May 2016 Income At-A-Glance
Gross Income for May: $219,248
Total Expenses for May: $66,862
Total Net Profit for May: $152,386
Difference b/t May & April: +$10,549
Why We Publish An Income Report
This monthly income report is created for you, Fire Nation. By documenting the struggles we encounter and the successes we celebrate as entrepreneurs every single month, we’re able to provide you with support – and a single resource – where we share what’s working, what’s not and what’s possible.
There’s a lot of hard work that goes into learning and growing as an entrepreneur, especially when you’re just starting out. The most important part of the equation is that you’re able to pass on what you learn to others through teaching, which is what we aim to do here at EOFire.
CPA On Fire
What’s up Fire Nation, my name is Josh Bauerle. I’m a CPA and the Founder of CPA On Fire, where we specialize in working with entrepreneurs to minimize their tax liability while keeping them in line with the ever-changing tax laws.
I’ve been working with EOFire for a while now, and John and Kate have included me in these monthly income reports with unlimited access to all their accounts so I can verify that what they report here is complete and accurate.
And because they believe in delivering an insane amount of value to you, my job doesn’t stop at the verification level; I’ll also be providing tax and accounting tips to you along the way!
Josh’s May Tax Tip: Your Financial Foundation
Alright Fire Nation, we’ve all heard the phrase a million times; “A house is only as strong as its foundation”.
The reason we hear it so much is because it’s true.
If you can’t get the basics right, then the advanced stuff won’t matter, and so it goes with taxes. If we don’t build a solid foundation, all the tax saving tips in the world won’t matter.
So while I know we all love the advanced, thousands-of-dollars-per-year-in-savings tax tips, these next few months we are going back to the basics.
Because if we can’t get those right, the advanced tips mean nothing.
Separating business and personal finances
If I had to pick the number one mistake I see entrepreneurs make, it would absolutely be mixing their business and personal finances.
This is a problem for 3 major reasons.
1. It makes your bookkeeping significantly more difficult
When you have to sort through all your transactions each year and manually separate what’s business and what’s personal, you’re adding hours of time to a task you probably already hate performing.
Separating your business finances from your personal finances will clean this task up significantly. It will also ensure you’re taking all the deductions you are legally entitled to.
2. It puts you at risk in the event of an audit
While an audit is very unlikely, that doesn’t mean you should prepare for the possibility of one.
The single best way to prepare for the possibility of an audit is to completely separate your business and personal finances.
If you are one of the unlucky few chosen for an IRS audit, failing to separate your finances could result in the loss of all business deductions you would normally be entitled to.
3. You could expose yourself to unwanted legal liability
The whole legal purpose for creating a business entity is to separate yourself from your business in the event a lawsuit or other legal battle is brought upon your business.
But if you are mixing your business and personal funds together, guess what? You probably just lost your legal separation. If you aren’t treating your business separate from yourself, the courts probably won’t either.
“That’s great, Josh, but how do you set up a bank account and credit card for your business if you’re brand new and don’t have much activity or proof of income?”
Setting up accounts for your business
Here are a few tips for setting up accounts for your business if you are in such a situation.
- Apply for an EIN
An EIN is simply a tax ID number for your business and can be obtained for free in minutes directly on the IRS website here.
For most banks, this will be enough to open a business checking account.
- Form an entity, such as an LLC
This will further separate you and the business and allow you to more easily open bank accounts and/or credit cards for the business.
- If all else fails, just open separate accounts under your name
If you can’t open a bank account or credit card due to a lack of credit or income history, simply open new accounts under your own name.
The important part is just having separate accounts to run your business activity, regardless of what name it’s in.
As with anything else in life, if you don’t build a solid foundation, it will eventually all come crashing down.
If you haven’t yet built a strong financial foundation with separate financial accounts for your business, make plans to get it done today.
If you don’t, all the other tax savings tips you read and hear here will be useless!
As always, please feel free to contact me if you’d like to discuss what would be best for YOUR business. I LOVE chatting with Fire Nation!
