TL;DR
My apologies to my international readers, but this edition’s opening section really only applies to my readers from the USA. Maybe your county has an equivalent program that you should get smarter on. Or maybe you should just jump down to read the rest of the awesome sections.
This week I learned that I’m a super DumDum about Social Security! Are you?
Well, you’re in luck because I’m going to tell you how to be less of a DumDum about it! 🍀
I think every one of you should listen to this Social Security Deep Dive podcast episode put out by ChooseFI (FI stands for Financial Independence).
The host of the podcast admits to the guest expert that he also barely knew anything either, and he is one of the most successful personal finance experts and content creators out there.
This is not just a topic for “old people”. You’ll learn a ton about how Social Security affects your personal financial situation. But you’ll also come away being more equipped to “speak Social Security”. Just to talk about it in a more informed way. And, as accounting professionals, this word does come across our radar as we interact with client payroll data. So this is an important topic for your personal life and your business.
Here are some things that jumped out to me or that I took action on.
I learned that there is a website called SSA.gov where we can all log in and see our entire earnings history. It’s wild! You are also shown how much you can expect to be paid when you start to collect. It is seriously like a little diary of my life. And good news! This former SAHM has met her “40 credits” of work to get her own social security!
After a string of $0s for 5 years, I got a little emotional seeing that I had $422 of Taxed Social Security Earnings in 2017, the year I got my first tiny bookkeeping client. And then to see it increase handsomely through 2023. Who knew I’ve technically been in business for 7 years! So glad for that first awkward engagement with that first client. And also glad that I’ve gotten a lot better at this job!
I learned about some of the uglier sides of this program related to marriage and divorce and time lines. The 10 year mark is really important when it comes to claims to a spouse’s Social Security benefit. And no, it doesn’t matter if your divorce decree says you get their Social Security if you don’t meet the very clear guidelines.
The guest expert discussed how most people don’t know that you can still claim disability insurance for 5 years, even if you don’t work a W-2 job anymore. That might be good info for you, reader, as you assess the risks of taking your side hustle full time. It also might be good info for you to share with any business owners you talk to who are trying to decide whether to take their small side-business full time.
There was a lot of good info for people who have disabled children. At this point, I just filed that away in my brain for possibly future use (because someone in my family could become disabled today, right?) or to be able to share with folks I encounter who might be facing a tough situation with a child.
It made me think about business owners that I talk to who utilize their spouses/boyfriends/girlfriends (mostly wives and girlfriends, let’s be honest) for all sorts of unpaid labor and how those ladies might have a big, fat $0 for those years in their Social Security portal. That feels wrong to me. Since I do a lot of bookkeeping training in my business now, I talk to a lot of women who are “doing the books” for a man. I wonder how I can start to use my position to advise them about how it is important that the government has a record that they have worked and paid into Social Security.
I’m a perky 42 years old. I wish I would have listened to this when I was 32 so I could have possibly helped my parents navigate their decision about when to take Social Security.
Information is power. I’m less of a DumDum about American Social Security and Disability Benefits. Thanks ChooseFI!
Speaking of podcasts, have you checked out the Conquering Systems And Workflows podcast from The Workflow Queen? There are 51 episodes and she doesn’t appear to be slowing down. Her most recent episode about navigating overwhelm and avoiding burnout is particularly timely for this time of year! 👇
Deals Deals Deals
💰 I asked a question in the group about S-corps. That reminded me that Josh Standley of DKK Accounting is our resident S-corp expert. We did a live stream with him a while back. It is a pretty popular video. And best of all, I remembered he gave this group a discount on his full S-corp course and Accountable Plan template. Use SCORPHUSTLE for 20% off. Not an affiliate link, just a discount I wrangled for y’all!
💰 TB4A is offering the BSH community 10% off purchases*. Use code HUSTLE* to grab some funny and sarcastic accounting swag.
Please always send me any news of deals that you hear of that others might benefit from.
