Making money is fun, but spending it can be even more exciting, especially when you’re investing thoughtfully and wisely in your business. In today’s episode, Madison Brown joins us to explain how a bookkeeper can help guide you in your investment decisions, but also how she encourages her clients to make decisions when it comes to spending money as a business!
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Madison Dearly is a bookkeeping team serving brand and website designers and female business own
ers in the online space with friendly, hands-on financial tracking and analysis. With a ton of e
xperience in small business accounting, Madison Dearly understands how confidence in your busine
ss’s financial health fuels the growth you deserve. (And it also supports the lifestyle you work
so hard to afford!) In short, these gals are not your dad’s stodgy bookkeeper, okay?
Many entrepreneurs are familiar with the work an accountant can do in your business at tax time, but a bookkeeper is a team member that helps you year round with managing and tracking your business finances. A bookkeeper can help you prepare year-round for tax time so that you’re not struggling and trying to pull everything together last minute.
The data that a bookkeeper tracks throughout the year provides insightful and solid decision making for where you’re spending your money and how you can manage it moving forward.
If you’re a DIYer or boot strapped business owner, it is totally fine to do it yourself, as long as you’re doing it the right way. If you don’t enjoy managing the numbers, and you simply want to do what you love to do, that’s the time to hire a bookkeeper. While Madison believes that a bookkeeper can provide so much value to your business, she also believes that it’s important to understand the data and know how to apply it.
The best time to hire a bookkeeper is when the bookkeeping takes too much time. When you first get started, it may be easy for you to manage, but as you grow and your income and expenses grow, it may become overwhelming for you to manage.
The best time: When you need to buy back your time.
It’s easy to find a bookkeeper at a giant company or hire one through fiver or upwork, but what sets apart a boutique company that serves a niched audience is:
Owning a business takes a lot of money managing that we don’t like to do. Oftentimes, you’ll find that entrepreneurs will simply spend money when they have it without thinking about the actual investment they’re making. A few big ticket investments include:
How do you know when to actually make that investment? Madison has a Past, Present, Future method to help you make those decisions. Let’s take a look at Madison’s Method:
Let’s stick to the present for a moment and look at analyzing cash reserves. Your cash reserves represent the amount of “risk” you’re willing to take. For example, your cash reserves could cover 3 months of expenses, 6 months of expenses, or more. The less you save, the more risk you’re taking. A great resource to understanding cash reserves is Profit First.
Review the Transcript
Hey, hi. Welcome to the Branded by Bernel podcast. I’m your host Bernel. You may know me as the branding and web designer who obsesses over the details so you don’t have to. We all desire to be great at what we do. Although once we get there, no one seems to talk about the messy middle. This motivated me to set the table and invite industry peers over to share stories about living and working in the creative world. So grab the OJ and champagne, pull up a chair, join the creative community and be prepared to build a brand you fall in love with. This is the brand new buy Brunel Podcast. Today on the podcast, I am so excited to introduce you guys to Madison Brown. Madison Brown is the owner of Madison dearly, and Madison nearly is a bookkeeping team serving brand and website designers and female business owners in the online space with friendly hands on financial tracking and analysts. With a ton of experience in small business accounting, Madison nearly understands how confidence in your business’s financial health fuels the growth you deserve. And it also supports the lifestyle you work so hard to afford. In short, these guys are not your dad’s stodgy bookkeeper. Okay, for more information and to make friends, visit Madison daily.com. Thank you so much Madison, for joining me on the podcast today.
Yay. Oh my gosh, so happy to be so excited when I met you at Spark. A couple got a month ago. Ish. And you asked me to do this. I was like I am so and that is gonna be so much fun. So I’ve been looking forward to this since we met a month ago.
Yes, indeed. So for you guys listening at home Spark is show it’s a annual conference for creative entrepreneurs who use the show it website platform. If you’re new here, that is the website platform that I design websites on. If you’re a pro, if you’re a veteran listening to one of these episodes, you know, we love show it and we talk about it all the time. But one of my favorite things about that conference is the connections that I get a chance to make. And I had the pleasure of having breakfast and lunch with Madison. And I was blown away with her insight as far as helping Brandon web designers to stay on top of their finances. This is not something that we talk about once a year at tax time. But it’s something that we need to be aware of the money we’re making, how we can spend it and how we can make more of it on a monthly basis. So I was so excited to have Madison live. Hi guys, I’m so excited for you guys to hear all the things that she offers, you know, we are in the new year. And I feel like this is the time to get a bookkeeper and to start fresh. So with that being said, I know we touched on it a little bit in your intro Madison, but what services do you offer for web designers?
