Amy Bradley Radford (00:01)
Well, hi everyone and welcome back to the podcast. If you're new here, my name is Amy Bradley Radford and this space is about helping massage therapists build something that actually works for them long term, not just physically at the table, but financially, energetically and sustainably as a business. And today's conversation is one that I know a lot of you need and maybe also one you've been avoiding just a little bit because most therapists are tracking their schedule, their clients, how full they are, how tired they are.
but not their numbers. And if you're trying to create real stability or grow into something like a six figure business, you can't build that by guessing. Your numbers are the thing that actually supports your growth. So today I brought on Danielle Hayden. She is the founder of Kickstart Accounting. She has her own podcast and she works with business owners to understand what their numbers are telling them so they can make smarter, more confident decisions. And what I really appreciate about Danielle's approach
is that it isn't just about doing your books. It's about teaching you how to read your numbers and actually use them. So Danielle, I'm really glad you're here with us today.
Danielle Hayden (01:06)
Thank you so much for having me.
Amy Bradley Radford (01:08)
Well, know, I wanted to, after I met you, after I met you, I want to be one of your clients. But after I met you, I really have come to appreciate what you're offering to people out in small businesses. And so I want you to tell us a little bit about yourself, your story, and how you became the owner of Kickstart Accounting.
Danielle Hayden (01:28)
Yeah, gosh, I started my entrepreneurship journey. I originally was a creative. my first career was as a hairdresser. So I worked behind the chair as a creative. I realized I had a knack for helping the salon owner and the other girls that were behind the chairs ⁓ understand the money part
of what we did and how to use numbers as a tool to achieve our goals. And so I had a knack for that behind the chair, ended up in corporate accounting where I found myself doing the same thing, helping the private equity firm, investors, CEO, the board of directors, using numbers as a tool to make business decisions. And so...
I realized I wanted to bring access to this level of information to every small business owner out there. So any solopreneur, anybody looking to go off on their own and to control their financial destiny and their own financial journey, want them to be able to have access to these tools and then understand their numbers to be able to use them as that tool for...
guiding success in our journey.
Amy Bradley Radford (02:44)
You know, think it's actually wonderful because as a business coach, I try not to give financial advice to people because I don't feel like I'm qualified to do that. can give them ideas and I can help them understand how to run their business, but when it really boils down to it, most of the small business people I work with don't even want to deal with their bank statement. And so I think this is such a valuable piece for them to know what's available for them.
because it isn't just going to an accountant. Like on my last podcast, I talked about how sometimes my idea of what I see in my numbers and what my accountant tells me are two different languages about the same topic. And it's confusing. And then you get frustrated, and then you think, can't do this. And then you just don't pay attention to it. And you just spend and take money home and spend and take money. And so I think we have a lot of really good
Danielle Hayden (03:23)
Very different. Two very, very different things.
head in the sand. Yeah.
Amy Bradley Radford (03:39)
⁓ things that we can talk about for our audience today to just really give them some direction and help them know that, well, let them know that help is available. So, when you look at service-based business owners, especially women, what are you seeing most people understand when it comes to their numbers early on?
Danielle Hayden (03:59)
what they don't understand.
Amy Bradley Radford (04:01)
Yep, when it comes, what are they misunderstanding?
Danielle Hayden (04:04)
Yeah, there's several things that I'll say in here, ⁓ but I want to start with the fact that ⁓ when we show up as a business owner, we do not leave all of our money mindset behind us. So meaning the way our parents talked about money, the way that that tax account talked to you, the way that our teacher talked about money, maybe a friend's parents talked about money, like all of that.
It's coming into entrepreneurship with us. And so we don't get to turn that off. We actually have to work through that. And I want everyone to hear me really clearly, no matter how small you're starting with, you are now responsible. You are responsible for where you're going to go in terms of your numbers. The IRS,
They actually don't care if you're good with money or if you understand your numbers. And I know that's hard to hear, like nobody cares, but like the IRS does not care. They don't care if you get it. They don't care if you struggle with math in high school. So it's our responsibility now that we have decided to take on clients and to be, to file the LLC and to be a business that we are now taking responsibility for our own journey.
