Alecia St. Germain 00:00
It's time for monthly Money talks with Zen Jenn this month. We wanted to dig into accounting software. I know it sounds super boring. It's not what I would necessarily want to dive into and spend all my time talking about but here's why we're covering it. It's coming up a lot. It is tax time. It's time for business filing. It is time for us to maybe make some decisions. If you've decided that this is the year you're going to become more financially connected in your business, and the beginning of the year is the ideal time to change, maybe how you're choosing to track your finances in your business. So it is the perfect time for us to have this conversation. Let's dive in.
Alecia St. Germain 00:54
Hey you, leader, entrepreneur, business owner, solopreneur, whatever you call yourself. We know you're a visionary business builder, wealth seeker, looking to combine a passion for doing good with leading consciously. It's time to shift from a traditional focus of pure wealth accumulation to one that integrates well being and fulfillment. You're here for a purpose, and it's time to shine your light. So here we go.
Alecia St. Germain 01:26
Welcome back to the conscious edge podcast. I'm your host, Alecia St Germain, founder of the conscious edge where I help women entrepreneurs expand their capacity for what they can hold, emotionally, energetically, financially, really, so that business becomes enjoyable and fulfilling instead of something that is overwhelming and you end up exhausted and don't want to do it anymore. So welcome Jen. Thank you. Good to be here. I love these talks. They're so fun. Me too. Me too. So if you're new here, we do monthly Money talks with Zen Jen. She is my financial strategist. She handles my books, and she has completely transformed the way I think about financials. In my business, I went from someone who was too fun for spreadsheets to loving the numbers. And I don't do it alone, though. I do it with her support, and I think that's one of the big things we're going to talk about today. So we produce this podcast every single week, and it's about every aspect of being a human, building a business, and how we navigate that. So if you enjoyed today's episode, please make sure you hit subscribe or follow from wherever you're listening, we're so happy that you're here, and for those of you who have been listening for a while, I want to say thank you. Thank you for submitting your questions. Thank you for the support. We love you and appreciate you so very much. Okay, Jen, so this idea for this podcast came because last month, every month, you send me a report of my books, like what you reconciled, how we're doing, inflow, outflow, and I actually take the time to look at it.
Alecia St. Germain 03:20
So I want to first say the reason that I do that is because I used to use a another bookkeeping firm, and I kind of just treated it like, set and forget. It like somebody is doing my books. I don't have to look at it. I don't understand what I'm looking at and what you and I figured out when I transferred over to you is that they were actually making some mistakes, yep. And so you've taught me that it's my responsibility as the business owner to double check. Yes, it is. So why is it important to double check?
Jennifer Baas 04:00
I love that you do.
Jennifer Baas 04:03
I think especially if you're having somebody else do your books as a provider, we get pretty used to understanding and like Googling and trying to figure out what things are. So we're pretty good sleuths, but we're not always right, and so when we're making those transaction categorizations, it can be very easy for us. For us to make an assumption and be wrong, put something in the wrong spot, just make a general error that we haven't caught. And so having the business owner, obviously you as the business owner, when you have an expense come through, you're going to know what that's for. And so when we can get your eyes on those transactions and make sure that we're putting them in the right place where the mistakes aren't being made. It's a really wonderful thing, just in terms of the accuracy of your books. The other benefit too is just you seeing what you are spending can help detect where your money is going. Some people, you know, it's like the credit card. You swipe it, you don't think about it. So it can help with that. It can help with fraud prevention. Because as a provider, I'm going to assume that there's a restaurant charge or something like that, I'm going to assume that that was you. You're the one that's going to be able to know, hey, I wasn't there at that time. So that's a great aspect as well. It's just making sure that the charges that are coming through are actually accurate, and that there's no fraud going on.
Alecia St. Germain 05:23
And the other part of what it does for me is we've caught a couple of things that we needed to recategorize, which was great. It also makes me very thoughtful about where the money's going in. Oh, yeah, you know, there's that subscription or there's that thing to address and I haven't handled it. So that time that I spend reviewing it also becomes the time when I'm mindful about what I'm spending, so that I'm not incurring expenses on subscriptions and things that I'm not using in my business, which leaves money to use and allocate in other ways.
Jennifer Baas 06:03
So absolutely, and that's super common right now, because subscriptions are so popular, right? So much is put on a subscription basis. And the psychology of that is that you do set it, forget it, and it's just running in the background at $20 a month or something. And I think the whole idea it's there is people just forget. And so when you're looking at that every month, you can see that and save the money so you can spend it or pay it to yourself.