Yes, we do monthly bookkeeping. So it’s done every single month throughout the year, not just from January to April 15. So right now, as you’re listening to this, as it’s going live, you are probably like, Oh, I gotta get my stuff in order for my taxes, gotta get my husband’s w two or my other w 210 99. All the other things that go into your tax return and it’s on the brain. So this is a perfect time to be looking at if it’s time to hire a bookkeeper so that you don’t have to continue doing this for yourself during tax time. And we provide those services on a monthly basis not only to prepare you for tax time, so it’s way easier to just hand over your books to a CPA or have your books ready to file your tax return yourself. But we’re also making really good informed decisions throughout the year based on solid reliable financial data. How did your business actually do than the the month prior or the quarter prior? And how is that going to affect the tasks that you do in your business? Your marketing plan is really going to shape what you’re doing moving forward in your business. So we help put those kinds of historical reports together to help business owners specifically Brandon web designers understand their numbers to make really smart and savvy business decisions moving forward.
Oh my goodness, I love that I am guilty guys. I’m sure as many of you listening to this that I did not hire a bookkeeper until probably like year three and a half of my business and that was something that I really regret. So I want to ask you, Madison, when do you feel like is a good time for somebody to hire a bookkeeper? Do they need to be turning a profit? Do they need to be hitting that six figure year? Like when is a good time for them to start with a bookkeeper?
Yeah, the answer really varies because people vary. So if you’re starting your business and you’re like, I’m kind of a bootstrap person, like I can pull up my bootstraps. I can figure Have this out and kind of do it myself for a good chunk of time. By all means do it yourself if you are okay, like, you know, looking at YouTube videos or learning a new software or you have a lot of fun in spreadsheets, it is perfectly fine to be doing your bookkeeping yourself. As long as you’re doing it accurately, we want to make sure that we’re spending enough time educating ourselves that we’re not putting together faulty reports for our annual tax return. However, there are some people when they start out their business that they’re like, I just want to be creative. I want to make pretty websites, I want to put together typography and color palettes and all of this fun stuff, I don’t want to touch numbers with a 10 foot pole. And that is a wonderful time to hire a bookkeeper to say, I just want this to be done for me. And for me to be able to read the financial reports. I will say however, some people will just outsource to not want to touch it with a 10 foot pole. But you still need to understand what the reports mean for you for your business, you have to know how to apply it to to the rest of your business. But I will say the best time to hire a bookkeeper is when the bookkeeping just takes way too much time for you. So while you’re a freelancer, or you just started your LLC, you might only have a couple of clients and a handful of expenses. And it really doesn’t take you that long to do. But if you have decided to open a template shop or you have digital products, or you just have a lot more on your client roster, it might take you a lot longer than it did a couple of years ago. And that is the perfect time to hire a bookkeeper when you’re like I need to buy back my time now.
Yes. Oh my goodness, I love that when you need to buy back your time. Um, because you will reach a point in your business where you probably have less time than money. And that’s a good time to hire bookkeepers good time to outsource just in general. Yes. So I know we’re throwing around this word bookkeeper a lot. And I hear this word a lot there software’s that do it. There’s automated systems that do it. There’s places like Fiverr and Upwork. And you know, all this other stuff. But what is unique about working with a boutique style company for bookkeeping, because you focus on Brandon web designer. So what what do you feel like, is the value in that? Because I mean, I know what that like, I know what I feel is the value in that. But I would love to hear your take on that. That is it.
Yes, absolutely. I think the biggest piece is education. Because you can work on Fiverr you can hire someone on Upwork you can work with a giant, well known public accounting firm to get your bookkeeping and taxes done. What is really special about working with a boutique such as us a boutique bookkeeping firm, and I hate to use the word firm because it feels stodgy and it feels kind of stuffy. That’s not who we are at all. But what’s different about working with us is that we help educate one. So I will never let any of my clients have any questions about their numbers. They always know what their gross revenue is, what their profit margin is, what their highest expenses are, so they can constantly be keeping eyes on that throughout the years, it still is this expense still serving me. But another piece is just the connection. I am constantly side by side. I’m like the right hand finance girl to every single one of my clients. We offer quarterly bookkeeping meetings that’s included in every single bookkeeping package. So I’m actually sitting down with every single one of my clients every quarter, allowing them to ask questions. We do a lot of like calculations of can I afford to hire somebody? Can I afford to pay myself more? Can I take time off in my business? Because I’m just really burned out right now Madison, can you help me like, see my numbers? Am I able to do that? And those types of connection and the friendship that we make is really essential to the growth of a business financially. And I just love my peeps to like them. You can’t be having like, really good solid friends and someone that you trust with your finances?