*Bonus* If you haven’t checked out our FREE course on business entities yet, you can get it here!
What Went Down In May
Bienvenidos a Puerto Rico!
You’ve heard us talk about it several times, but on May 1, our move to Puerto Rico became a reality.
We arrived at midnight on May 1, and lucky for us, EOFire fan Jorge was there waiting for us in Aguidilla. This was huge for a couple of reasons:
1. We had no clue how to get to our Air BnB – sure, we would have figured it out, but to connect with someone right off the bat who knew the area was a huge plus!
2. We had 8 suitcases and our rental car was not equipped to handle that!
Thanks to Jorge and his friend, Alejandro, we made it back to our place safe and sound – with all of our suitcases.
One month post-move, we’re really enjoying Puerto Rico!
Has it been all sunshine and palm trees?
Not even close.
But as with most things in life, relocating, changing your daily environment, and trying to integrate yourself into what is essentially a new world isn’t easy.
Our decision to start our adventure in Quebradillas has peaked the interest of many, especially the locals.
One of the first questions we get is, “Why Quebradillas?”
We’re used to getting questions like that, cause as you know, Fire Nation, we’re not your “typical peeps” ;)
Quebradillas is a very quiet and quaint town on the North West side of the island – opposite of San Juan, which is where North American’s are “expected” to go when they move to PR.
Because we came to PR for an adventure, we figured we wouldn’t really get the full-on experience if we just went straight to the big city.
We knew there was a lot to uncover and explore on the “calmer” side of the island, and so we decided to start here in Quebradillas, even if this wasn’t where we’d eventually end up.
A couple of things we’ve learned about Quebradillas since our move:
- English is not the primary language; in fact, not many people speak it at all (eeks!);
- The USPS and UPS guys are more than happy to deliver packages, but instead of a knock at the door, they lay on the horn and wait for you to come out (we super appreciate the deliveries either way!);
- We’re less than 2 miles away from the now famous Guajataca Tunnel, a railroad tunnel that connected the town of Isabela to Quebradillas back in the first half of the twentieth century. For all you Snapchat lovers of JLD’s daily rants, you’ll noticed the tunnel in almost all of the geo-filters for Quebradillas.
Shown below: the Guajataca Tunnel view from a remote beach we found by stumbling down an unmarked trail by our house!
We’ve also done a lot of exploring, both for purposes of getting to know the island as a whole and to find our permanent home.
We were incredibly lucky to find the Air BnB that we’re staying in now in Quebradillas, which you’ve seen inside and out if you follow John on Snapchat.
But our time here is up on July 15.
Exploring isla de encanto
Thus far we’ve visited a majority of the towns down the West coast, including Isabela, Aguidilla, Aguada, Rincon and Mayaguez. We even hit Guanica on the South West side of the island, but still haven’t made it all the way to Ponce yet.
The West coast is packed with some of the most beautiful beaches…
AND great food!
We’ve also done a good amount of exploration on the North coast, including stops in Arecibo, and of course, San Juan.
Old San Juan is SUCH a treat; we really enjoyed walking the cobble stone streets and poking around the forts and markets you’ll find around just about every corner.
El Yunque? Yep, we’ve hit that, too!
El Yunque is the national rain forest here in Puerto Rico, and holy wow – it’s truly a work of art from Mother Nature.
Our most recent adventures took us to Palmas Del Mar, which is a gated community just south of Humacao on the South East side of the island.
Palmas, along with a community called Dorado, are the two places most locals we’ve met “expected” us to be.
Not only do both have a boatload of amenities within the community that are super attractive, they also both have a large population of expat residents.
After doing some research, we came to the conclusion that Dorado wasn’t for us.
The community is largely centered around golfing and high-end shopping – two things we’re simply not interested in. Not to mention the real estate prices are HIGH…
We did, however, feel that Palmas was worth checking out for several reasons – the biggest one being the community.
After our visit to Palmas, we’re feeling really good about a move to the East side of the island!
We knew someplace as big and busy as San Juan probably wasn’t for us, but Palmas has proven to be a great mix of laid back and action-packed.