Alecia St. Germain 06:30
Yeah, it really requires a different level of thinking with the way that subscriptions are working. So there's that piece. And then the comment that I made to you, specifically, when I was reviewing in January was that it was really nice for me to see all of the energy and effort that I put into January. I saw the results of that. I saw how that compared to last January. So now that we've been on QuickBooks for our second year now I could actually see month comparison, how I'm doing compared to last year, and it was helpful for me to see my efforts are showing. Yeah, it is so easy when you are building a business to become impatient or on the other side, to be disconnected and not really think about how, you know, oh, I have the freedom. I can take a day off, or take some time off, not realize how much time has passed, and then wonder where time has gone, and then a business suffers for it. So I have found being connected to the numbers on a monthly basis with those reports, has made me more connected to what my business needs, and also give myself credit for how I am stewarding the business and stewarding the mission so
Jennifer Baas 08:00
And there's so much power in having a software that can help with that, which is, I think what stood out to me when you made that comment was just, you know, there's other options out there that people can use. And you know, you had used the prior provider, they had their own kind of proprietary software and reporting, but so there's not necessarily a right or a wrong pick when it comes to your accounting system, but there are systems you can choose that give you so much easier information that's really useful when understanding your business. And so for us to like, literally, it was the click of the button when I produced those reports to say, include a prior year comparison. It didn't take any effort. It didn't take any work. It was just a click. And as long as we build that financial record in QuickBooks, we'll be able to look back and say, Oh, what happened in that month, or what happened in that year, or what look back for historical trends and patterns and all of those things, or like you were noticing, wow, look at how this January compares to last January. So there's a lot of power that you can access with because I know in our last financial leadership lab, we got the question, do spreadsheets count? Right? Which is such a common question is, do I have to use system, and if I have to use one, does a spreadsheet count? Yeah, it absolutely counts. Like that's a system. You can definitely choose it. I even will use it in certain situations with certain clients or for certain things. So it's not to say that spreadsheets don't work, but when you're at the point of really trying to understand your business and level up that financial aspect and understanding things, having a software that works with you and that enhances your information in a really easy way is a great tool to have at your fingertips.
Alecia St. Germain 09:48
And I've been all three people, right? So I've used software I've used spreadsheets when I was tax compliant, yeah. Barely like tax compliance, send that to my accountant and but it gave me no information, like it didn't mean anything to me. And then the other option that I upgraded, I moved into a software that was a proprietary software. There's a lot of different ones out there that I see people using. I wouldn't say that I really understood what I was looking at. That came from working with you, the kind of things that we talk about in the financial leadership lab, where we really think about the higher level thinking that goes into looking at your numbers. Yeah, I didn't have you at that time, so I didn't understand what I was looking at. And I hear that a lot from people like, I don't really know what I'm looking at, and so it makes the software that you're using, whatever it is, it makes it seem less valuable, like you're paying a lot of money and you don't know what you're looking at, right? I know you get a lot of pushback from people on spending money. But before I kind of dig into that a little bit, I think the other piece, I caution people so when you are on some kind of proprietary software, you can't take what you're doing if you outgrow it, if it doesn't have the complexities that you need, as your business grows, you find yourself having to move platforms, and if that company goes out of business, which is what happened to me, I ended up having to pay you to rebuild books from raw data. Essentially that we could at least get to the accountant, but we have no analysis or anything that we could pull from those prior years, because the information is not there. I think that's the challenge or the risk, I think in using something other than QuickBooks. I don't know. There's probably other software out there that do accounting.
Jennifer Baas 12:07
There are. I think the thing to look for is truly like an accounting software or platform, and there's a couple. There's QuickBooks is the most popular. There's one called Xero, which I've used before. It's a little less friendly for non accountants. I think it functions a little more like a traditional accounting software, so it's a little less friendly. There's one called FreshBooks. There's one called Zoho. So there are a handful of other ones that are coming out to be competitors with QuickBooks. But I think the important thing is, when you choose one like, don't choose the brand new app that is unproven, you know, try to choose one, like one of those four, that at least has some tenure there, and that we're not worried about going out because, like you experienced with your prior provider when they went out and you had to transition, you didn't get to take that with you, whereas with QuickBooks, like You own that subscription, so you give me permission to be in there and to maintain things, but you could instantly revoke that and give it to somebody else, like you're in complete control of your books and you own the information and things so
Alecia St. Germain 13:14
So that's if you want to change bookkeepers, if you want to move from using a family member who does your books for you to having a professional do it as you grow and it becomes more complex, you can do that when you're in something like QuickBooks that you have the ownership of the subscription. One of the things that I want to address was the investment, the mindset around it's too expensive, because there's two things I get all the time around accounting, which is, one, it's too expensive, and that's for both the software and for paying for bookkeepers,
Jennifer Baas 13:55
Yep, very common complaint.
