S5E1: Sierra Nevada Dank Little Thing | Smart Financial Planning | Business Banking 101

Disclaimer: The information in this video does not constitute Financial Advice. Consult with a Financial Advisor before making any decisions regarding your finances.

This week, Pam and guest Francis Plata discuss "upside down budgeting." Pam explains reverse-engineering business revenue to meet personal financial needs, using wedding savings as an example, and emphasizes keeping personal and business finances separate. She also advises Francis on calculating marginal tax rates and saving for taxes.

They offer tips for starting and managing a business, including opening a separate business account and comparing banking options. Pam also covers news topics like the Summer Olympics, IRS regulations, and cybersecurity.

5 Key Lessons:
1. Pam explains how personal financial goals, such as saving for a wedding, can dictate business income targets.

2. Open a separate business account to distinguish between personal and business expenses, simplifying tax filing and enhancing clarity.

3. Calculate your marginal tax rate and save accordingly to avoid year-end tax surprises, even if you're running a side gig.

4. Consider the benefits of having a local bank relationship versus the convenience and interest rates of online banks like Relay, Sofi, Ally, and Betterment.

5. Create a business budget driven by your financial goals, meticulously track expenses, and plan for future sustainability.

📰 On this week's What's News:
1. Summer Olympics Gambling
2. IRS Updates
3. https://ezcyber.solutions/free-training

Check out EZIT For Your Cyber Security Needs: https://ezit.solutions/

Today's Brew🍺: Sierra Nevada Brewing Co. Dank Little Thing I.P.A

🍻 The P.B.K.P.I (Pam's Beer KPI) Scale ⚖️:
1. Pam's Not Touching It
2. It's Sippable
3. I'd Drink it Again if You Gave it to me
4. I'll Order it if it's on the Menu
5. I'll Seek it out

About the Brewery:
Ken Grossman, founder of Sierra Nevada, began his journey with backyard tinkering and covert science projects, leading to his