Amy Bradley Radford (04:58)
Mm-mm. Mm-mm. Mm-mm.
Danielle Hayden (05:23)
And so the head in the sand is not actually a strategy. And you can find a team, you know, I hear you say the way that my accountant speaks about money and the way I see money, they're two different things. And I understand as a CPA, we have this whole language that we use. And that's why I really try to put that to the side because more importantly,
Amy Bradley Radford (05:42)
Okay.
Danielle Hayden (05:47)
I want all of us as business owners to use our numbers to make better business decisions. When we land in tax season prepared and calm and ready, that's like a bonus because we've already been using our numbers all.
Amy Bradley Radford (06:02)
It's huge, huge difference. I've talked about this for I don't know how long, of what I did in the beginning of my business and what I have learned how to do all came through some really hard, hard lessons that I'm sure that you have seen all along where I,
took money and stuck it in my pocket and didn't claim it because we didn't want to pay taxes or I tried to expense myself out so I didn't have to pay taxes and you all of these things that don't value you as a business owner and then make you wonder if your little business can actually take care of you. Those are all mistakes that I see lots of people making and I didn't understand my numbers until somebody sat down and talked to me about them and taught me I had to ask and taught me how to actually run my numbers so the service that
you're offering people to help them really understand what their business is doing in terms that they can understand, that is huge. That is absolutely huge, okay? So I just wanna throw this one right off the bat because this is a question that's been coming at me quite a bit lately and that is, is a six figure income realistic for a solo massage therapist and what has to be in place to get there?
Danielle Hayden (06:55)
Yeah.
Absolutely, it is realistic.
I think several things have to be in place. We have to value our time and our energy. And there are things that only you can do, right? You're the only one then who can see clients. And when you are laser focused on how you generate revenue, the prices that you charge, you need a support team.
you cannot do everything yourself. And I say this no matter what business we're in because we all can take off the superhero cape and say, I am allowed, I am enough, I do enough, and I can get support. And that might be, I'm talking about it in terms of bookkeeping and tax, but that also might mean a VA, somebody to help you with the social media. It might be website and IT support. Whatever is,
holding you your time and your energy, that deserves support so that you can be laser focused on only the things that you can do and the things that light you up and give you energy.
Amy Bradley Radford (08:21)
Very powerful, actually. so you know, just last week I was having a conversation with one of my clients and she was asking me how she could get to this place where she was charging 125.
And the conversation we had was exactly what you're talking about. What can you let go of and how do you increase your customer service? Because you have to take from one place to give to another and let someone take over so that you have the ability to grow that capacity inside yourself in order to create that opportunity. And you can't do all of that by yourself.
You can't, you have to bring in other people to help you do that. And why wouldn't you? Why wouldn't you, if you are climbing this ladder of success, bring people and tools in to help you in order to maintain that place as well?
Danielle Hayden (09:11)
It's money mindset. It
is worthiness and deserving and realizing that you deserve support. You are worthy of support. Your business is big enough and you do enough and you get to have support in your business and you get to fill your days with only the things that light you up.
It almost feels like, oh my gosh, am I allowed to do that? But yes, I am here to give you permission to do that.
Amy Bradley Radford (09:39)
And you know, I'll be honest with you, when they talk about like, formulating your business plan in massage school and coming out with this little business plan, none of this, none of this stuff we're talking about is in there. This is just how do you actually fill your schedule and get busy. That's what we usually talk about.
We don't have the mindset, and I love to open people's minds about this, they don't have the mindset of how to take themselves through each one of those stages and on up in order to grow their practice into something they really want it to be.
Danielle Hayden (10:12)
So I've been doing this for 11 years. I've worked with thousands of business owners over the last 11 years. And I can tell you, no matter what the industry is, we do not educate people enough on the business side of running a business. And then for some reason, we feel all this shame. Like, my god, why don't I know how to operate systems? Like, why don't I know how to lead? How do I know? How do I not know how to do bookkeeping?
Amy Bradley Radford (10:26)
No.
my gosh.
Danielle Hayden (10:38)
Well, guess what? Nobody taught you, and that's why you don't know.
