I have a full-time job, but I also have a small Etsy business on the side selling 10 products that makes about $200 a month. I don't see the money from this part-time work getting any bigger in the future. Should I keep a separate account for this business, or just roll it into our regular checking account?
It's very important to have a separate account, or accounts, for small businesses for two reasons. One, it's a huge help when it comes to taxes and tax season. It will also give you a much clearer picture of how your business is actually doing. Whether you're talking about revenue or tracking expenses, it will give you an easy-to-read report card.
Even if the business is small and is going to stay small, I would want to know - almost as an intellectual exercise - which of my products were winning in the marketplace. This would help you concentrate on the ones that are making you money, and allow you to focus less on the ones that aren't doing so well.
So yeah, you need to keep a separate business account, and preferably a separate checking and savings account on your business. Make sure 100 percent of the income from the business goes into those accounts, and only expenses associated with the business come out of those accounts. With really small side businesses, your checkbook register can almost become a simplified profit and loss statement.
My wife and I have had marriage problems, and a lot of them were related to money. We're working through those issues and are on Baby Step 1 of your plan. In the process, we're talking more and things are getting better. We have $40,000 in credit card debt, along with a combined income of around $70,000, so I talked to her about taking an extra job or two. She said she would rather I be at home so we can spend more time together working on our marriage. What should I do?
First and foremost, I would urge you two to begin seeing a good marriage counselor together. Money problems and fights over money are the number one cause of divorce in our country today. Continuing to deal with these issues, with the help of a good, caring counselor, will create even more communication.
I think you've both realized you're going to be in a mess if you don't address your income and money management issues. However, her concern about spending more time together and becoming closer is valid. Since you've just started the rebuilding process, maybe you could put off the extra jobs for a month or two - but no longer. That should give you both time to talk, hug on each other a lot, and start developing a solid plan together for the future!
- Dave Ramsey is CEO of Ramsey Solutions. He has authored seven best-selling books, including The Total Money Makeover. The Dave Ramsey Show is heard by more than 13 million listeners each week on 585 radio stations and multiple digital platforms. Follow Dave on the web at daveramsey.com and on Twitter at @DaveRamsey.