s to. Last week, I mentioned that one of my two new financial goals is to cut back on my expenses and run a lean business this year; that goal only exists because I was not happy with how much I spent in 2016. You might thinking running an online business would be cheap, but somehow I managed to spend exactly $14,000 on mine. Here’s a quick breakdown of where that total came from:
- Advertising (domains, email marketing, ads, etc.): $1,987
- PO Box (required for email marketing): $164
- Printing and Postage (for Mindful Budgeting 2017 Planners): $1,696
- Equipment (new computer and external hard-drive): $1,857
- Travel (flights, hotels, cabs, meals): $2,537
- Education: $932
- Contractors: $2,772
- Accounting (FreshBooks and accountant): $777
- Other Online Services (hosting, etc.): $1,278
Some of these numbers won’t change in 2017. I expect my advertising costs to remain the same. I need my PO Box. I would (figuratively) die without FreshBooks. And I love my hosting providers. In fact, if you’re curious which services I use to run my online business, here are the ones I pay for and would happily recommend to anyone:
- BigScoots – for blog hosting
- Libsyn and SoundCloud – for podcast hosting
- Buffer – for social media management (I schedule everything for Rockstar Finance)
- ConvertKit – for email marketing
- FreshBooks – for small business accounting
While these costs won’t change, there are a handful of expenses I want to slash this year. In fact, I’ve drawn up a rough budget to spend only $7,000 on my business in 2017, which means I would have to cut my spending by 50%. Again, as I said last week, I’m not entirely sure this is doable, because I don’t know what the second half of the year is going to look like yet, but here is my plan…
Accounting Target for 2017: $320 (Save $457)
For the 2015 tax year, I hired an accountant to file my taxes for me. I had worked full-time for the first half of the year, then was self-employed for the second half, and I had an even longer list of expenses (and bigger box of receipts) to deal with. Hiring an accountant wasn’t an option – it was essential. I paid mine $475 and she was worth every penny. And I would have continued working with her, if she hadn’t changed the direction of her business and decided to stop filing taxes. Fortunately, I learned so much from her last year that I feel confident filing my own taxes this year (will cost $20). It helps that I kept meticulous records of my income and expenses in FreshBooks (I currently pay $215 USD/year).
Contractors Target for 2017: $1,200 (Save $1,572)
One of the things I do love about having my own business is being able to work with other like-minded business owners – and being able to support their work, by hiring them to help me with various projects. So far, I’ve worked with two amazing graphic designers, both of whom I will use again and again in the future. But last year, I hired them to do some work I wasn’t quite ready to share with the world. The work is done, I love it, and it will be shared in 2017! But I could have put those projects on hold until I was actually ready to release them (and saved me some money in the process). This year, I’m not going to start any design projects until I’m ready for them to go live.
Education Target for 2017: $0 (Save $932)
Last year, I spent $932 on a handful of courses to help me with my business, and I only completed one of them. Similar to how I used to buy too many books, I am now guilty of buying seats in too many courses. My education budget is on a shopping ban. It’s time to complete the ones I’ve already paid for.
Travel Target for 2017: $1,000 (Save $1,538)
This is one target that I’m not entirely sure I’ll be able to stick to, but here’s why I’ve set it to $1,000: I only plan on going to one conference this year (FinCon in Dallas). I could go to WDS, BinderCon, CPFC and more. Honestly, bloggers and writers could probably find at least one conference to go to every month of the year, and expense them all! However, I’ve decided to start looking at the return on investment (ROI) and know that FinCon is the best conference for me. I’ll likely be speaking this year (on behalf of Rockstar Finance) and doing all kinds of fun stuff with the team. So, that’s the one place you’ll be able to find me, friends! (And if you see me, please say hi!)
The only reason I could see this budget changing would be if/when I can convince a small group of writers in the money/minimalism space to go on a retreat. I’m thinking: 8-12 women come to BC, we rent a big house and talk shop for a few days. Interested? Email me and let’s talk (seriously).
Printing + Postage Target for 2017: $1,200 (Save $496)
Finally, last year I spent $1,696 printing planners and shipping them to people at no cost. Some went to family and friends, some went to bloggers, and I always keep some on-hand for special cases. I will never stop doing this, because it’s an easy way for me to give back to the people who support me, but I do want to try to lower my costs a bit this year. Again, I’m not entirely sure this will be doable, especially because I’m looking at some different printing options for the 2018 version of the planner. But this is my initial target, based on the facts I have today.
Altogether, I’m targeting to shave $4,995 off of last year’s spending + I spent close to $2,000 on equipment last year, which I won’t need to repeat this year. If I meet all of my targets, I would only spend around $7,000 on my business in 2017. Again, I can’t promise it’s doable, but it feels good to have some goals to work towards! And if you go back and look at the chart in my last post, you’ll see how quickly business expenses can eat into your income when you’re self-employed. This year, I’d like to keep a little more of my money in my pocket (and invest it in my future).
Before 2015, I didn’t know how much I was spending on my business. Thanks to tracking my expenses for the past two years, I am now acutely aware of how much everything costs, which has helped me answer the question of whether or not I’m happy with where my money has been going. If the answer is yes, I can carry on. But if it’s no, I can set new targets and try to work towards them. This exercise is no different from what any of us should be doing with our personal finances – business owners or not.
Are there any specific numbers you want to change/work towards this year?