Amy Bradley Radford (10:42)
And it's okay, we give you full permission to accept that, that
you don't know, but there are tools. There are tools that are available to us that help us go that way. know, Danielle, I have to just pop in right here because one of the things that I've noticed with the little bit of time that I've got to know you is you're such a real person. You're such a real person. I mean, when I've gone into accountants office and worked with them, it's like this mask of accounting comes across, but it's just so real.
Danielle Hayden (10:48)
There are tools. Yes.
Thank you.
my God, I know.
Amy Bradley Radford (11:10)
and you kind of have the same value system I have is there's emotions and there's thoughts and there's feelings and these things run your business and not necessarily in a good way and I know you talk about this. So what do you have to say about that fear driven, emotionally response, made decisions and those sorts of things?
Danielle Hayden (11:31)
I'm going to tell you about Joe first and then I'll tell you about fear and decision making. I'll never forget my first year in business. I went and used my family tax account and I am a CPA, but I'm like, I need a third party. I want somebody else to kind of be my checks and balance. And I'll never forget driving there that day. I have naturally curly hair and it was a hot sticky day out. And I just like feel a massive single mom. I felt like my kids were little. I felt like there was like
Lollipop gunk in my air.
Amy Bradley Radford (12:00)
Sticky, stickiness everywhere.
Danielle Hayden (12:02)
Yeah,
and I remember feeling like I know I didn't do everything perfect this year. I know it. I know that I didn't pay myself correctly. didn't do things perfectly. And I felt it. I walked into Joe's office. It's the same old paneling on the walls, the dirty floor. And Joe, yes, yes. And Joe,
Amy Bradley Radford (12:23)
can smell it. I can smell the ink.
Danielle Hayden (12:28)
Working on my return and he starts shaking his head.
And I said, I'm already feeling ashamed. And I said, what's wrong, Jo? And he said, well, you and your little.
And like with a straight face and shamed me for everything I had did right and wrong that year. And I walked out of Joe's office and said, I will make sure that nobody ever has to feel that way again. Like I will make sure that there's another option out there for as long as I live, that nobody ever has to go through that experience again. And that's why I do what I do today because there is emotions
like no matter how big or small your business is, you are deserving of having that business and the tax write-offs that comes along with it and the information that you need in order to run this business. Now, I remember being at the crossroads moment where I had a lot of fear and I used my numbers to look backwards.
to be able to see where I've been in my business. My numbers, like we hear the cliche, your numbers tell you a story, but like literally they actually tell you a story. The reason that's said is because it does. And so your numbers, they are showing you, if you are willing to look, when you look at your income statement, your balance sheet, it is literally giving you the guide and telling you what's working.
Amy Bradley Radford (13:45)
Thank you.
Danielle Hayden (14:03)
and what's not working. And then, as a CEO, you get to decide, here's what I'm gonna start doing, here's what I'm gonna stop doing, and here's what I'm gonna continue doing. And every single month, you get to say, ⁓ man, that's a lot, I can't believe that much revenue came in, or I can't believe I lost all those sales, I can't believe I spent so much money. And you can be really reactionary for like 30 seconds. my God, wow, that's a lot.
Okay.
Amy Bradley Radford (14:36)
you
Danielle Hayden (14:38)
And now I can hear like, from everything that my numbers are telling me, here's what I'm going start doing, here's what I'm stop doing, and here's what I'm going to continue.
Amy Bradley Radford (14:47)
So I understand that shame.
I do understand that shame and I understand how sitting in that shame you choose not to ask questions and you try and do things all by yourself or you try and figure things out all by yourself and that's not the healthiest place to do and you know one of the podcast episodes that I did was called understanding your value as a massage therapist because I think when you don't know enough about and I'm just going to say bookkeeping when you don't understand your numbers my dad called him the black and white.
If you don't understand your numbers, then you don't understand how to take yourself to another level. And you get stuck in this place where you are so undervalued by yourself that you get to a point where you're burned out and you don't want to move on. And you know, when I've worked with some people that are, they're doing amazing amounts of massage, but they haven't even written down or tracked how much they made that month.
