Planning Your Budget for the New Year

By on Jul 11, 2012 in Bookkeeping, Budgeting, General Tips

Are you already thinking about the 2014 budget?

Don’t wait until the New Year, start planning now so that you are ready next week with a plan. Others will wait and spend the entire year thinking about getting their finances together. Not us, we start mapping out the annual spending plan now.

Try a free online template or create your own spreadsheet in Excel. First list your income. If you have many sources, list each one separately. If the income varies, take an average of your earnings from last year (the year divided by 12) to come up with a reasonable monthly total.

Then multiply the monthly total by 12 and this is your annual income. This is on a separate line to be used later in our budget.

2014 Income Annual Budget Project Done Excel Worksheet 5

Next calculate your monthly fixed expenses. This would include anything that is due on a monthly basis from regular bills to recurring expenses that are charged to your credit or debit card. Total this column to come up with your monthly number. Then on the next line, multiply this total by 12 for your annual expenses.

2014 Fixed Expenses Budget Project Done Excel Worksheet 4

Then total up the miscellaneous expenses that happen each year but not necessarily every month. Things like car repair, medical expenses, family vacations, meals & entertainment, emergency fund savings, etc. Take a look at your expenses for the last 2 years to come up with your categories and annual expenses. In this section, we have some control of what is spent. If we don’t spend the money in a category, we can keep it in savings ~ so be watchful of this section and see how much extra you can save each year.

Once the annual numbers have been calculated, divide this by 12 to come up with a general monthly number for easier tracking. Setting this money aside each month will take the stress out of emergencies and not drain your bank account in its urgency.

2014 Annual Expenses Budget Project Done Excel Worksheet 3

The next part of the budget is to calculate any debt that you want or need to pay off like credit cards, loans, etc. We will set this in motion when we have our annual totals in order.

2014 Debt Budget Project Done Excel Worksheet 2

Now we are ready to total up our year and see where we are. Start with your annual income and subtract your annual fixed expenses then subtract your miscellaneous annual expenses. This is your annual savings or loss to pay off the debts/credit cards listed. Divide this number by 12 for your monthly payment amount.

2014 Annual Budget Project Done Excel Worksheet 1

If this number is negative, it is time to take a hard look at your Miscellaneous expenses and see if you can narrow these a little to get closer to a positive number. You might even need to increase your income if reductions aren’t enough. The bottom line is that we need money to pay off any outstanding debts and to have a cushion for the just in case. Just in case car repair costs more than expected. Just in case we have a serious unplanned medical expense above our projection.

The next step is to track the money on a monthly basis. You can do it weekly or monthly but by reviewing your numbers, you are always in control of your money and your money won’t rule your life!

2014 Annual Budget Monthly Tracking Project Done Excel Worksheet 6

(Click the image to see the larger view)

Print a copy of the 2014 projections, keep it with you and go over it often. Because it is with you, fine tuning is happening all the time so less money and time are wasted.

The final step would be to snowball your debt to zero and have more money in your savings. I just read the book Pocket Your Dollars by Carrie Rocha and she and her husband used a similar budgeting plan to get out of debt and they have stayed out of debt!

To snowball your debt, arrange them in balance order listing the lowest balance first. Make your monthly payments on everything but apply extra money to the lowest debt until it is at zero. Then take this money along with any extra money and start applying it to your next debt until it is zero. Repeat until your debt payments are all zero! Now this money can be aggressively put towards your emergency fund or the purchase of a house or retirement investments. The less you owe and the more you save, the more options you have! Life gets really fun at this point.

Dream big and enjoy the future. Let me know if you need any help putting your spending plan in order and stay in touch with your progress. Let’s make 2014 a big savings year!

Subscribe Banner
Don’t forget to subscribe to our blog via email! Simply enter in your email address below and confirm your subscription. You’ll soon receive the latest tips and tricks to finance and organizing directly to your email inbox!


Why Are Taxes So Stressful?

By on Jul 11, 2012 in Bookkeeping, Budgeting, General Tips

I have spent the last month and a half working with old and new clients who are frazzled by tax time this year; which has left very little time for anything else. I am finally seeing the light at the end of the tunnel and feeling a little less exhausted. Nothing has really changed in the tax law that effects them so why the panic? For some, there have been life changes – financial aid paperwork is due for the college bound kids, ect. But I think a lot of it is just being overwhelmed by life which is moving way to fast!

Mounting Bills Paperwork Keith Williamson Flickr Photo Taxes


Workspace File Drawers Dennis Hamilton Orcmid Flickr Photo Taxes Paperwork

To get a grip on tax planning, stay organized!

  • Keep your paper records filed by month (Jan-Dec). This makes filing easier and keeps paper clutter out of your way. Whenever you need the information, you know right where to go. Being organized also eliminates time spent searching the house or office and saves you hours each year. I know we can all use more time!
  • I would also recommend monitoring your financial health each month. Review your budget and make any changes necessary. Creating your budget takes the most time, reviewing your monthly finances takes 5-10 minutes if you take the time to organize the information.
  • I would recommend that you use Quickbooks or Excel to keep your head in the game and then update your information weekly. If you wait longer than that, the information piles up and becomes too overwhelming. If you don’t already use Quickbooks, you could hire someone to teach you the basics in about an hour or two. (You may also want to read my post, How To Easily Track Income and Expenses.)