Yes. Oh my goodness. I love it. And you guys listening to this, I hope you can like feel Madison’s smile through like your headphones. Because I can see her and I’m like she’s so passionate. So like excited and smiling when she talks about this. And I don’t know about you guys, but numbers don’t make me smile. Oh, no. It is nice to have someone in your corner that numbers make them smile, but also your business success matters to her as like an individual. So I love that. That is awesome. We will talk more about your services in a little bit. But I really do want to get into the topic that I have you here to talk about today because this is so exciting because like let’s let’s face it guys, making money sweat the spending. It’s pretty fun too. So, yep, we’re gonna chat about how to actually know if you can make a big investment in your web design business. Um, I I’m very interested to know, like how to determine that because I have made some big investments. And I’m not sure if I knew that I was ready to make them. I just was kind of like, well, we’re gonna make them and it worked out. That’s not really the way we want to scale our company. So, Madison, I’m gonna let you give us those tips. And I’m gonna be taking some notes. Haha, yes.
Okay, cool. So this is that point in your business where you are ready to spend big because you know that you want something more for yourself, you know that you’re in it for the long game. This is the longevity thing. This just isn’t just a hobby that your mom’s like, Oh, she designs on the side, like, No, we’re in this and we’re ready to spend to put our money where our mouth is. But it can feel really scary, kind of like you’re on not solid ground where you’re like, can I afford this? Can I not? And you don’t just want to pull up your bank account and say like, Okay, well, there’s money there, there really is a good way, a method that I call the past present future method of knowing how you can actually afford a big investment in your business. And when I say big investment, I’m talking about hiring a team member, joining a mastermind that is multiple 1000 A month or even just 1000 a month is an expensive mastermind, or even taking time off in your business to you can kind of think of that as an investment. Like I’m going to save this much amount per month, so I can take time off of my business. For the purposes of this example that I’m going to give I was going to join a mastermind, gosh, a couple of weeks ago, I was looking at a very expensive one. So we’ll We’ll think about it like that. So the past part of this method is of course, doing your bookkeeping. And as a bookkeeper, did you expect anything less out of me to say that is the first thing for this method. So passes, you’re looking at historically what has happened in your business? And we’re looking at the bottom line. So when you have total revenue at the top, I’m using my hands. I know you can’t see my hands. But we have total revenue at the top, what have all your clients paid your customers pay? Do you have expenses right below what money has gone out the door to keep your business running? And then you have that profit right there at the bottom? That’s the most important number that you need to know in your business on a monthly basis is that profit number? So when you’re looking at your historical bookkeeping reports, and you’re looking at that profit, the question here for pest is, could you have afforded that expense if it had happened in the past three to six months. So for me, the mastermind that I was looking at was about $1,500 a month, which was, to me just felt really large, really overwhelming. And when I was looking at my reports, I pulled up my profit number for the past, I think I did it for the past 12 months, I just pulled up a big 12 Month p&l report Profit and Loss report. And my profit actually was higher than that amount, and I still had been able to pay myself the amount that I needed to bring home to support my family. So I actually Okay, sounds like check that is a good, nice makes me feel a little bit more confident in this investment expense. Same thing goes for you once you pull up that Profit and Loss report and you’re looking at your profit could you have afforded to pay for this expense, if that happened in the past? And that is just a nice good haul, like a breath out like okay, that makes me feel more calm about this big investment. The next step is the present. So when I say present, it really is pulling up your bank account, what is in your cash reserves right now? Could you afford to pay the entire thing in full to save money because we know that a lot of these expenses, if you pay something in full, you actually save money, if you pay it in full, instead of making payments over time, you’re also looking at the balance without this expense. So once you pay for this expense, are you going to be at $0? Because we all know, you don’t have to be a financial expert to know that completely clearing out your bank account is not a financially savvy business decision. So we’re really analyzing where you’re at Cash Wise for that present. And the question here the prompting question is what is in your cash reserves? And then moving forward into the future step is really sounds exactly what it is. What’s happening in the future, the next three months of your business? Are you expecting more clients? Do you have something launching where you’ve got a really solid email list and they’re all hot and ready to buy? Are you going to see an increase in revenue? And could you maybe decrease some expenses in the future that can allow you to properly and confidently pay for this new investment expense? So for me in my the mastermind that I was considering joining, I knew that I’m actually increasing my prices in January. I have a couple of leads that are actually in my inbox right now. So they’re ready to sell Fine. So I knew that my revenue was going to be going up and I could confidently make that decision. So again, when it comes to future, the the prompting question is, what are your projections over the next three months, six months and 12 months? And I call them back of napkin calculations, like you really just need to throw down, like, what are your expenses that you’re expecting to, to pay? And who are the clients that you’re expecting to pay you. So really just get like a good picture does not have to be fancy, doesn’t have to be a spreadsheet doesn’t have to be this whole like budgeting thing. It just has to be a good solid awareness of what’s going to happen in the future of your business. So past, look at what’s happened historically, present what’s currently in your cash, reserves and future what’s happening in the future. What are your projections? We’ll girl, I’m all hot and bothered.