Stay tuned, Fire Nation! We’re only one month in, and we can’t wait to continue to share our adventures in Puerto Rico and beyond with you!
Just for laughs, a few of the things we didn’t expect when we moved to PR…
- If you don’t know Spanish, it’s time to learn it
- Lightening will come frighteningly close to your house – and sometimes actually hit it
- The Internet is actually awesome – we’re at 200 up and 50 down when hard-wired in
- There are A LOT of dogs and cats – everywhere – and despite what you might think, they are NOT in your way
- John has coined the pace here to be one of “hurry up slowly”
- It’s never not the right time to crack a Medalla
Vince Reed Event
Hi! JLD here :-) In mid May I spoke at Vince Reed’s event in San Diego. Upon landing, it felt like I was coming home, but I had to remind myself, I was now ‘visiting’ San Diego…weird!
Vince’s event always brings out rockstar speakers like Russell Brunson, Nick Unsworth, Ray Higdon, and many more. It reminded me again of the importance of attending events. The energy, the people, the vibe…it’s all incredible!
Hopefully YOUR next event is not too far away, and if it’s Podcast Movement next month in Chicago, see you there!
Free Goals Course
We’ve been working closely with SegMetrics over the past several months to try and get some things straight.
Data – your numbers – is everything.
Without knowing your numbers, it’s impossible to double down on what’s working, and ditch (or correct course) on what’s not working.
After SegMetrics reviewed this detailed report with us, I had an idea: if our free courses are proving to generate that many new leads – and eventually, sales – we should have a free course for every product and community in our business!
Now, it’s time for a free course for The Freedom Journal.
So working backwards, what is it that people would find valuable leading up to The Freedom Journal?
We know they want to set and accomplish goals, and that they’re interested in a tool that can help hold them accountable on that journey.
So what comes before they start that journey?
Introducing: Free Goals Course
A huge lesson I learned in the creation of this course, is don’t let other people dictate your timeline and schedule.
There were some potential projects in the works that may have effected the content and format of this course, and because of those potential projects, I waited for over 2 months to start creating Free Goals Course.
Looking back, I can’t believe I let someone else’s project dictate my timeline and schedule – not just because I found myself way behind as a result, but because I’ve now kept this information out of the hands of people who could really benefit from it.
Free Goals Course awaits! Grab your free 8-day email and video series on how to set and accomplish your biggest goals today!
Product/Service Income: $157,688
The Freedom Journal: Accomplish your #1 goal in 100 days!
- Amazon: $5,512
- Shopify: $29,361
- Total: $34,873
Podcasters’ Paradise: The #1 Podcasting community in the world!
- Recurring: $12,152
- New members: $14,432
- Total: $26,584
Podcast Sponsorship Income: $86,000
Podcast Websites: $10,000 Your all-in-one podcast website peace of mind
Free Podcast Course: A free 15-day course on Podcasting.
Free Webinar Course: A free 10-day course on Webinars.
The Fire Path Course: $55 A step by step business roadmap.
Affiliate Income: $61,560
*Affiliate links below
Resources for Entrepreneurs: $12,857
- Audible: $715
- Aweber: $161
- BlueHost: $2,250 (Step-by-step guide and 23 WordPress tutorials)
- Click Funnels: $5,768
- Coaching referrals: $1,447 (email me for an introduction to a mentor for overall online business or a Podcast focused mentor!)