Be There or Be Square
📅 Mondays in January: Co-working Hour. Join me each Monday morning to kick-off your week. RSVP - Feb 5 & Feb 12
📅 Feb 6: 10 Best Practices in QBO*. Alicia Katz-Pollock has seen ALL the mistakes folks make in QBO, and this course will make sure you don’t make the same ones. This one-hour course highlights the Top 10 best practices that you’ll want to get right, saving yourself wasted time and money. Sign up HERE.*
📅 Feb 15: Bookkeeping Buds Magic Hour. Bring your questions or accounting topics to discuss with the Bookkeeping Buds group. Or stop by to meet some Bookkeeping Buds members and see what being part of this community is all about. Register for this FREE meeting HERE.
📅 February 21: I asked in the Facebook group if y’all wanted a Q&A with me, and the response was clear. Register here for How Do I Get Started: Bookkeeping Side Hustle Open Q&A with Kate. Reminder, I will not answer questions about client files or technical bookkeeping problems. But I will point you to resources if that is the kind of question you have. This will be kept private to registrants only, so you can feel safe asking your questions. There are NO dumb questions!
Featured Posts
🌶️ Nick B. is considering making his biz an S-Corp and asked for advice. Lots of good information was shared, check it out if this is something you are considering, too.
Help You Hustle
💪 Interested in the NEW Associate Digital Bookkeeping Certification? Learn more about the details HERE in our live stream with the creator of the certification. And if you are ready to go for it - sign up HERE*.
💪 Here is a 15 minute video where Logan Graf shared how much money he made in his 3rd year owning his firm. This is super rare content that most people aren’t willing to talk about. He seems to genuinely keep no secrets. Chime in below if you are willing to share how much YOU make in your firm. Uncomfortable, right!?!?
One other note: In this video, when he says “Accounting Services”, that is a synonym for bookkeeping but you can charge more when you call it that.
💪Y’all, huge shout out to two of my favorite community members Laura Blackburn and Rebecca Kittel for their big debut as a guest on this big live stream put on by FreshBooks. The webinar is called “Implementing Collaborative Accounting for Client and Team Success”. I commend this to you for 2 reasons (and waited until it was uploaded to YouTube so you don’t have to give up an email to watch it 😎).
If you are curious about how bookkeeping pros can work in FreshBooks, this video will explain it. FreshBooks is pouring tons of investment and resources and training into partnering with accounting professionals like you. For a rough analogy, this is their equivalent of the QBO ProAdvisor certification and resouces.
I know both Rebecca and Laura personally and have worked with them on real client files. They have big brains. They are beautiful, well spoken, and successful. But, at the same time, they are also wonderfully normal. Really regular. They are trying to build lifestyle firms where they earn a great living in the accounting industry while still prioritizing their families. They don’t have huge followings on social media. They aren’t working long hours at miserable firms. These are the kinds of people that inspire me. And yet, they were asked to be on a live stream by a big software company. I promise you they would have both said “no way” if you’d asked them a year ago if they would be asked to do this. But I’m not surprised one bit. They are taking action and walking through the doors that are opening on their journeys. This is the kind of thing that happens when you take risks and keep showing up every day and do things a little bit differently than the traditional accounting path.
For Fun
😹 Catherine K. shared a comic that captures how we all have felt about bookkeeping at one point or another.
Jobs
💼 After much difficulty finding a way to highlight the job opportunities people post in the group, we are trying something NEW to get the #jobopp posts in one place. As job opportunities posted in the Facebook group, they will be added to the BSH Job Opp Google sheet. Check it out HERE! Google Sheets to the rescue!
💼 Y’all, we’ve got a new thread about the pay rates for the bookkeeping jobs at Intuit. Hopefully the more folks add to threads like these, the more pay transparency we can get about a very confusing pay scale. In general, I’m a big fan of these jobs as a risk mitigation strategy and a way to learn a whole lot about small business bookkeeping really quickly. I also think the total compensation is actually quite competitive. You decide.
💼 ALERT: when posting jobs in the FB group, use the hashtag #jobopp to make it easier to add it to the Google Sheet.
My Family Circus
New section of this newsletter for 2024. Completely non-bookkeeping related. It will be a short blurb about topics related to how we manage our family/marriage/house/LIFE! My self-imposed goal is to keep it under 200 words.
