Making Money Online as an Influencer and How to Budget Properly | 2023
Making Money Online can be a very lucrative business; but how you manage it will make all the difference.
In the past, I've always been pretty transparent about what I make from my business in hopes that people would be motivated to start their own brands; but after going full time, I've realized that making a bunch of money just isn't enough. Whether you're making an extra $40k or $200k; how you budget and plan will be the determining factor for how your new side hustle will set you up for success.
So today, I thought I would share a full look into not just what I've made in 2023, but what I've spent. I will be sharing the budgeting and planning strategies that have helped me to be the most successful and hopefully there is something you can take away from it!
Being a business woman has definitely taught me a lot; but my growth in finances has probably been my favorite area to continue to grown in. Lets take a look at the damage for 2023!
Now looking at this chart; one might think that my 2023 didn't go so well; but I think the complete opposite; and I'm going to get into a little more detail on why I think this way!
First, I must talk about how I organize all of my accounting information and stress how important it is to keep up with all of your business expenses and income! Quickbooks Online has always been a favorite of mine. It helps me organize all of my accounting information and makes tax time A LOT easier! Whether you make a little or a lot; you want to get into the habit of organizing your finances early on. If you're interested in checking out I have a 30% off discount for new members for 6 months.
Profit First Model
I just recently adopted the profit first model for my business and It has definitely been a game changer for me. This has really helped me to organize my business income effectively. To explain it in a nutshell, there are several buckets that your business income is categorized into and based on what you make, there are guided percentages that help you determine where to put your money. This really helps me stay within my financial goals for the year.
Here is an example.
- Tithes - This category isn't in the Profit First Model but this is a decision I made personally for my business; this is a non-negotiable for me; God always gets his first
- Tax - Putting taxes aside immediately when you get paid really is a must for me. I don't even want to play with Uncle Sam's money and with the amount that Im bringing in; it would be easy to lose track and get behind if I don't set it aside right away.
- Owners Comp - This is the bucket I use to pay out my payroll and contract labor expenses. So paying myself, my assistants, etc.
- Business Profit - This category is set aside for business profit; I typically use this money for big purchases I want to invest in; but with this renovation, lately this has been used for projects!
- Operating Expenses - This is the account I use on a daily basis to pay my everyday expenses. This account gets the most traffic.
- Retirement - This isn't listed in the profit first model either, but I value putting money away for retirement; so I pay out one for my employee in a SEP IRA!
This year was a pretty good year for me considering all of the things this year brought. I was able to have the opportunity to film a TV show this year which was super fun; but this also took me away for a couple of months and then I was diagnosed later this year with Lupus and really struggled physically to do projects later in the year; so I had a HUGE decrease in income this year for those two reasons alone; but I still felt like I had an amazing year inspite of that.
Although I wasn't able to work as much; I was still able to do really well this year and I attribute that to the diversity of my income. These are all the ways I made money this year, in order from the most made
- Brand Deals
- TV Show
- Speaking Engagements
- Ad Income
- Product Sales
- Design Services
- Affiliate Income
If you'd like to have more info on how I made this income, be sure to check out my ebook "How to Make Money Online" it details all of the ways that I make a living and how to do it, and trust me ITS JUICY! I mean if I give you all this for free, imagine what I can provide in an ebook. You can check out my podcast episode on the topic to get a feel for what it entails!
Now let's get into the expenses, because a few of these need some explanations. Again, from first glance it may look like I really haven't made any money, but also remember that an investment back into your business is always a good thing!
As you can see from the table above, payroll was one of the bigger expenses on the Expenses list. Here is the good thing about this expense! Because I am classified as an S Corp; I get to hire myself as an employee and pay myself a wage. This is great news because I get to pay myself and it gets classified as a business expense; which lowers my taxable income. Being classified as an S corp also comes along with some tax benefits.
If you are making a substantial amount of money; I would consider talking to a good CPA about whether a S corp classification is a good move for you! Are there any changes that come with that? Well for me; now that I have that classification, I make a quarterly payroll tax payment and payment into social security; other than that I've had no other obligations.
Contract Labor and Supplies/Materiels
These two categories were some of my other bigger expenses, so I want to note that these numbers are very inflated because of my current project. Normally, these numbers would be a lot smaller but I have committed to investing a lot of my money to my current flip project. Let's just say getting my business building to a finished point took a lot of work and money; but it was a great investment back into my business; and now I have a dedicated space where I can do all of my business work; aside from my house.
Now I will say that I didn't always follow the percentages from my profit first model on this category and it almost got me in trouble. I definitely overspent in some areas and I learned first hand why that was a bad idea. So if you have set percentages for your business; just stick to it. It will save you a lot of headache!
This is another area that I'm sure a lot of people will argue is way too much; but again this a personal choice for me and my advice here is to do what's best for your business always. Only you know what decisions will serve you best; but I can attest that God has blessed my business tremendously because I always make a conscious decision to bless Him. God is Good!
I always just love talking about taxes (sarcasm). When I worked in corporate America, my taxes were automatically taken out. It was a huge shift to actually get all of the money in my hands and I almost feel like this is a set up for failure because you see all of this money but then a big chunk goes to the IRS. My advice here is to make sure you're smart about putting a set amount aside so you don't get behind on this.
I typically make estimated payments quarterly to the IRS and keep a separate tax account out of sight to help ensure that I don't accidentally dip into this money!
All in all; these are the lessons I've learned from 2023 that I feel like set me up for success.
- Organizing your finances will set you up for success.
- Don't spend money before you have it.
- Understanding tax benefits will help you, get a good CPA.
- It takes money to make money.
- Always invest back into your business
- Making more doesn't always equate to a better lifestyle, budgeting matters.
As always, Thanks for reading, XOXO Ashley.