This is part 1 of a two part series. Part one is about running your blog like a business with a free income tacker. Part two is what you need to know for filing taxes. Yes, blogging is taxable.
Income, expense and budget. I don't know about you, but when I hear those words I wanna scream and run the other way. That's ironic for a girl who started out in finance and ended up in IT. Those words seem big and scary. They scream business owner which means managing a heaping amount of work and responsibility that comes with turning a profit.
It's not just business owners who manage income and expenses. If you think about your household, you balance your checkbook and monitor how much money's coming in and going out every month. A really good household even has a budget to manage cash flow so that over time savings are built to meet future goals.
No matter where you are, what you do, or why you're doing it, it's important to measure yourself. Measure where you are right now and make goals for where you wanna be. Think about it in terms of fitness. I know many of you can relate to it if I put it in fitness terms. When you peak at your sport or workout and stop seeing progress, what do you do about it? You start measuring it! The progress stops in part because you haven't measured your progression close enough or put goals in place to challenge yourself to get to the next level.
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These concepts hold true for blogging. Bloggers are often fueled by a passion. What if you were passionate about baking and everyday you baked muffins and no one ever came to buy them? Would you be ok putting money, blood, sweat and tears into something over and over and never getting anything back in return?
As a blogger, it's important to measure yourself the same as you would in fitness or with a home budget. Blogging's work and no matter how much you love it, you have to ask yourself if it's worth your time and money. That's not to say you'd stop blogging altogether, but if you saw what you were putting into it vs. what you were getting out maybe you'd blog 4 days a week instead of 7.
Even if you're new to blogging and not making any income yet, I recommend starting the habit now of tracking income. I made a simple excel spreadsheet to track mine, which I'm providing you in the link to below.
[gview file="https://skinnyfitalicious.com/wp-content/uploads/2015/03/Blog-Income-Tracker.xlsx"]
The income tracker allows you to see your cash flow which you can use to make decisions about what to spend your time on. Not to mention it'll be your savior once tax season rolls around. I didn't start tracking my income until this year when I began my monthly blog recaps. It was a huge pain going through months of receipts and adding them up. Next week we'll talk all about taxes. Don't worry I won't get all accountant on you.
More Blogging Resources
12 Lessons From My 1st Year Blogging
What You Need To Know Before Starting A Blog
How To Blog & work 9 to 5
Do you run your blog like a business? What tools or things have you found helpful in making decisions about your blog?
Lots of Health, Food & Love,
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Linking up today with Amanada @ Running with Spoons
Thanks for sharing this. I am working on getting caught up from 2015 right now...why didn't I start this earlier????
Wow, I REALLY need to document EVERYTHING I buy for the blog.... I am always throwing away receipts!! STUPID ME! STUPID! I need to throw them all in a BIN that I will SAVE for next years tax season! I do however keep tabs on my INCOME! - DUH 😉
You do! It saves you money during tax season.
Thanks for sharing. I go back and forth between wanting to make my blog a business or not, as I'm not exactly sure how I would block out the time, but these how to posts are helpful.
Ads are a great way to start out. Once you set them up, you don't do anything. You can cover your domain and hosting costs with them which is nice.
This is exactly what I needed - I had my spread sheet set up but wasn't loving how I had it going so this helped me get it to where I am completely satisfied! My accountant and I will thank you next year lol.
Great, hope it works better than the last one for you!
I haven't made any money off my blog but this is definitely something I need to consider since my viewership keeps increasing. Thanks for the tips!
Of course!
That's awesome -- thanks for sharing:)
Right now, the blog is still a hobby, but I'm hoping to turn it into way more!
I wish I had done a few things when I first started. Setting up ads from the start is one of my biggest regrets.
Just curious, why do you regret that Megan?
Hi Megan! I so agree that you have to keep track of everything in real time, or it will be a major pain when it comes time to report each year. I made a similar Excel tracker, where I write down every product received, expense, etc. But taxes scare me, I look forward to your post on that!! 🙂
Taxes are not as scary as I'd thought they'd be. More to come soon!
Megan, I love this post. I actually work in finance, and keep a budget like this for my own money. I JUST started tracking for my blog, but it's a mess and I haven't updated it for two weeks. Thank you for inspiring me to be more on top of this!!
xx Jill
Latest post: Hips Don’t Lie! 3 Quick Moves to Keep ‘Em Fit for Life!
Glad to hear I was able to help motivate you. Now get after it!
This is something I need to get on top of more. I like your ideas and they're practical and organized. Since I'm not planning on quitting anytime soon, I really need to start thinking business!
If you're planning on doing it for awhile, it will help and there's a lot you can deduct on your taxes just by having a blog.
I like your idea of tracking all your blogging expenses and income separately. Right now I have a more general budget and include a category for blogging stuff, but I think it's time to make things more specific. There isn't a whole lot of money going in or out related to my blog, but as I start receiving payment for some ads and other things it's probably worth getting a bit more organized. Thanks for sharing!
I found it's helpful for the deductions on my taxes. I was amazed how much I could write off. More info to come on that next week.
Thank you for sharing. I'm new to blogging and I'm not sure if it's worth trying to make an income off of it or not. I'm not really sure how to even begin making an income from it. I'm learning as I go. For now, it's a fun place to share my thoughts.
One of my biggest regrets from when I started blogging was not setting up ads. I had several posts go big during my first year. I could have made enough money to pay for my blog design, domain and hosting. You can read more here: https://skinnyfitalicious.com/12-lessons-1st-year-blogging/
Thanks for sharing! Tracking my blog purchases and having an organized way to keep up with sponsored posts has been on my mind lately. This will be so helpful as I begin getting organized.
That's great! Hope the info helps you.