Transcript

0:00

So it's really, really cool. You want that beast that you're creating to feed you money and it you. And you'll clearly know when that's happening, because all of a sudden you're going to be having money pile up in that account, and now you can transfer it to yourself, right? And for tax purposes, that's fine. There's no issue with that because you're still a sole proprietor, but your schedule C is still going to be all in one account. Hey, I'm Pam Pryor, and this is the Cash Flow podcast. We're going to talk about everything related to money in your business. Without further ado, let's hop right in. Welcome to the Cash Flow podcast this week. I am really excited because, as you know, Francis and I continue to work with your input and with the input from our team to improve the quality of this podcast for you. We want to make it something that's very worthwhile checking into every week. And as a result, in two of the segments, we are going to alter things. A little bit of the news segment is now going to be very short, and we're going to talk on three quick topics of the week that every entrepreneur really should know about. One sort of broader economy type topic, one very specific to small business owners, and then one that is tech ish related. And we got three very hot topics for you today, so stick around for that. And then in our segment, where we are giving actual, or I'm giving some actual financial advice, we decided to frame it up so that I'm actually having a conversation with you, just like I would with a client. And Francis is going to play the part of the client. So we're going to actually do this now because we want you to walk away from that segment with a very actionable item you can take away and implement today. If you are in the same position that whatever the person is I'm interviewing or talking to that day is in in your business. So ultimately, we're going to go sort of from broader conversation to, hey, here are some very specific things you need to do if you're a serious business person trying to make a go of things. So I'm really excited about the new format. Very grateful for Francis to helping me work it out. And I look forward to diving into this segment with you to start things off, though, as always, we have our brew, and it's from Sierra Nevada brewery. So stay with us and let's taste that beer. And welcome to the brew segment of our podcast, where you can see that we have moved to a new area of the house, which makes a lot of sense, because this is where the beer is. So now I can get it much more easily. And it's cold when I try it. Today, we're going to taste a beer from Sierra Nevada, which is a brewery we've had on the show before. Done on the show before. Just as a reminder, Ken Grossman is the guy who founded this, and he got cool little fact, his very first beer kit in 1969, my decade, by the way, when he was just a teenager. And since then, he's been brewing beer and studying beer. So, you know, you're going to get one that's very well studied. This is not just somebody fly by night who's thrown a brewery up. He opened his first brewery, his first Sierra Nevada brewery in 1980 in California. And now there are two main locations that you can visit. One in California, just north of San Francisco, and in place called Chico, California. It's up in the forests in California and kind of the middle of the state. And then one in Mills River, North Carolina, just south of one of my very favorite places in the world, Asheville, North Carolina. So you can be sure we'll visit down there. So how about we give this one a try? Let me show you what we've picked for today. All right. Sierra Nevada. Dank little thing. Hazy. I p a. So let's see what we're talking about here. Okay, so the hops for this beer are amarillo, chinook, and CTZ, as in zebra. And the theory is that it gives a sticky, floral, tropical hop taste. I don't know what a sticky taste is, but we'll find out. And these particular varieties also provide what they call a resinous flavor. So we're going to take a taste at this, but the IBU on this beer is 40. And just to give some context, around Ibu, Ibu ranges from zero to 120. And it's a bitterness level for the hop. It doesn't always mean, like I've said before, that that's how bitter the beer is going to be, but it is sort of a gauge for how bitter things are. Here's your fact for the week. Human taste can't actually detect anything above 100. So if you see an IBU of higher than 100, it's probably more marketing than real, just for the record. So we've got 40 here, and I'm going to dive in. And just the IBU on this, which you'll remember is the alcohol content is 7.5%, so relatively high. Abu not massive, but relatively high Abu. And here we are. I also learned another little fact. You rinse your glass before you pour. I'm going to research the why on that and cover that with you next time. But let's see how we do here. All right. Get about halfway up. And I also learned you want to generally get about an inch of headland, which we'll see if I actually achieve that too far. It's a little bit more than an inch, but we're going to show the failure because, oh, boy, is Deb going to get mad at that. So I. Here's what happened there, just so you know. Might as well share that, because I've been studying on beer pouring as well. I switched from pouring against the side of the beer to just pouring into the middle too quickly, and I was pouring too fast. I think I was just kind of rushing because the beer smells so good. But let's get to the important part here, which is the tasting. Thank you, Francis. So what happened there on the pour? Got to clean up a little bit here, is that I did two things wrong. One, I poured. I switched from pouring against the side of the glass with the tip to pouring from the middle too quickly. A little bit too quickly. I needed to wait for probably about two thirds to be poured already. And then I. I poured too fast after I took it off the edge of the glass. So that's how you can get a little bit too high of a head. Generally, you're looking for somewhere around half an inch to an inch in the head on your beer. So let's talk about how this smells. Oh, God, it smells so good. And it, interestingly does have a little bit of a floral to it. They also describe the. Describe this as filling up the room with aroma, and I have to agree on that. It's got a nice floral, gentle smell to it. I have no, it doesn't give any hint that I'm going to be hopping into this and getting a very bitter taste. So let's see what we got here. Oh, God, that's good. That is really good. So it's good. And it's kind of complicated. So I definitely get the floral right off the bat. But it's not like a sweet, ugly floral. It's a pretty gentle floral. And then it goes into this very pineapple ii taste, although I didn't see anything in there about pineapple. And then it hits the bitters, which is really cool because you get the good ipa taste on your mouth. Again, if you're not an IPA drinker, probably won't love this one, but boy, it rolls in really nice and smoothly. It's almost like a wave. You first get the little bit of a sweet, and then you get a tropical pineapple y thing, which is also a little sweet. But then it rolls right into the bitterness of an IPA that you're really hoping to get. Not horribly bitter, actually. Very, very good. So on our PBKBI indicator, which is where I give it a key performance indicator of one to five, all those descriptions are below what each one of those means. This one is a a good three for me. I would order it, I'd enjoy it. I'd have it with some foods. I'd have it on a nice summer day out on the deck. Very, very good beer. Three is good. It doesn't mean it's bad. Three means it's really good. But four and five are highly special. Like I'm going to hunt them down. Very good beer. The bitterness lasts a little longer than I like and it goes back, way into the back of your throat, back of your tongue. So that's the only thing about this that I would say I might change and that might actually go away with a couple of sips. But either