Don’t let tax time take control of your life ever again!

Keep yourself organized, review your information monthly and you will always know where your finances stand. Your financial health and stress level demand that you take small steps today to add time and energy back into your life.

On a personal note: My goal is to send you a weekly blog about the things I see when I am out and about in the world, meeting with clients, talking with friends, and my own personal and family experiences. The topics I work with on a daily basis are bookkeeping and tax planning, construction management, and organizing lifestyles to a manageable level. Stick with me while I am finishing up my last few weeks of tax planning and I will be back to my old helpful self!

Are you interested in being a guest blogger for Project Done?

For more information and to learn how you can submit a guest post and possibly be one of our regular bloggers, head on over to our Guest Posting Guidelines page.
Subscribe Banner
Don’t forget to subscribe to our blog via email! Simply enter in your email address below and confirm your subscription. You’ll soon receive the latest tips and tricks to finance and organizing directly to your email inbox!

What Information Should You Have on Hand to Prepare Your Tax Return?

By on Jul 11, 2012 in Bookkeeping, Budgeting, General Tips

If you are still gathering the information to prepare your tax return or if you are e-filing yourself, do you know what you need to complete an accurate return?

If you are a W2 employee, you will need the W2 from your employer. You should have this already.

If you are self-employed, you should have received a 1099 from every project that you worked on last year. If you don’t have it already, contact the person who hired you and find out if they are filing these. If so, they can email a copy to you. If not, as long as you report the income that you earn, you can file without it.

You should also have the 1099 Interest forms from your bank, Mortgage Company, and from any investments that paid you interest or dividends.


If you are employed by a company and have this information, you should be ready to file your tax return today.

If you are self-employed, you will also need your P&L (Income or Loss Statement) to complete your itemized return. If you have not kept records but have your receipts, you should be able to calculate your totals by hand.

You will need to report your income. If you kept track with a software program, the P&L will have this number calculated for you. If not, you can add together all the checks you received from your clients. It is best to have a copy of each check attached the bank deposit slip as proof of income.

You will also need all of your related expenses broken down into categories that fit on the tax return such as:

  • Contract labor
  • Project related materials or supplies
  • Insurance expense totals for business insurance, health insurance, liability insurance, etc
  • License/permit fees
  • Office supplies
  • Payroll expenses
  • Postage
  • Professional fees paid to an attorney, bookkeeper, or CPA
  • Tax payments made throught the year if paid quarterly
  • Telephone expenses (a dedicated business line is the best way to track this deduction)

2012 IRS Mileage Reimbursement

Misc expenses such as: 

  • Auto expenses (fuel, licensing, repair/maintenance, tires) Also, track your miles in a daily ledger for proof of travel since the IRS gives you a better deduction for mileage than for oil changes and maintenance.
  • Bank fees
  • Donations
  • Meals that were local are deducted at a separate rate than travel expenses
  • Storage fees
  • Travel Expenses broken down by category (air, car rental, lodging, meals, taxi, etc)

There may be more income or expense categories but this should get you started. Keep these receipts on hand for audit purposes. If you don’t have the actual receipt to back up the deduction, the IRS can decide to disallow the expense and you will have to pay tax on this money.

Flickr Tax Credits

Flickr Tax Credits

Prepare early and keep good records. By following these tips, you should never have a filing or audit problem with the IRS. This doesn’t mean that you won’t be audited but it is peace of mind that if you were, you have proof to back up your numbers.

Subscribe Banner


{Do you have financial advice that you would like to share with our Project Done readers?}

Preparing Your Tax Return Yourself or With a Professional

By on Jul 11, 2012 in Bookkeeping, Budgeting, General Tips

Tax pros prepare most returns but there are many people who e-file their own. Whichever method you use, it is a good idea to review the numbers on the return before you sign it and send it. Professional tax preparers make errors too so be sure to look over the return yourself as well.

How do you know if you should e-file yourself and avoid the expensive professional?

Help Wanted Flickr bgottsab

Flickr bgottsab

  • If you do not itemize deductions because you are a W2 employee, you should be able to easily file your own tax return for free at
  • TurboTax Logo Tax PrepIf you itemize deductions with a Schedule A, you could still file yourself with simple software like Turbo Tax for around $40.
  • If you own stock or sold stock last year, collected dividends or had capital gains, you could still use the software program and e-file yourself. There is a step by step tutorial to walk you through all the questions a hired professional would ask.
  • If you have had a major life change such as retirement, divorce, or an added dependent, you can use the software program or maybe hire a professional so that you don’t miss any of the deductions you are eligible for.
  • If you collect rental income or own a small business, you should consult a professional, especially if this is your first year reporting this income.

Either way, make sure that you have all of your backup information available for easy access. If you use a QuickBooks program or work with a bookkeeper, filing taxes is a breeze because all of your numbers are instantly available and there isn’t a lot of time spent adding the numbers or looking for a missing bank statement.

Flickr PT Money

Flickr PT Money

Good luck! April 15th will be here before you know so if you have all of your tax documents together, filing now would be a great plan! If you do not have your tax documents together, February 28th should be your deadline for organizing this information so that you do not have to rush or file late.

Subscribe Banner


{Do you have financial advice that you would like to share with our Project Done readers?}