- Disclaimer Template: $508 (legal disclaimers for your website)
- Fizzle: $616
- Infusionsoft: $0
- LeadPages: $1,215
- Shopify: $37
- WP Curve: $140
Courses for Entrepreneurs: $43,444
- David Siteman Garland’s Create Awesome Online Courses: $15,612
- Scott Voelker’s The Amazing Seller: $1,358
- Ramit Sethi: $11,092
- Rick Mulready’s FB ADvantage: $1,212
- Bryan Harris’ 10k Subscribers: $188 + 651
- Fire Pole Marketing: $0
- Grant Baldwin’s Booked & Paid to Speak: $62
- Ray Higdon’s 3 Minute Expert: $174
- Josh Turner’s LinkedIn Academy: $13,095
Resources for Podcasters: $1,150
- Libsyn: $927 (promo code Fire)
- Pat Flynn’s Smart Podcast Player: $24
- UDemy Podcasting Course: $27
- Amber Ludwig-Vilhauer (done for you services): $172
Other Resources: $4,109
- Social Media Marketing World: $600
- Amazon Associates: $950
- Other: $2,559
Total Gross Income in May: $219,248
Business Expenses: $64,254
- Advertising: $1,039
- Affiliate Commissions (Paradise): $6,221
- Accounting: $250
- Cost of goods sold: $5,243
- Charitable contributions: $300
- Design & Branding: $1,980
- Training & Education: $83
- Meals & Entertainment: $1,649
- Merchant / bank fees: $1,910
- Amazon fees: $1,749
- Shopify fees: $526
- Stripe fees: $19
- PayPal fees: $670
- Office expenses: $2,936
- Other Business Expenses: $233
- Promotional / events: $78
- Paradise Refunds: $9,661 (13 pay plan, 3 recurring)
- WebinarOnFire Refunds: $0 (invoice total)
- Shipwire: $1,000
- Sponsorships: $20,000
- Show notes: $360
- Total Launch Package Fees: $0
- Travel: $1,115
- Virtual Assistant Fees: $5,581
- Website Fees: $1,651
Recurring, Subscription-based Expenses: $2,608
- Adobe Creative Cloud: $100
- Boomerang: $70
- Brandisty: $24
- Authorize.net: $91.10
- Cell Phone: $144
- Google Storage: $9.99
- Go2MyPC: $12
- HelloSign: $13
- Internet: $159
- eVoice: $9.95
- Infusionsoft CRM: $498
- Insurance: $551
- Libsyn: $309
- Chatroll: $150
- MotionMail: $96 (annual)
- PureChat: $20
- ScheduleOnce: $9
- Skype: $2.99
- Shopify: $29
- TaxJar: $19
- Payroll fee: $77
- Workflowy: $4.99
- MeetEdgar: $49
- Wistia: $25
- Sweet Process: $29
- WPCurve: $29
- Taxes & Licenses: $77
Total Expenses in May: $66,862
Payroll to John and Kate: $18,193
In our May 2014 Income Report, Josh focused on how to pay yourself as an entrepreneur. Check it out!
Total Net Profit for May 2016: $152,386
Biggest Lesson Learned
With our recent move and the setbacks and frustrations that inevitably come with big change, I’ve realized more now than ever just how important mindset is.
How you feel, how you view things, and how you make other people feel are largely affected by what you’re telling yourself in your head and how you choose to show up.
Let’s be real: it’s tough adjusting to new surroundings – period – but add to the mix trying to maintain focus and make progress and you’ve got yourself a ripe challenge.
Here are a few things John and I did that helped a ton in terms of settling in to our new home, all the while being able to maintain focus and still make progress in the biz:
1. We unpacked the first morning we were here
There’s nothing like suitcases and “unfinished” business to get you all distracted and full of excuses.
I’m big on eliminating distractions, and I know for me, if I had suitcases scattered throughout the house, I’d be thinking about unpacking them and putting everything away like every second.
So, we unpacked and put EVERYTHING away the first morning we were here, which removed a major distraction and source for potential excuses.
2. We set up a dedicated work area within 2 days
As we were unpacking, we were both making grocery and Walmart lists independently.
It was a great time to make these lists because we were walking around the house anyway, and as we were putting things away we were able to take inventory of what was missing that we felt we needed.
Both of our lists included an office setup, so the very same day that we unpacked everything, we found the closest Walmart and grocery store and made a trip.
By the next morning – day 2 – we had our desks and chairs put together and set up, which allowed us to remove another potential excuse we could have used to not focus on being productive: a dedicated working space.