Alecia St. Germain 13:59
And two, it's too expensive for the value that I get, because I don't utilize it fully. I don't understand it. I don't know what's happening in it, or even if you are the bookkeeper in your business, and it's too complex. So there's two things I want to address. Let's address the monetary piece first, the investment piece. First, give me your perspective on that.
Jennifer Baas 14:25
That is when I have somebody who's not using QuickBooks and is considering doing so, that's typically the biggest pushback that I get, is the cost of it. And there is a cost. I think that that's the real thing. However, for me, when I'm looking at it and making the recommendation for somebody to invest in that is really considering it an investment that comes with a lot of pros that should help offset that investment. So when we look at the cost, for example, the simplest version of QuickBooks is $38 a month, and so for $38 a month, you can have a more easy automation of the information. You get all of the enhanced reporting aspects, typically, even if you're only interested in tax compliance, like I actually have one client, she has me do her books, and she is still completely in the compliance mindset. I transitioned her from spreadsheets to QuickBooks. I don't think she ever looks at it, except for once a year when we get things ready for taxes. But it has simplified her life, because she's not having to maintain all of these spreadsheets. And usually when the tax preparer goes to do that, there's questions, are we missing something? And it's like this whole puzzle to put together. So even strictly from a tax compliance perspective, that $38 a month is typically going to make your tax prep much easier, your tax preparer is probably going to be happy to see that there's something easy and organized to look at, right? So whenever I'm addressing the cost complaint, it's really saying is that $38 a month worth all of these other benefits that we're getting. And yeah, we could save that money. But how much time is it taking you, or how much extra time is it taking your preparer? How much extra time does it take you to try to figure out how was last January compared to this January, when you're pulling up two different spreadsheets and trying to figure that out, and that's maybe a couple hours of your time. It's probably worth the $38 to invest there.
Alecia St. Germain 16:29
And so less than $500 a year for someone with a simplistic business. And I get it like, when you're not making a lot, you want to conserve every penny. However, when doing this admin task is taking you away from what you're actually great at in your business, or where you actually grow your business, there's a huge opportunity cost to that. There's a transition that has to happen from being all expense minded, really, like this idea that everything's an expense, to looking at it from an investment that is going to save you time and money in the long run and give you more opportunity in the long run. That is a big shift that successful entrepreneurs need to make, because at some point that expense mindset is going to limit you in all a lot of different areas. If you're doing it over QuickBooks, you're doing it in other areas too. So that would be one thing. The other thing that I'd mention is, so when I'm working with clients, we often talk about, what should you do yourself? What should you delegate? And what should you outsource? And so delegate means you are proficient at doing it. You could train someone else. You could hire someone and train them to do it, if you had to, so your time could be spent where you most enjoy and are masterful.
Alecia St. Germain 18:04
Outsourcing is when you don't enjoy doing it and you don't know how to do it right? So you need an expert. You need a Jenn Baas, right, to do it for you, because you're not expert. I am someone who was not good at it, was not expert at it, and I was doing it myself, which meant I was doing a terrible job at it, and I paid dearly for it.
Alecia St. Germain 18:29
So I think that those are some things to think about for you in anything that you're doing in business, is, do you enjoy it? Are you good at it? Do you not enjoy it, but you're good at it. Well, that's stealing energy from you if you don't enjoy it. But then it's time to hire a bookkeeper. And if you don't understand it and you're not good at it, you need a higher level, I think, bookkeeper, you need someone who's more experienced, because you want to make sure that they're setting the books up properly. There is a lot of people that you get that have had bookkeepers, absolutely, who are not good bookkeepers. Can you speak to that a little bit like, what happens?
