Propeller Bookkeeping, LLC

Home
United States
Philadelphia, PA
Propeller Bookkeeping, LLC

Call Directions Website Contact the business

Virtual bookkeeping services for financial advisors and the skilled trades industries

08/20/2024

It’s important to lay the groundwork. Starting something new can be intimidating. But if you are consistent and stick to it, you can make something great.

A bonsai tree is a good metaphor for this. It can take up to 4-5 years for the tree's trunk to become just 1 inch (2.5 cm) in diameter.

It can take anywhere from 5 to 10 years to create a bonsai masterpiece. Growing a bonsai tree is an ongoing process. It needs to be pruned and cared for regularly in order to reach its full potential.

08/13/2024

Creating a simple budget is easy and takes about 30 minutes. You can make it in Excel, Numbers, or Google Sheets or you can go old-school and write it out with pen and paper.

Here’s how to make a budget in 4 simple steps:

Step 1.) List out all of your sources of income. This may include:

- Wages from your job
- Earnings from self-employment
- Earnings from spouse’s work
- Income you receive from properties you rent out
- One-time sources of income like an inheritance
- RMDs from IRAs or employer plans

Step 2.) List out all of your expenses and how often they occur. Be consistent with your time frame. Calculate everything on a monthly or yearly basis.

- Taxes (social security, Medicare, self-employment, federal income, state income, local taxes, property, real estate)
- 401k or other retirement savings
- Deposits into taxable investment accounts
- Savings for kids’ college
- Insurance (home, auto, health, dental, vision, disability, life, umbrella)
- Food (dining out, groceries)
- Gas
- Utilities (phone, internet, cable, water, electricity)
- Clothing
- Rent/mortgage payment/HOA fees
- Loan payments (car, school, medical)
- Credit card payments
- Car maintenance
- Home maintenance
- Estimate of one-time expenses
- Education (school, professional development)
- Kids (sports, private school, extra-curriculars, tutors)
- Miscellaneous (haircut, ATM withdrawals, etc.)

Step 3.) Take your total income (which is likely to be annual gross salary) and subtract your total annual expenses. If this is positive, good job! You are living within your means. If this is negative or a small number (less than $500), you have some room for improvement. Look for additional sources of income or see where you may be able to spend less.

Step 4.) Save your spreadsheet and revisit at least annually for updates.

07/25/2024

The balance sheet is a financial statement that shows the financial health of your company as of a point in time. It is represented by the accounting equation, ASSETS = LIABILITIES + OWNER’S EQUITY.

It is called the balance sheet because it balances: assets (what you own) on one side of the statement are worth as much as the liabilities (what you owe) and owner’s equity (what you put into the company and leftover income from prior years) on the other side of the statement.

Assets that last less than a year or debts that are due within a year are considered “current”. Assets that last more than a year or debts that are due in more than a year are considered “non-current” or “long-term”.

Individuals have balance sheets too. You can create a basic one in Excel or Google Sheets by listing your assets (bank / investment accounts) and liabilities (loans) and your account balances. Rather than equity, you have net worth, which is your assets minus your liabilities.

07/23/2024

Progress, REAL progress, takes time. But with consistent ex*****on of actions toward your goals, you will achieve great things.

07/18/2024

A dollar can only go so far, so spend your hard-earned money wisely. One-off situations come up all the time and your exact spending pattern is unique to you.

But, to make the most of your money and not stress about missing important payments, prioritize your spending as follows:

1.) Pay essential bills (rent, utilities, home repairs, food, clothing, loan payments)
2.) Reserve cash for taxes (the ones not withheld from your paycheck like property and real estate)
3.) Reserve cash for insurance (the ones not withheld from your paycheck like home and auto)
4.) Reserve cash for an emergency fund (set aside $10 - $50 per month until you have enough to cover 3 – 6 months’ worth of expenses)
5.) Put $10 - $50 per month into a retirement account (if you don’t have one through work you can open an IRA, if you do have one through work contribute at least 3-5% of your pay)
6.) Put $10 - $50 per month into a taxable account (regular investment account)
7.) Put $10 - $50 per month into a college savings account (529 account, etc.)
8.) Anything left you can use to have some fun!

07/16/2024

Roth vs Traditional. What does that mean and which should you do?

A Traditional IRA is funded with pre-tax dollars (the amount you put into the account is used to reduce your income in the year you fund the account), earnings are not taxed, and funds are taxed when you take money out of the account. The account is subject to required minimum distributions (RMDs) so you can’t leave the money in the account to avoid paying taxes.

A Roth IRA is funded with after-tax dollars (you can’t take a deduction on your tax return when you fund the account), earnings are not taxed, and funds are not taxed when you take money out of the account. The account is not subject to RMDs.

Which one should you do? That depends on when you’ll need the money and what you think your future tax rate will be.

The general rule of thumb is that workers would benefit more from funding a Roth IRA until about age 45, or about 20 years from retirement. After that, there likely won’t be enough time for your money to grow enough to recuperate the funds you lost from paying taxes upfront (and the amount you lost in potential earnings on that money).

Your future tax rate is also important to think about when deciding between Roth and traditional IRAs. If you think you will be in a higher tax bracket or will be earning significantly more in the future when you are likely to take from your IRA, then it would be better to fund a Roth IRA and pay taxes now. On the other hand, if you think your earnings and tax rate will be about the same, then it would be better to fund a traditional IRA now and pay taxes later when you take from the account.

Address

Philadelphia, PA

Telephone

+12673418804

Website

http://propellerbookkeeping.com/

Alerts

Be the first to know and let us send you an email when Propeller Bookkeeping, LLC posts news and promotions. Your email address will not be used for any other purpose, and you can unsubscribe at any time.