Oh, my goodness, that was so good. Like, I was like, Oh, my goodness, past present, future, write it down. PPF love it. Oh, no, that is really, really good. And I think that a lot of times as business, I’m gonna speak for me, I can’t speak for every web designer out there. But a lot of times present, I think fuels how we feel we can spend, um, you look at your bank account, and it’s like, wow, all right, I have more money in here than I’ve had before. People are booking me there’s leads in my inbox. Yes, that email list is hot and ready. I think that sometimes makes us feel like we can spend more money, then we actually can. Um, so what I really loved was the past feature in your method, because if you ask yourself, if you could do this, if you could have done this three to six months ago? And the answer is absolutely not, well, then maybe you should wait a little bit longer to see if your income is actually studying out at this new amount, or if this was kind of a fluke. And so I love that. Definitely love the past definitely love the future. And you made a or you mentioned the term cash reserves. And I feel like a lot of people don’t know how to properly analyze their cash reserves, because they just analyze their cash. Yep. So when you speak of cash reserves, what is your recommendation on how to find that number?
Yeah, you know, it’s really funny. So many people have been asking me this question a lot lately. So maybe I need to like hop on Instagram Live and just chat about it. It really again, kind of goes back to it varies by person, it really is the amount of I guess risk that you’re willing to take, quote, unquote, risk. So some people are like, I need stability, I need like six months worth of expenses sitting in my bank account. And then I can spend some people like, I’m cool with 123 months of expenses sitting in my bank account, and then I can feel, you know, good enough to spend big money in my business. So it really is somewhere between three to six months, I would say that should be saved in your business bank account. I love profit. First, I’m always going to talk about profit first. That is a cash management system. To kind of break up your this is a good way to put it. Let’s say in your personal household, you had five different bank accounts. One was for food. One was for rent. One was for clothes, one was for gas, or whatever expenses you have in your personal life. And you always know what you can spend what you have in that specific bank account for clothes. So if you have $500 in there for clothes, you know, you’re good, because it’s slated, it’s there for you to use for clothes, profit versus the exact same thing for your business. So you have your operating expense account, your tax savings account, your profit account, because we’re actually planning for profit, and your business savings account. And then you also have an income account where all the money goes into and then you kind of disperse it between the other accounts. But that is an awesome way if you’ve never heard of profit. First, it’s a book, you can look it up on Amazon or even just Google profit first. That is an awesome way to keep really good track of your cash reserves and how much that you have saved in your business to keep it running for the long term.
Oh my goodness, yes. The amount of value that I feel like was in that last two minutes, guys. So rewind, play it again, write it down, pull up the transcript in the show notes. Because that yeah, that was that was very, very impactful. Like my mind is very blown. And I I would say personally that I think I run a pretty sustainable web design business. I have a staff of three, um, I have, you know, I run a payroll every week I make I make you know, pretty big investments in my business. I have a podcast studio, things like that. But you know what, I don’t have five bank accounts. I Ah, this really kind of has the wheels turning of like, oh, yeah, I guess we can’t pull everything out of one or two, you know, I think we the business savings. And then the income account I feel like are the two that most people have, like, um, but those other ones have my wheels turning guys. So when Madison does her live on Instagram, because I believe in accountability, when she does her live on Instagram, I will be there, I will be sitting there, I will be taking notes. Because this is really good to have set up early on, I want to repeat that because I do feel like a lot of you guys listening at home are newer web designers, I have found that a lot of you guys are in your first three years of starting your business. And it’s like, we’re okay, I’m making money. But where do I spend it? And where do I put it? And how do I organize it. And so I really do encourage you to get this book Profit First is going to be in the show notes. But also to check out Madison’s blog, check out her Instagram, check it out other places that she’s had podcast recordings, because this is the financial advice that you have to, you know, get on the waitlist and wait two months, and hope you get in to speak to the person at Chase Bank, who works with business owners of all sizes, and has never met a web designer in real life. And you’re sitting in their office, and they’re telling you things like this, but it is not going to be so crafted for our industry, it’s going to be very broad, they’re gonna tell you the exact same thing that they told the lady who got the five Chick fil A franchises and you’re sitting there like but I just have, like $5,000. I’m trying to figure out where to put it. So I really do want you guys to make the use of these resources. With that being said, Madison, what does the process look like to work with you?