Jennifer Baas 19:21
Unfortunately, there's a lot of times where I'll get books in and there's either those mistakes, right? Like the categorization mistakes we found with your prior provider, things not being caught. Your case was really just transaction allocation, so it didn't cause, like, what we would call a material issue, right? Your net income was still your net income. Things were just in the wrong bucket. So that's something that's not as big of a deal, but there are larger issues. I actually had a client that I worked with, and then they ended up working with somebody else, and they got in a pickle because that provider, I think they just hadn't entered two or three months worth of data and then prepared the tax return off of it, and they got audited and got caught right? And so that was actually, like, a very big error that caused a big tax issue. And so when you have somebody doing your bookkeeping, there is trust that's being placed there, the bookkeeping is correct, because it can have implications if it's not correct. So that is for balances. You want some checks and balances there that goes back to what you were saying at the beginning of you looking at your reports every month. And so if you're looking at your reports, and one of the reports that I send you, it breaks down every single transaction, so you're not just looking at the line items and seeing subtotals, you're actually looking at every transaction, and that's where it goes back to as the business owner taking that responsibility to look, because you may not catch maybe some technical thing, but you might catch missing data, or you might catch some of those big red flags. So between you and the CPA, hopefully there's some sort of checks and balances to catch those things. The other thing I would say, too, is the software puts a little bit of a stop gap in there too, like when you're in the spreadsheet mindset, there's a lot of things that can go wrong in a spreadsheet. The software brings some construct to things, so there's bank feeds, and it brings transactions, and it really facilitates making sure that everything's happening the right way. It makes it a little more clear when it's not. Whereas in a spreadsheet, you can have even just a formula error, or you've forgotten to enter some transactions, and it's very difficult to understand sometimes when there's errors that can make a big difference with things.
Alecia St. Germain 21:39
Yeah, and I'm thinking, kind of going back to what we were talking about, is like, what you're skilled at and what you're not, if you're not skilled using a software of some sort that has training that goes with it, even if you're doing your accounting yourself right, and preparing it to give there's So much training that goes with many of the software that are out there. Yeah, if you're going to be the one that does it, then taking the time to get yourself trained on doing it properly is important. You're choosing that to be your job. I think I'm giving maybe a little bit of like loving hard truth here. But like, you're choosing that to be your job. And if you don't want to do it, hire someone to do it. But if you're like, No, I can't I don't have the money to do it. I don't want to spend the money to do it, then you're choosing the responsibility of taking that off and learning to do it.
Jennifer Baas 22:38
And there's also a lot of like, I'm a provider. I'm more than happy to teach my clients how to do it. I actually just spoke with somebody yesterday, and he wants to be able to do the transaction entry, just so he can stay on top of things, but he wants me to spend a couple hours just training them on how to do it. And so finding a provider who has that like teacher's heart of because some aren't. Some can get a little sticky. That's not their thing, and that's fine. But pushing to find somebody who's willing to spend a couple hours teaching you in our software, day and age, where we're so used to all the apps and things, it's really not so complicated, like I can usually teach somebody how to enter the transactions within 60 minutes. It's very simple when things are set up the right way to maintain,
Alecia St. Germain 23:23
You know, and you've we're so kind to your because now I've learned that you have to still keep receipts and keep everything organized. Like, that's my next bane of my existence. You're like, there's a way we can do it with your phone and the app, and we can just link it right in. So you just take a picture of it, link it to the transaction, and then I will have it, and it'll be out of your hands. So it's a process thing that can make it very easy, very efficient.
Alecia St. Germain 23:54
And so that is one of the things that I am taking on this year. It's interesting. I'll just a side note for you. So everybody in the financial leadership lab is filling out there. We just had one of our co working sessions where we work together. We work in silo, but we work in each other's energy. And so everybody's filling that assessment out that you gave them, and they were so relieved when they got to the end. And you said, if you realize that your financials, the financial health of your business, is struggling a little bit like it's lagging in some of your processes, you don't have to take on everything. You said, Pick three. Pick three things you're going to focus on this year. And I bring that up right now because as people are listening, they're a spreadsheet person, or they're in a software and they're realizing, Oh, maybe I want to change to something that I can take with me wherever I go to whatever provider. It's one of those incremental upgrades my friend Sarah G called them incremental upgrades where it's you don't have to take on all of it.
Jennifer Baas 25:04
Yeah, that's such a good point, because I think we typically get super overwhelmed, right? Like, oh my gosh. How can I tackle all of this? Or here's all the things I'm not doing right. And so just the next right action leads to the next right action. So picking that one or two or three things to focus on for this year, and then those things are going to bring you to the next few things to focus on for the next year. And all of a sudden, you've just taken all of these little steps, and before you know it, you're in a completely different place with things.
Alecia St. Germain 25:34
Yeah. So the one thing for me this year is I'm going to learn to manage my receipts better this year.
Jennifer Baas 25:42
Good one.
Alecia St. Germain 25:43
So that is that that's you're not a little sad one.
Jennifer Baas 25:47
That's probably the biggest complaint everybody has, including myself. Receipts are terrible.
