Speaker (real estate professional) urges running monthly financials as essential for a real business, recommends using a proper chart of accounts and hiring a QuickBooks-certified bookkeeper to maintain accurate books; advises mapping revenues (4000s), cost of sales (5000s) and using consistent account numbers, and says lightweight tools (e.g., 'biz tracker') cannot replace QuickBooks-backed monthly financials.
I almost want to do a poll of you guys to find out how many of you are actually running monthly financials. It's a small percentage. It's minute in the real estate industry. And it's. I wish more people did it. Here it is like the number one first thing you gotta do in the financial part is you have to run monthly financials. And the bottom line is that you're not gonna have a real business until you do this. And like I was saying when we started, it is like the only score that matters. It's the one thing that we can all come together and say, hey, how'd your business do? Like, well, I don't know. It's May, and I haven't done my financials for. For 2015 yet. You know, I say that because I know there are some of you on this call that might be operating in that world. You just gotta make a decision on how you want your chart of accounts to look. And I'm not gonna go through this in detail, but any bookkeeper will be able to take this. And someone made the comment that their chart of accounts isn't set up in a way that's useful. This chart of accounts is set up that way. So it's like Keller Williams has a streamline Business solutions, which I've heard mixed reviews on, honestly. But any bookkeeper can take the chart of accounts there and you can tweak them just so you can understand them. Okay, so you want revenues, cost of sales, both broken down by list and buy, and all your operating expenses, your listing, I mean, your marketing, your advertising, your technology, all your overhead, your general administrative. It's just. It's not that complicated. You just got to give that chart of accounts, go on Craigslist and interview three QuickBooks certified bookkeepers. So if you're not running monthly financials and you're on this call right now, that is like a number one multiplier project is that you have to be producing monthly financials. I started this back in 2008. You know, I was new. It was my first full year in real estate, and I was doing monthly financials because I just knew I needed to know the score. I was making money and spending money, and I had a business background. And I'm like, well, what do businesses do when they make money and spend money? They got to keep track of it. So this is just a bare minimum requirement. So if you're not running monthly financials, you're on this call. You need to stop everything right after this and grab that chart of Accounts. That Excel document, open it up, print it out, look at it, cross out the stuff that doesn't make sense for you. You can go into more detail or less detail. The whole point is that there are categories, and it's just number ranges. So when you're working with your bookkeeper on a regular basis and they ask you, hey, I'm not sure where to put this. You have that chart of accounts printed out, and you can say, put it in 5515. Like, okay, cool, 5515. You know, all your revenues are 4000 series. Your cost of sales are 5000. So 4010 is listing commission for us. 4020 is buyer commission. 4030 is listing transaction fee. So I track my transaction fee separate than my commission income. And it is way easier than it seems. Even if you're like, the financial idiot, you just have to have that chart of accounts and find a QuickBooks certified bookkeeper. Okay. Oh, Ryan asked. I'm so glad you asked that question. So Ryan asked the question. He said, why isn't your biz tracker good enough for monthly financials? So you don't want to be the person. I don't care what size you are. Like I said, I started this in 2008. 2008 was the year that I did, I think, like, 44 transactions. You. You have to have someone put your books together, load them into QuickBooks. You have to run your business on QuickBooks. It's a bare requirement. The report that your bookkeeper gives you that data goes into the biz tracker, but you're not using, like, you could have 100 transactions in a month. And who's going to go through those transactions and organize them into the chart of accounts? That's what a bookkeeper does. I mean, I have a ton of transactions going through my real estate business, and it's like 200 bucks a month. I pay my bookkeeper for, like, a lot of transactions based on number of transactions and how long it takes them. Essentially anywhere from 25 to $50 an hour. Most bookkeepers will charge. And it's really how efficient they are. Mine's pretty efficient, so it doesn't take her that long. So, no, definitely. Biztracker does not replace monthly financials.