Danielle Hayden (15:30)
Mm.
Amy Bradley Radford (15:43)
There was one lady I worked with and she's like, I just need to make more money. I just need to make more money. And so we ran the numbers for her, like how many massages and what she was charging. She was earning over $13,000 a month working to the end of her capacity because she didn't think she was making enough money because she didn't actually see the picture.
Danielle Hayden (16:05)
Can I tell you about my client Jenna?
Amy Bradley Radford (16:07)
⁓ yeah,
completely.
Danielle Hayden (16:10)
So she
came to us a few years ago and she said, Danielle, you know, I need you to teach me how to operate my business at a loss. Very quick request, but figure it out. So we did what we call a catch up. So the catch up is where we take all of your historical information and we bring it into QuickBooks. And so we did from January of that year through November. And I said, hey, Jenna, there was our financial review call. said, I have good news and bad news.
Amy Bradley Radford (16:18)
⁓ okay.
Danielle Hayden (16:35)
The good news is I don't have to teach you how to operate your business at a loss. The bad news is that it's November and we don't have much time to implement any tax strategies. However, here's what we found out with Jenna. She was commingling business and personal expenses. And because she couldn't see how much of the personal expenses and owner's draws, how much of that was leaking from her business, she always felt like she never had enough money and that there wasn't money in her business checking account. But it was really just an act of commingling.
Amy Bradley Radford (16:43)
Right.
Danielle Hayden (17:05)
and not being able to understand where she was spending money. Why I want to tell you this story is that there was this moment where she like clicked. She said that she no longer saw herself as a freelancer. Like, I'm not doing this on the side. I'm not a side hustle. I'm running a business. And from that moment on, her entire perspective changed. We send her her monthly financial statements every single month.
She gets the snapshot, which is a CEO dashboard that shows her, income, her top five operating expenses, her profit, how much to save for taxes, where she's spending money and how that compares to other business owners. And every month she's able to check back in and say, okay, if my goal is to grow this business, then I need to be spending eight to 10 % of my sales in advertising and marketing. Am I doing that? Like, am I spending?
in a way that aligns with my goals. And so she actually took some time off when she had a baby. And when like we navigated that, like how much do we need to have saved? How much do we need to have in team who's gonna help us get through that time? And then how much do we need afterwards? By setting a goal and budget, she completely transformed as the person who shows up to run the business, both mentally and energetically.
Amy Bradley Radford (18:31)
Mm-hmm, yeah. When you talk about burnout, burnout has lots of capacities to it, but this little cycle that you just talked about right here is one of the biggest ones I see in burnout. They don't know, so they don't know, so they don't know, and they keep pushing, but they shouldn't be because they've already met their goals, but they don't see that they've met their goals. And so it drives, it drives a lot of behaviors that are not serving you and growing your business at all. Mm-hmm, yeah.
Yeah, of, gosh, we could talk for hours, hours and hours. Now, the stuff that I see, you know, Danielle, this is why I went into doing a podcast about business for massage therapists is because I saw the same thing and I looked at it more as a, you know, just understanding how to run yourself, not necessarily your numbers, because like I said, I get nervous talking to people about their money, but teaching them how to manage their own behavior, their behavior in there.
Danielle Hayden (19:05)
I know.
Amy Bradley Radford (19:31)
business. So what are some of the key things you talk to people about their behavior in their business? What are are their numbers teaching you so you can teach them about their behavior?
Danielle Hayden (19:43)
As part of your money team, we are giving you the data so that you know what has just happened in your business so that you as the business owner and CEO can decide how you want to show up and how you want to run your business. And I say that because having the data is the first step. The next step is to say, OK, what are my goals, both business and personal?
Like where do I want to see myself in 10 years and three years in the next 12 months? Now, if that's the person I want to be in 12 months, here are the things that I need to do today in order to get me there. I need to have a money team. I need to look at my numbers at the end of each month. I need to compare how I'm spending to where I want to go. Now use the example before of advertising and marketing, but I think that this is a really important one for people to hear because we'll get on financial review calls.
and our clients will say, well, my number one goal is to grow my revenue. I'm like, okay, perfect, sounds great. What are you doing to get there? If we are not addressing our pricing, if we are not marketing, if we're not spending money on operating that business, we are not going to grow. So I wanna see eight to 10 % of your sales in advertising and marketing. I hear people say to me, God, I'm just...