🎪 February 1 was the start of a new month, and that reminded me to share with y’all how we handle dishes in our house. We assign that chore by the month.
I have 3 able-bodied children, ages 12, 10, and 9. They are big enough to load the dishwasher. We used to allocate responsibility based on days, but that led to shirking the responsibility (“if I leave these in the sink, little brother has to do them tomorrow.”).
Then we tried a weekly rhythm, but weeks can be quite varied from one week to the next (“hooray, grandma is visiting during my week, less dishes for me!”).
But “Dish Month” seems to solve both the problems of shirking and of weekly variations. They get a whole month of dish duty, but then they get 2 whole months off. And boy do these kids pay attention to when the 1st of the month is!
Note, I do have to step in for pots and pans for the younger 2.
Kate Builds In Public
🎢 New Business since last update:
2 new FreshBooks cleanup jobs at $1490 (1 year, finished in 4 hours) and $980 (7 months, not started, but getting the spidey senses I didn’t charge enough)
3 new training clients ($250 each)
3 additional training hours from existing clients ($125 each)
🎢 Getting paid what I am owed
Here is a new situation I’ll walk through, for anyone that does 1-on-1 consults with clients. First, some background:
When a business owner reaches out for FreshBooks training (my favorite work and specialty), I have a 2 hour minimum. Not 2 hours at once, but 2 separate 1-hour meetings. Why the 2 hour minimum?
Let’s face it. I’ve never met a DIYer yet that only has only 1-hour of bookkeeping problems.
I am trying to make more money per customer. My earnings-per-client DOUBLED as soon as I just started to confidently say “O.K., so you need 1-on-1 training on your FreshBooks file. Well, the minimum amount of time you can book is 2 training hours, but after that, you can book single additional hours if you need it”.
Ideally, they will keep coming back for even more sessions. Every time they do, that is a cool $125 per hour. Easy money. No admin. No responsibility afterwards. 👌
But here is where it gets interesting. When they come back for extra time, I have required them to pay me before the training because I always hear the big shots talk about “You always should get paid up front. Having A/R is for dummies and basically a sin. Please come back to me when you are good at running your business” (o.k. slight exaggeration). But my problem is that I always struggle with getting off the phone at 1-hour! And who is the schmuck? This red headed gal working for free!
So this week, I had a repeat training client who really needed me. I had zero concerns that she wouldn’t pay me. So I chose to NOT send the invoice beforehand. In this instance, I didn’t have a back-end meeting, so I let us continue training as long as it was going well and our brains weren’t fried. We went for 2 hours. And, y’all, I sent her the invoice for 2 hours! You might question why this would be cause for celebration and for writing in a newsletter, but allow me to explain.
See, normally the way that it would have worked would have had her pay $125 for the hour before our call. Then we would have gotten on the call and an hour would have passed, but we would still be deep in a problem, and I’d probably eventually wind it down at about 1 hour and 15 minutes. That is typical, and I’m always a bit ashamed of myself when it goes down that way. I’ve gotten better, but I’m still a sucker for going over the allotted time.
But, by golly, right after that 2-hour call, I sent her an invoice for 2 x $125 = $250. Yes, you may clap your hands for me.
I didn’t ask her permission. Didn’t discuss it. I just did it. My hourly rate for small business FreshBooks training is $125. She used 2 hours. There shouldn’t be any emotion behind it. It is just business. But it was a big step for me, as I’m on this journey to get paid what I am worth.
Now, after I come through the emotional high of this fundamental change, the next harder core step is to charge her automatically. See, I use Ignition for my engagements and billing, even for these little training engagements. So I technically have her payment information. I can go take her payment on my own, but I didn’t quite have the guts to do that in this situation. I wanted her to be the one to pay the bill. But hopefully soon, on the repeat clients, I can let us train for as long as they need me (and as long as I’m enjoying it), and just close the call with “OK, I’ll take care of the invoice for this. My billing system will send you a receipt. And, as always, feel free to book more time on my calendar at this link”. Something like that.
