I first wrote this article over a decade ago for the Savvy Birth Doula (now Inspired Birth Pro. I’m updating it and expanding it here for a new audience!
For the first five years I was in business, my doula business finances were a mess! I was getting plenty of births, but I had no idea if I was making a profit, how much, and when it came to the end of the year, figuring out my expenses for tax time was just awful! I would put receipts in “safe” places, but I didn’t remember what those places were! And trying to remember what that fading receipt from January of the year before was could be maddening!
And then I stumbled on a product that solved all most of my accounting problems. It was called the “File-it!” calendar, and I have used it every year for the last fifteen years with great success.
This calendar hangs on the wall – for me this is essential to not getting buried in mounds of stuff on my desk – and I use it to record the places I go and the mileage. I do NOT use it for appointments I’ve not attended yet, or for non-business related stuff. I just record trips after the fact. If I forget to record the mileage on the day I go (which is more than half the time…) I use Google Maps to calculate the mileage.
Each month of the year is printed on a file folder sized pocket. I put all the receipts for business related expenses in this pocket. When I hand deposit a check from a client, I write the client’s name on the bank receipt and it goes in the calendar, too. When I get paid by credit card in person or online, I write the client name and amount on the date I got paid. If a non-business related receipt ends up in there, no big deal. Again, it’s on the wall, so I never have to go looking for the place where the receipts go.
At the end of each month, I enter all the miles, deposits and receipts on the computer. I go through my email inbox and log any online receipts. I go through my purse looking for more receipts. (Bonus! Email inbox AND my purse get cleaned out once a month, too!) After I’ve entered in the miles, I figured out the dollar deduction for those miles (using the current IRS formula –for 2019 it is 58 cents per mile for business trips) and reimburse myself for those, too. I personally use an Excel spreadsheet with different tabs for income, expenses and miles driven, but you could easily use Quickbooks, MS Money, or another program for this.
And to motivate myself to actually DO this every month, all monies I get for my doula work go into a separate bank account for my business. At the end of the month, I write myself two checks: One reimbursing myself for expenses paid, and one paying myself any profit I can withdraw at that point. Can’t get the money into the non-business account without doing the accounting!
I write on the back of the month’s folder the amounts of the checks and the total of expenses and miles.
When I am done, I tear off the file folder pocket for that month and it goes into a drawer in my desk. At the end of the year, I bind a year’s worth together with a rubber band and move it to a filing cabinet for more long-term storage. Every couple years, they’re moved to a file box and put in long term storage.
This system has been amazingly helpful for me. Just having it on the wall as opposed to in a drawer or shoebox makes it always easily accessible. I’m not promising myself to write everything down as it happens – because I know myself and I won’t do that! Forcing myself to balance the accounts once a month helps me to keep my finger on how well my business is doing financially and how much money I have to spend on things like conferences, books, etc. And I spend a lot less time trying to figure out what the receipts mean, as I can more easily remember a transaction from February 12 on March 1 than at tax time the next year!
Now that I know better how much I make and where the money is going, I am better able to find ways to do things I love, like attending big conferences, while still making a profit to bring income to my family.
I don’t have any connection at all either calendar company, but I have found this calendar system to be so helpful to me in keeping a simple, doable accounting process for my business. I have found it at Amazon, Barnes and Noble, office supply stores, and a few other random places over the years.