Amy Bradley Radford (20:49)
Thank
Danielle Hayden (21:07)
I'm burned out, I'm tired, I'm doing everything myself. And then I'll say, show me your income statement. I can answer any question you have by show me your income statement. And when I look at the income statement, I should see about 6 % to 8 % of your sales going to operating expenses. You know why? Because you should not be doing things manually. You should have systems and tools and processes that help you manage your business. If you want to be able to...
have a work-life balance, whatever that means for you, you will need outside services, meaning you probably shouldn't be spending your time on Sunday mornings doing your bookkeeping or figuring out how to run payroll or how to add yourself to payroll or how to file your tax return. So we need to have outside services in our business. So again, 6 to 8 of our sales on having a team of people, a VA, that's another one of outside services.
Amy Bradley Radford (21:52)
Thank
Danielle Hayden (22:02)
those team members who are gonna help us. And so I'm kind of going through the whole income statement with you right now, because I want people to really hear me to say that your numbers will help guide your behavior. And by saying, this is where I wanna be as a business owner, and then you should be able to match who you wanna be with your income statement and where you're actually spending your money and your energy.
Amy Bradley Radford (22:31)
Well, you know, I have to jump right on board here with the VA because I just hired my first VA. And the reason I did that is because I was editing my podcast on Sunday morning going and I wasn't getting to the work I wanted to. And I recognized that, but I had to stop.
Danielle Hayden (22:36)
Okay?
Amy Bradley Radford (22:46)
I had to stop and say, what do I need to do to help me so that I can build my business in a different way? I have taken it as far as I can go with all of my resources and energy.
and now it's time to bring other people in because it can't go any further. I had nothing more to give to grow, to grow my mighty but little business and I can totally go there with you. And you know, massage therapists can look at other things like laundry services or really having someone take care of their bookkeeping is huge or being able to track things better. Just things that help you offset so you can put more time into your business because you make money.
at the table. How do you support yourself at the table more? How do do that? All right. I actually have two questions that I know people want to know. before we hop into those, we're going to bring up something that I hear from people that is interesting.
You know, I've listened to some of your podcasts, love them, and you talk a lot about how the goal is to pay taxes. The goal is to pay taxes. So can you explain that to my audience? Because I think many of them try to not pay taxes.
Danielle Hayden (23:56)
Yeah, it is a point of contention with me in the tax world. So there is so many tax influencers on on social media and out there teaching people how to put their whole personal life through their business so that you don't pay money in taxes. But I want to go back to my story about Jenna. And one of the...
One of the things that were holding Jenna back in her business was the fact that she was commingling her business and personal expenses. And some of them, she maybe could have painted a story as some type of random tax write-off, but she knew that she wanted to build something that stood the test of time and was valuable. And when she went to go finally buy her home and the car and a line of credit for her business, she wanted to expand.
Like she needed for each of those, she needed profit. So I remember when she went to go buy her house, she was like Danielle, thank God you helped me get on payroll two years ago. Because I'm an S-Corp and because I pay myself through payroll, I now have a paycheck stop to say, yes, I can afford this house lender. Please give me this home. I've been on payroll for the last two years.
Amy Bradley Radford (25:05)
Mm-hmm.
Danielle Hayden (25:06)
And then she later decided to open up a location where she could bring on other team members and she took on a line of credit in order to build that space out. Well that line of credit she needed to have profit in order to be able to build out. Now I know that those things might not be in your in somebody's preview purview right now but we we need to take responsibility for not just who we are today right like
Not paying taxes, that's a short-term comfort. Long-term, like what, how are you building something that's sustainable and valuable where you can do this and it can support you in the long haul for whatever your goals morph into into the future. And that's by creating a profit. And those profits, yes, you are gonna pay taxes on. The other benefit of it is that when your personal expenses are coming out of your personal account,
and your business expenses are coming into your business account, you actually understand the health of your business. And that right there is worth his weight in gold. And then you can see, OK, I have a personal spending problem, and it's not really my business. It's actually my husband.