Thoughts? Am I headed in the right direction here? Any pitfalls that you see? What is your experience in getting paid for the time you spend interacting 1-on-1 with a client (which I think is different from billing by the hour for bookkeeping work, by the way….I do value price when I am the one doing the bookkeeping)?
🎢 Saying Yes
In my personal life in the last 2 weeks, I’ve gone to “Coffee with the Headmaster” at our new charter school, Library committee meeting for that same school, an extended prayer breakfast for a local ministry that fights human trafficking, and had 2 different children stay home from school sick (sad pic here 🤒). My business lets me say “yes” to these things.
From The Vault
⚡ We bookkeepers survived yet another 1099 season! From the looks of all the confusing posts in all the FaceBook groups, it remained as terrible and confusing as it always is (Venmo, yes/no? What about Zelle? Do debit cards count? NO ONE REALLY KNOWS). I issued a total of 5 for 3 clients and they were very straightforward.
Here is last year’s newsletter about how I feel about 1099s. I think the whole thing makes our industry look like fools and I’m actively trying to earn a living without any hectic “seasons”. I don’t want a tax busy season. I don’t want a 1099 busy season.
But if you decide to keep 1099s on your plate, make sure you charge a lot. Say it at the beginning of the engagement and put it in writing. When you sign someone in July and tell them the price for next years 1099s is $X flat fee and $Y per form (or however you decide to do it), they aren’t going to give it much thought at that moment. But you won’t have to struggle with what/how to charge in January.
Classifieds (Clickable)
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Keep hustling!
Kate
-Chief Hustler-
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Yep, I have known about the SSN website for a long time - unfortunately because I freelanced for decades as a Line Producer and functioned as an IC, I did not qualify for disability when I was diagnosed with MS. Serious bummer, and ultimately is the reason that has led me to this work from home bookkeeping situation. - May I suggest a topic for a podcast or blog? Nothing to do with systems, I am exclusively QBO so not familiar with Freshbooks, but something came up during "1099" season this year that is a huge can of worms. Did you know that you can have an EIN number as a SP? Also, that most people who have SMLLC's are filling out their W9 incorrectly? They are misunderstanding the instructions from the IRS because it says you can use your EIN, but NOT if that EIN is attached to your LLC disregarded entity, in that instance you should be using your SSN. You can only use the EIN if you have one as a Sole Proprietor. It is totally backwards, and crazy, but this is how it is truly supposed to be filled out. Most people are not aware of this and if they have made themselves a SMLLC, they just use their EIN number, when it is actually supposed to be the SSN. This came to my attention from one of the Accountants I work with, who are in the middle of an audit right now where the IRS has latched on to them for "wrong info on 1099's". Apparently, it is up to the company who issues the 1099 to be sure the info is correct and NOT at fault for the person who has provided the incorrect info. It is a mess and seems quite unfair. I had a hell of a time during 1099 season this year because of this. I had to go through all the SMLLC's and contact them and ask them to change their w9. Some were thankful that I pointed out the mistake, talked to their own accountants about it, and made the change for me, but others were VERY resistant to want to change it to their SSN, even though I was proving to them that it was the correct way to do it. Like I said, big can of worms opened. Would love to see bookkeepers educating other bookkeepers about this as I was unaware myself that you could have an EIN as a SP, so that is where the majority of the confusion was with the way they have the instructions laid out. They REALLY should separate the first box on the W9.
This - "It made me think about business owners that I talk to who utilize their spouses/boyfriends/girlfriends (mostly wives and girlfriends, let’s be honest) for all sorts of unpaid labor and how those ladies might have a big, fat $0 for those years in their Social Security portal. That feels wrong to me. Since I do a lot of bookkeeping training in my business now, I talk to a lot of women who are “doing the books” for a man. I wonder how I can start to use my position to advise them about how it is important that the government has a record that they have worked and paid into Social Security." is why our business is paying hubs through Gusto even though we will incur fees. He doesn't need more social security credits, but it's what I would do if I were to have a contractor outside of my family working in our business.