Yes, I’m actually getting emotional. I did not expect to get emotional because I really do feel like I like this is my purpose. I have so much experience, I worked at a public accounting firm, I’ve worked for a nonprofit, I worked for another nonprofit, I have done so much in my career that has led me to this point to work for you to work for brand and web designers who I get who I love, who are my friends who are building families who are becoming the breadwinner in their household. And I feel like that’s my purpose. Not to be the big Chase bank who serves everyone. I am here for Brandon web designers. And I love it. That’s just I’m sitting in my office. So your question was how how? What does it look like to work with me. So on a monthly basis, me and my team are in your accounting software we are going through, we’re categorizing all the transactions, we call it a click party because we’re just click, click, click, click click click through the whole thing. We reconcile so that we know that it’s really good reliable data. There’s not any duplicate transactions or missing transactions, we review it heavily. So if Whitney my right hand gal is the one that’s doing all the bookkeeping, I’m reviewing her work, or vice versa. So we always have to eyes, because financial data is really important for us to have it right. And then we send you your reports by the 15th of every single month. So today as the day that we’re recording, this is December 1, we are like down, we’re doing we’re heads down, we’re working right now. And by the 15th of this month, all of our clients can expect to see their financial reports in their inbox with a nice little snapshot that shows total revenue, total expenses, highest expenses, because we really do want to keep our eyes on those, make sure they’re still serving us. And then quarterly meetings with me. Every quarter, we’re sitting down after a quarter has closed, we’re looking at those financials, making sure that we understand and we can apply them to your business. It is a fun time over here, y’all. We are a bunch of nerds and we love it.
It sounds like a fun time. Okay, so I do want to take a step back, when someone fills out the contact form on your website, they get that in this initial consultation with you before they choose their package or choose which way to go. Do you guys talk about their financial goals? Is that something that you put at the onset, so that you’re kind of working toward it? Or like, how does that work? Yeah, I
mean, it’s more at the very beginning. We’re really just onboarding, we’re setting up your accounting software. I’m understanding how your brain works, and how we can structure your financial reports so that you understand them. They’re not filled with a bunch of accounting jargon. So it really is more foundational, the goals really do come out in those quarterly meetings. So when we’re looking at numbers, and we’re saying, Okay, this is what happened in the past three months. Naturally, people will say, Well, I wish x had happened. I wish I had hit this goal. And we’ll kind of structure those goals moving forward. So then the more quarterly meetings we have, the more we can look back on our notes from last time and say, Hey, this was your goal. Did you hit it? Did you not Hit it structurally what’s going on operationally what’s going on in your business? And how can we tweak the business to get you to reach those goals? So when we’re just getting to know each other with the onboarding, those goals don’t really come out in conversation, but they absolutely do when we’re meeting on a quarterly basis.
I love that. I love that. Okay, so my last question to you and I it’s a question that I hear a lot a lot of people ask me a lot of people ask ticked off is bookkeeping a tax write off?
Oh, yeah. Oh, heck yes. Are you kidding? Paying for me is an absolute tax write off. So it’s not like a tit for tat like dollar for dollar tax write off, but it definitely reduces your taxable income, so that you don’t have to pay as much and then your taxable income is the percentage tax bracket that you’re in. So it gets kind of in the weeds. But of course, you should be swiping your business credit card when you work with me because that’s for sure. A business write off. Yes,
yes. I love that. Because the write offs are everybody’s favorite word. And yes, that is a whole different conversation a whole different you know, ballgame over there with write offs. But you heard it here. You heard it from a bookkeeper. This is an actual business expense, a business expense. This is going to provide clarity, communication, this community feeling and ultimately sustainability in your business. So yes, I don’t know about you, but we need to get those books in order guys. So Madison, I am so thankful that you came to talk to my audience today. It’s a chat with me because this was a really good phone call. Like I’m very I feel very refreshed over here. How can people find you Where can they find you and connect?
Yes, yes, I am. Madison dearly everywhere. So at Madison dearly on Instagram, Madison daily.com I’m kind of dabbling in tick tock so if you want to find you know, you want to watch me dabble Madison Dooley on tick tock as well.
Awesome Madison. Alright guys, we’ll go like following cheer. Have a go. Wow, that went by really fast. As always, thank you so much for showing up in my little corner of the internet. I would love to hear your thoughts on the show. So please, please subscribe, leave a review and share what you learned with friends. Some of the best things in life are freebies. So don’t forget to head over to brandedbybernel.com to check out our free branding goodies. This show notes and more educational resources.
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