Amy Bradley Radford (26:13)
Yeah.
It's actually on the personal
side. My business is wide, but my personal isn't.
Danielle Hayden (26:24)
Yeah,
and I want people to be able to say that. We had one client who just, she really had a door dash problem. And it looked like it was coming out of the business account. we had talked her about it several times. And then finally she said, you know, it's really my kids. And it was personal expenses coming out of her business account. so long story short.
Right, the reason I want you to have a profit in your business is so that you can create something of value. So no matter what, you go to buy a home, a vehicle, line of credit, you want to sell your business one day, that you have something of value and you know the health of your business.
Amy Bradley Radford (27:06)
I'm a perfect example of this because there was a few years in there where I thought, know, joint income, this is a great time for me to expense myself out. So not as much went home, but then we couldn't show enough money to do the things we wanted to do. Yes, you know, and so you can either hide it or you can have it, but it, yes.
Danielle Hayden (27:29)
I like that.
Amy Bradley Radford (27:33)
But you don't get both. You don't get to have your cake and eat it too. So if you want to be an adult and a grown up, you have to show that revenue and you have to be able to pay taxes. But it's like my dad told me. He says, if you're paying taxes after you've done everything right, it's okay, you're making money. It's okay. You're making money. Yeah.
Danielle Hayden (27:50)
You're making money. Like, I want people to hear that. If you are
paying taxes, you are making money. Congratulations. And honestly, a lot of the complex tax strategies that are out there, for me, I'm not into real estate. Like, I'm not doing that. And a lot of the that the complex strategies that are out there, unless you're buying big equipment and real estate, like, do the basics. You know, invest in your retirement. Save it through an HSA.
Amy Bradley Radford (27:56)
me. Yeah, exactly.
Danielle Hayden (28:15)
There are small things that you can do to make sure that you're preparing for the future and maximizing your tax strategies, but it's not putting every personal expense you have through your business.
Amy Bradley Radford (28:26)
Yeah, it's not. And you know, that brings up something that I get asked a lot, and that is, you know, I'm not working for a company, they haven't set up my accounts for me for retirement, I don't have an IRA, I don't have all these things, and when I talk to people about setting up their structure for when they retire, they're like, well, I don't have enough money to do that. I hear that all the time, I don't have enough money to do that, I don't know how to make that work for myself.
and getting people like when I get someone that I work with and they're undercharging and then we teach them how to charge what they need teaching them not to spend everything that they're making and understanding what that plan is what should people be planning for how does that fit into this you know this money team that you're talking about how do they learn about
Danielle Hayden (29:18)
So I want everybody to have four people on their money team. And I know it sounds aggressive if you're like, I'm a solo printer. You want me to have four people on my money team? Hear me out. The minute you become a business owner and you have consistent revenue coming in the door, you need to have a bookkeeper. Your bookkeeper is the most underrated team member that you're going to have. They keep all of your transactions strategically categorized. Imagine a thousand piece puzzle dumped on the coffee table in front of you.
I hate puzzles and I will see that and I'm like, for the love of God, that sounds terrible. But put together a nice, beautiful picture. It's like, wow, that's I can't believe you did that. That's beautiful. Bookkeeping is this art where you get to see nothing but the completed picture because somebody is back there doing all the difficult work of strategically categorizing every single transaction. Then we have our tax preparer. Your tax preparer is not your bookkeeper.
They are the person who is there to prepare your tax return and to answer any tax questions. We cannot blindly listen to our tax accountant because they are not thinking about your future goals or how to run the business or how that fits into your business strategy. Their only goal is to save you money on taxes and to file your tax return. Your bookkeeper and your tax accountant should work together to understand your goals as a business owner and to ensure that those two are working together.
Our person number three is our CFO. Our CFO helps us look to the future. So how are we going to set a 10-year North Star, a three-year plan, a one-year budget? Maybe that's not something you're ready for right now, but I want you to understand all the options of the people who are going to help us long-term. The fourth person is your financial advisor. And the financial advisor helps us both in business and personal, of put all that together.