way, that's a good beer. Cheers. And let's roll right into our news segment, our newly formatted news segment, which I think you're going to love. See you there. And welcome to our news segment, where we are, as I mentioned, going to be talking about a broad topic, a narrow topic and a tech topic. And hang for the tech topic because it's really important. I posted something on Facebook on this. It is a danger to every single individual out there, and there is a tool that we're going to provide in the notes for you to be able to protect yourself. So hang around for that. But first, a couple of broad topics. The first thing I want to talk about is the Summer Olympics. They're coming up and for the very first time, we have legalized gambling in the United States for sports betting. And now I think it's 30 out of the 50 states have legalized gambling. So it's going to be very interesting to watch the impact on the Olympics this summer. And I'm very curious whether viewership goes up or not. The couple of main players are draft kings and I think it's called Van Duel. There are a few others out there, but keep an eye out. I'll bet you viewership on the Olympics goes up a lot, because now every single one of those events are going to be something you don't have to go to Las Vegas or Atlantic City to bet on or even into a physical location to do sports betting. You're going, people are. And just for the record, this is now all mobile like. You can download fanduel and you can download sports KING on your phone. So it's going to be very interesting to see what that does to viewership and what it does to the success and profitability of those two companies. So that's something on the macro level that I am keeping an eye on, and I will keep you posted. Now, betting and gambling is a risk. Do not do it unless you can lose and intend to lose everything you put on the table. That's just a disclaimer I want to put there. I'm not advocating for sports gambling. It's just an interesting sort of economic effect that I think we're going to see on the Olympics. Our second news piece is a little more important for small business owners. Now, what probably, you know, is that back about a year and a half, two years ago, people started trying to take what was called an ERC credit, which was a filing with the IR's, to still take advantage of some post pandemic money that was available to businesses. Here's the scoop. The IR's is doubling down on cracking down on these. So there were a lot of scam artists out there. You probably got a lot of calls from people saying, hey, I can get you $30,000 if you have four employees. Give us your paperwork and we'll take court care of it for you for a small, small fee. And for a while, these were just getting processed. Boom, boom, boom, boom, boom. But the IR's has basically slammed the brakes on it, and they're splitting these claims now into two different piles, the high risk piles that they're likely going to deny and the low risk piles that they think are legitimate. Now, nobody ever broke any rules like it wasn't illegal to do what those, those folks were doing. But if you are someone who has put in what's called an ERC claim, you will know you're one of those people because you either have already received a big check from the government or you're about to. If you're in the about to pile, it may take a little bit longer. We're going to drop a link here in the podcast notes so that you can check on the story there, because it's very important to follow that if you have built that money into any kind of a forecast for cash flow, and then finally, on the tech front and this is the big story today. I had posted in Facebook. You may have seen it there, but there were something like ten to 20 billion passwords that were leaked and posted on the dark web this past, I guess, about a week and a half ago. Now, that's a big deal. That is the most that have ever been leaked on the web, and it's dangerous. So I want to do two things here. We're going to provide a link for you in the podcast notes as well. Our own it provider called easy it solutions has provided this link for us because I asked them to make it available to our listeners. You can click on there and get a sense of your exposure or if you're at risk. And I just think that's an amazing opportunity, and I'm very grateful to Travis and Cody for giving that to us. But here's what's happened. Over whatever period of time, somebody has managed to gather up 10 billion or more hacked passwords, and these have now been put on a spot where all the bad guys on the black web need to go get them. So if you are one of those people who have used a password over and over and over again for the same thing. Guilty. Change it. Even I, who am the biggest grump whatsoever about passwords, have bought myself a password tool to keep my passwords in. They're no longer on a spreadsheet. It's called bit warden, and that's actually what this link is going to lead you to. And I'm not an affiliate, so don't think I'm trying to make money on this. We're just dropping you a link so you can get a look at this thing. It's a free password protector and it's really good. We've been using it now for three years. Very easy to use. You can share passwords with people you want to share them with, but it keeps them safe and secure. It has not had any of the breaches that want not one password. Lastpass has had. Remember, Lastpass actually got breached and law, and if you don't know this and you're on Lastpass, you need to get out of there. They've been breached multiple times and all of their passwords have been exposed. Or not all but a good number have been exposed. Bitwarden is built a whole different way, very easy to use and something you're probably interested in looking at. Separate from that, even. I now use the random password generator, and I know it's a pain in the neck, but it's a little bit less of the pain in the neck than it used to be, because now, on every machine, I have the same password, sort of. What's the word I'm looking for here? It's a vault password. Vault. And so whether I'm on my computer or one of my two or three computers or I'm on my phone or I'm on my iPad, that bit warden vault is there. And it's so easy. It preloads my login id, and it preloads my password right into the blanks when I need to log into something. And I, in particular, if you watch this show, you know that a little bit ago, I had a bank account fraud on my checking account and lost $10,000 that I'm never going to get back. So I randomly generate every password now, and bit warden makes that very easy to do. So, whether it's bit warden or one password, please don't use lastpass. That's dangerous. But bitwarden, one password, and I'm sure there are other password vaults out there. Definitely do it. 10 billion passwords have been leaked. Okay, so that's ten with 123-12-3123 zeros on it. That is a lot of passwords. Very good chance one of yours is in that leak and take the time to do this. That's all I have to say. I cut that out. That looks stupid, but let's go. If there's one thing I can beg of you in this news segment, please take care of your passwords. Don't get hacked for ten grand like I did, and use the random password generator. It is not a pain in the neck anymore to use. That's it for the news segment, and I look forward to chatting with our guest today in the we haven't yet know what to call it segment, but we're gonna give you a very actionable step you can take as a business owner to move things forward for you as it relates to your finances. Stay tuned for our next segment. We're gonna talk to Francis about his brand new business and something very specific he and every entrepreneur needs to do early on in their business when it comes to their money and cash. All right, so, welcome. I have in the studio today Francis, who is my producer, but is also a business owner. And because I happen to see my card deck here, I'm going to actually do a card trick first. Let's see it, because this will be fun. Before we talk about a particular question you have in the business. Okay, you ready? