Topics covered this week
- Classification
- Control
- Calling
1. Classification
Record revenue gross, not net.
Stripe and Square deposit after taking their cut. Categorize that $970 deposit on a $1,000 invoice straight to income and your revenue is understated by 3% — every transaction, every month. It won't change your tax bill, but on $30k of monthly volume you're reporting roughly $10,800 less revenue a year than you earned.
In QBO, post a monthly journal entry from the processor's statement: debit Merchant Processing Fees, credit Sales Income for the fee total. Both sides move, so your bank balance and reconciliation are untouched. Your top line is finally accurate, and you can see what you pay to get paid.
2. Control
We had our good friend Tyler Durbin on our podcast — How to Make a Few Thousand Dollars — last week.
Tyler has lived in Oregon for the past year or so and recently moved to Denver, where he works remotely for a construction company. In the podcast we asked about how he managed to get a job that allows him the flexibility to live the life he wants.
His answer? Taking action. Taking control of the situation and not being afraid to reach out to people. If you have applied to 1,000 jobs and not heard back from anyone, something in the approach is the problem. There are no handouts. Tyler emphasizes this point of taking control of your life and proactively reaching out to people.
Sammy and I will be traveling through Kansas City next month for a personal matter. Since we'll be there anyway, we've reached out to some tax-preparers in the area to see if we can set up a few meetings. Why not?
3. Calling
I've written about this before, but it bears repeating: pick up the phone and call people.
Growing up, I was a relatively shy kid and sometimes that anxiety still manifests itself today. Before I pick up the phone thoughts of "what if I sound stupid" or "what if I stutter" occasionally creep into my mind.
When these thoughts occur I have to constantly remind myself the person on the other end will likely forget what I said 5 minutes after the call — it does not matter, but the value of "touching base" with people is massive.
I'll call business owners, tax-preparers, and new connections. Oftentimes, I will have nothing to say but the opportunities that come of that 5-10 minute phone call sometimes pay off 10-fold.
Until next week