And that's your retirement options, your IRA, helping to make sure that you and your family have all the pieces that you're saving for the future. Again, all four people should be working together to help you make sure that you are taking where you want to go and then implementing the strategies that are gonna help you get to where you want to be.
Amy Bradley Radford (31:35)
Yeah, and going out and finding each one of those people is time consuming and taking the data to each one of those people. Fortunately for me, my accountant did financial advising and he had run businesses. And so he was willing to combine some of those roles to talk to me about some things, but still there was lots of gaps. And so it's amazing when you can bring all of that together because I know that's a missing piece for a lot of people in my industry of understanding how to take themselves some.
They believe that once my schedule's full, that's as far as we're gonna go. We're just gonna keep plugging away at a full schedule. And it's so much bigger than that. It's so much simpler and so much bigger all at the same time to take your little business in a completely different direction. Yeah, no, think that was excellent. That was very well said. Thank you very much.
I have a question and I've been asked this question and that is when does a wee little massage therapist decide to take their business from an LLC to a corporation and why would they do that?
Danielle Hayden (32:38)
Yeah, favorite question. So as an LLC, we can become taxed as an S-corp. I want you to hit three milestones first. The first milestone is that your business is bringing in about $75,000 a year in net income. Not gross, not sales. Sales minus cost of goods sold minus expenses, net income. We have $75,000 for
two years or more, not one year, two years. Once you become an S-corp, you have to pay yourself a reasonable compensation. It's not Danielle's role, it's not Kickstart Accounting's role, it's the IRS's role. You have to pay yourself a reasonable compensation before you can take owner's draws, and so we need to make sure that you're bringing home enough net income that it's gonna be tax advantageous for you. So the number's 75. Number two is I want you to have your business and personal expenses.
completely separated. You're no longer doing any of this commingling baloney because you need to have accurate bookkeeping as an S-corp because when you go to file your tax return, you need to have a balance sheet. And so we have to have accurate bookkeeping and we can't be commingling business and personal expenses. The third one is that you are consistently paying yourself an owner's draw today. It's like going on a diet on Monday for the 25th time this year.
Like we're not gonna stick to it. So same thing here. It's the same thing here. I want you to already be paying yourself an owner's draw because once you become an S-corp, the IRS says you have to pay yourself a reasonable compensation. So we need to have that habit in place.
Amy Bradley Radford (34:19)
Well that answered a great question because I get that question and I'm like, talk to your accountant.
Danielle Hayden (34:24)
Yeah, yeah.
And it can be very tax advantageous. So the reason people want to do it is that you'll pay less in self-employment tax. The other thing that I like is that you're going to have a paycheck stub. So when you go to buy a car or go to the home loan, you have a paycheck stub to show them. I like the idea of building a valuable business. And by paying ourselves through payroll, we're creating something of value.
Amy Bradley Radford (34:50)
Yes, and there comes a point in time in your business that you need to do that. I love having that number because no one's ever given me that number. It's just like, well, when you think you should, you should. The answer I got was when you're trying to separate yourself more out of this or pay yourself so you can take a paycheck home or something. That's something that I talk with my little solopreneurs about too is,
There's a lot of people that say, wish I just had a paycheck. I get tired of taking money from one account, putting it into the other to pay a bill, or taking money out every week, or every other day as soon as I get money in them. I'm swiping this money across and it never feels like a pay check coming to me.
Danielle Hayden (35:18)
Yeah.
You deserve
to be paid.
Amy Bradley Radford (35:32)
Why don't we talk about that? I know you have some great information for people around a paycheck.
Danielle Hayden (35:39)
Yeah,
I want every single business owner to be paid. You are working in your business. And when we don't pay ourselves, that's when we start to commingle business and personal expenses. And ultimately, you become resentful of your business. So these are all things that your money team, those four people who I talked about before, these are all the questions that they should be able to answer for you.
So when you talk to your bookkeeper and your tax account, they should be able to say, hey, yes, here's how much you can afford to pay yourself. Here's when to become an S-Corp. Here are the strategies that you need to help you use your numbers to make business decisions.