Alecia St. Germain 25:51
They're terrible, they're terrible,
Jennifer Baas 25:54
They're terrible.
Alecia St. Germain 25:56
So I wanted to take today. It was a little bit more strategic, but there's definitely so much mindset around this. And then one of the things that I love that we're doing is the financial leadership lab that we added to the exponential entrepreneur, which is my program. But we're also have spots available for individuals who aren't in the full coaching program, and you're taking people through the year. Part of that is teaching them how to use their QuickBooks as a CEO, like not how to be the bookkeeper, but here's how you pull the reports. So yeah, that piece. But then you're also teaching or sharing, we're having conversations around what to look at financially in your business, month by month, to improve the financial health of your business, to make sure that you have good accounting practices. And you're looking at your money monthly, figuring out where the cash flow is going if it's not where you think it should be, a lot of the CEO level things that everyone should be doing. So I'm so loving having you in that.
Jennifer Baas 27:11
Thank you. I'm a super loving being in it, and I think it's such a great opportunity for people who like maybe that next right action is just being in that and getting some guidance, because it is overwhelming and it's so hard to know what to do on your own. I think it's such a perfect space to be able to get a lot of really good information and training in a really supportive environment where you can get your questions answered and things like that. So yeah,
Alecia St. Germain 27:38
So that's a formal invitation. If you want one of those spots, and you hear this, you can shoot me a DM on Instagram at Alecia, st G, that goes right to me. That's actually probably the best way for me to get you more information. You can ask any questions you have about it. We would love to have you. We are limiting the spots that we have available. So by the time you hear this, it's based on availability. So don't wait if this is something that you want. Is my point.
Alecia St. Germain 28:12
Okay, so anything else that's on your mind around this topic, Jen, that you want to land with people.
Jennifer Baas 28:21
I would say, as a kind of and this is one of the exercises that we did in that health assessment, but really thinking about what's working with your bookkeeping system and what isn't working, just taking a second to write down a list and against when people are hesitant to transition to a system that does come with some cost, sometimes being aware of all the things that feel tedious with that spreadsheet system or whatever you do have going on. If you really evaluate it, you can understand the pieces that aren't working and then trying to solve those pieces, whether that's transitioning to a QuickBooks sort of system or hiring somebody so really, just taking a second to ask yourself, what's really working with what we're doing, what isn't working, and then what's that next step we can take to move the needle in the right direction?
Alecia St. Germain 29:09
And I think what I would add to that, because we coach so much around capacity, and what I see in the financial side of things is a when you don't know what your financials are. You limit your financial capacity because you don't know how to effectively deploy money. You don't know when debt is problematic or when it's used in a powerful way. Sometimes it can feel like you're making an investment in your business that is going to be beneficial, but it's maybe money that you really shouldn't be spending where you're constantly in catch up, and it can really change things when you're making these financial decisions without having the numbers in front of you and understanding the impact that's going to make. So that's one second thing is you. When you are doing all of this yourself on spreadsheets, the amount of energy that is likely leaking from you so your energetic capacity is being spent on something most entrepreneurs don't enjoy and or aren't good at, and so if you're someone who is trying to increase your capacity, to hold more in your business, to have a more fulfilling life, to just really become a better leader, this is real conversation for you to say you are leaking energetic capacity to do that, and it is stealing from you being able to do other things in your life and business that are way, way more impactful. And when I think about what the investment is for that I pay for you your services, so you coach me financially, you do my bookkeeping and I pay for the software, and yet I'm more profitable than I've ever been,
Jennifer Baas 31:28
Right? Which I wish more people understood it can work that way. That's an investment that is well worth it.
Alecia St. Germain 31:36
So all of that to say, Stop doing your own books and stop using spreadsheets and doing it yourself. That's a great way to stay shackled to your business instead of having your business grow for you. So I'll leave you with that loving heart of truth, and we would love to have you inside of the financial leadership lab. So with all of that being said, sending you so much love, Jonathan were here, you would say, be well.
Alecia St. Germain 32:13
Thanks for listening to the conscious edge podcast. Make sure you subscribe and take a moment to be kind and share this episode with someone you care about. Leave a review to help us bring more compassionate leaders, building businesses and creating wealth to the table and For show notes, head over to conscious edge. COMM, forward slash, podcast. This podcast and the linked materials are presented solely for general information, educational and entertainment purposes and should not be taken as personal or medical advice or any kind of mental health treatment. Please consult a medical or mental health professional if you feel you need such services. Please be advised that all investing and entrepreneurial endeavors involve risk and the use of the education and information on this podcast and linked materials is at the user's own risk.
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