3. No matter what it is, we give 100% to the task at hand
When we’re working, we’re all in. When we’re relaxing, we’re all in. When we’re exploring, we’re all in.
Giving 25% here and 50% there isn’t going to cut it – not if you’re looking to focus and make progress.
If you think about it, spending 2 hours working with only 25% focus is like only working for 30 minutes with 100% focus.
So, if I can work for 30 minutes at 100% focus, and save myself 1.5 hours to do other things that are going to help me settle in to our new place, or to go explore a new area, you better believe I’m going to take it.
Think about how you’re spending your time: is it only at a level of 25% focus? 50% focus? Next time you sit down to do work, or to explore, or to relax, really focus on whatever it is you’re intending to do and give it 100%.
4. Remembering all you’re grateful for
There have been a number of times since we moved that I’ve been so frustrated that I wanted to give up. I wanted to throw my hands in the air and say forget it.
No one said this would be easy – creating success and living a fulfilled life. I know this.
So what is getting frustrated and giving up going to do for me? For my ability to create success and feel fulfilled?
Am I still going to get frustrated? Of course – always.
But it’s not so much about the event or the initial reaction you have as it is about how you choose to react to it. So I run into a situation that isn’t ideal, I get frustrated, and then whatever comes next is up to me to decide.
T. Harv Eker says, “nothing has meaning except for the meaning we give it.”
So, I can continue making the situation worse by feeling sorry for myself, or complaining, or simply feeling like the world is against me, OR – I can choose another path.
Over the past several weeks, the path I’ve chosen is reminding myself everything I’m grateful for.
I get frustrated and scared and all of those things, but I’m able to continue on and focus and make progress on the things that are important to me because of how I choose to react to the situations that make me feel that way.
Gratefulness is a very powerful feeling. Use it.
5. Continuous education
I just finished reading Secrets of the Millionaire Mind, a book I’ve literally been reading for about 5 months now. After this past month, I feel like the timing was so purposeful – I was meant to finish that book here, after our move.
There are so many powerful takeaways throughout the book, and I want to share a few here.
If you haven’t read this book yet, I’d highly recommend buying it and starting it today if even one of the sentences or ideas below strikes a chord with you.
If you’re truly here to create success and freedom in your life, then I know one of these will strike a chord.
“Rich people believe ‘I create my life.’ Poor people believe ‘Life happens to me.'” ~ T. Harv Eker
“It time to decide. You can be a victim or your can be rich, but you can’t be both. Listen up! Every time, and I mean every time, you blame, justify, or complain, you are slitting your financial throat.”~ T. Harv Eker
“‘I commit to being rich.’ Try saying that to yourself… What comes up for you? For some, it feels empowering. For others, it feels daunting. …That’s the difference between rich people and poor people. It’s precisely because people won’t truly commit to being rich that they are not rich and most likely never will be.” ~ T. Harv Eker
“…if you want to be rich in the truest sense of the word, it can’t only be about you. It has to include adding value to other people’s lives.” ~ T. Harv Eker
As it relates to poor people thinking negatively about selling: “If you believe that what you have to offer can truly assist people, it’s your duty to let as many people as possible know about it.” ~ T. Harv Eker
“It’s imperative to realize that it is not necessary to try to get rid of fear in order to succeed. Rich and successful people have fear, rich and successful people have doubts, rich and successful people have worries. They just don’t let these feelings stop them. Unsuccessful people have fears, doubts, and worries, then let those feelings stop them.” ~ T. Harv Eker
“I urge you to practice acting in spite of fear, practice acting in spite of inconvenience, practice acting in spite of discomfort, and practice acting even when you’re not in the mood.” ~ T. Harv Eker
Alright Fire Nation, that’s a wrap!
Until next month, keep your FIRE burning!
~ Kate & John
Note: we report our income figures as accurately as possible, but in using reports from a combo of Infusionsoft & Xero to track our product and total income / expenses, they suggest the possibility of a 3 – 5% margin of error.
This post was written by Kate Erickson, Content Creator and Implementer at EOFire. Follow Kate on Social: