Running a side hustle is exciting, but it can also be overwhelming—especially when it comes to managing your finances. As your side hustle grows, having solid bookkeeping habits in place can make a big difference in your long-term success. By starting good habits early, you’ll save time, reduce stress, and avoid surprises when it comes time to file your taxes or grow your business.
In this blog post, I’ll share five essential bookkeeping habits every side hustler should start now. Not only will these habits help you stay organized, but they will also position your side hustle for financial success. And, if you need help along the way, I offer bookkeeping packages designed specifically for side hustlers and tiny businesses, starting at just $50 a month. Let’s dive in!
1. Track Your Income and Expenses Consistently
One of the most basic yet essential habits for any side hustler is tracking income and expenses regularly. By staying on top of your finances, you’ll have a clearer picture of your cash flow, which is crucial for making informed business decisions.
It’s easy to let this slip when you’re juggling multiple tasks, but by consistently categorizing your transactions in QuickBooks Online, you’ll avoid the stress of sorting through receipts and statements at tax time. I offer personalized training to teach you how to categorize your transactions quickly and efficiently, so you can stay on top of your bookkeeping without spending hours on it.
Tip: Set a weekly reminder to review and categorize your transactions. Consistency is key!
2. Separate Business and Personal Finances
Mixing your business and personal finances can quickly lead to confusion, making bookkeeping much harder than it needs to be. By opening a separate bank account and credit card for your side hustle, you’ll simplify your bookkeeping and make it much easier to track your business expenses.
This separation is especially important when it comes to tax time, as it will be clear which expenses are business-related and eligible for deductions.
Tip: Open a separate business account for your side hustle. This will make tracking your finances a lot easier and help you stay organized.
3. Save for Taxes Throughout the Year
Side hustlers often underestimate how much they’ll owe in taxes, especially if they don’t have taxes withheld from their paychecks. To avoid a surprise bill at tax time, it’s a good idea to save a portion of your income for taxes throughout the year.
Setting aside 25-30% of your earnings in a separate savings account can help ensure you’re prepared when it’s time to file. The last thing you want is to be caught off guard by a large tax bill, so saving early will give you peace of mind.
Tip: Open a dedicated tax savings account and set aside a percentage of each payment you receive. This way, you won’t be scrambling for cash when taxes are due.
4. Reconcile Your Accounts Monthly
Reconciling your accounts is a crucial step in keeping your finances accurate and up-to-date. This process involves comparing your bank and credit card statements to your QuickBooks records to ensure everything matches.
By reconciling your accounts monthly, you’ll catch any errors or discrepancies early, making it easier to stay on top of your finances. I offer a bookkeeping package where I review your books, reconcile your accounts, and provide basic financial reports to give you a clear picture of your business’s performance.
Tip: Make reconciliation a monthly habit—set aside time at the end of each month to ensure your books are in order.
5. Understand Your Financial Reports
Basic financial reports are a powerful tool for understanding how your side hustle is doing. Reports like Profit & Loss, Balance Sheet, and Cash Flow provide insights into your business’s performance and help you make informed decisions moving forward.
As part of my bookkeeping package for side hustles, I help you run these reports and explain what they mean, so you can take control of your business finances. Whether you’re trying to assess profitability or track your growth, these reports will give you the data you need to move forward confidently.
Tip: Make it a habit to review your financial reports each month to stay on top of your business’s health.
How I Can Help You Get Started
Starting these bookkeeping habits early will not only help you stay organized, but they’ll also give you the peace of mind that your finances are in good hands. If you’re ready to take your side hustle finances to the next level, I offer a bookkeeping package designed specifically for side hustlers and small businesses, starting at just $50 a month.
With my package, you’ll receive:
- QuickBooks Online setup and training
- Guidance on categorizing transactions
- Monthly account reconciliation
- Basic financial reports
I make financial management simple so you can focus on growing your side hustle. Plus, I offer free consultations to help you get started.
If you’re ready to get your finances in order and save time, contact me today. Let’s work together to create the perfect bookkeeping system for your side hustle!
Financial Management Made Simple. Let me help you build solid bookkeeping habits that will pay off for years to come.
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