Amy Bradley Radford (36:18)
Yeah, I've talked a lot about learning how to reserve and pay yourself every one to two weeks, a chunk, a chunk of money. Not just that you shouldn't be paying yourself like you're talking about, but feeling like you're moving money to yourself in a way that feels valuable, that it values you, you're valuing yourself. And that behavior,
makes a huge difference for longevity, actually. So I've talked to people about doing it in their little LLCs and they can do it in their corporation as well, but just the act of paying yourself is huge. It's absolutely huge. Yeah, you are worth it. so.
Danielle Hayden (36:57)
You're worth it.
Amy Bradley Radford (37:00)
Danielle, what would you like to talk about? What's one more question you want to talk about?
or one more thing you want to bring up.
Danielle Hayden (37:08)
Yeah, if there's one thing that I can leave the audience with is...
Circling back to I want you to think about the decision that you're not making. Like that decision as a business owner that you know you need to make. And that might be increasing your prices. It might be hiring the VA, bringing on a new product line or investing in some different cost of goods sold, some different inventory.
Whatever that decision is, I want you to think about how you currently make that decision. Like, is it a gut decision? Is it emotional? Is it reactionary? Do you talk to somebody? Like, how do you make those decisions? And I want to offer to you that there is another way. So every time I go to make a business decision, I look at my numbers. I ground myself in data. I look at everything that just happened.
this year, last year, over the last three years of my business, I go backwards. And then I look at my budget and I say, okay, here's where I want the business to go. Here's where I'm going in the future. Now with those two things in mind, how do I make this decision that's gonna best align me to the person I wanna be next year? And so I wanna offer that reframe for you. Whatever the decision is that you're making right now, how can you use these strategies
to make a different decision for you in your business.
Amy Bradley Radford (38:40)
And I think that's great. I mentioned this earlier, my dad talked about the black and white. He was a business owner for 40 years and he invested in different things. And I remember coming to him one time, I actually owned a massage school at the time, I was crying. I was crying because nobody liked me and there was all these decisions and everything and he listened to me. He did, listened to me and I was fearful of the future and fearful of this and we needed to make more changes. And he finally sat down and he looked at me and he says, honey.
What does the black and white tell you? And I went, that I'm fine, that everything's fine, and I'm going the right way. And he's like, OK, now you can cry. it was, you know, it's that separating that emotional from the business that is huge. And when you can see those numbers, I know what you're talking about. When you can see those numbers, it's amazing.
Danielle Hayden (39:14)
Yeah.
Amy Bradley Radford (39:31)
So Danielle, you've given us such amazing information. I'm so excited to meet you and I'm so excited that this is a opportunity for those listening in my audience. But can you walk us through how you support your clients with Kickstart Accounting?
Danielle Hayden (39:45)
Yeah, so we work with clients of all sizes. Like I said, my goal is to bring access to every single business owner out there. So we work with solopreneurs who are growing and developing. We help with the bookkeeping aspects of the accounting. So your role as a business owner is to come in.
understand the numbers and to use them to make business decisions, but how do you do that if you don't have accurate financials in front of you? So our team creates and manages the bookkeeping, provides you with the CEO level data that you need in order to make business decisions. And I think as a solopreneur, owning a business is lonely. And so our team is this amazing group of people who...
love to celebrate with our clients and to be there for them when things aren't going well and really connect human to human and to be there for you in your business journey. So we love working with solopreneurs so that we can help you and support you and grow alongside you.
Amy Bradley Radford (40:49)
And I'm just gonna put this in here right now because I know, I know what people are thinking, this sounds great, I can't afford it. You can afford it. She's very affordable. She has some really great plans for the little solopreneur up to the multi-therapist practice. You just need to go check out her information and you will thank yourself for doing that. So Danielle, I wanna thank you for being on the podcast today. You've given us a lot of really great information. Love to have you come back again and give us a little more tidbit as we
work our way through learning how to run our businesses. But thank you so much for coming.
Danielle Hayden (41:23)
Thank you very much for having me here.
Amy Bradley Radford (41:25)
talk later.
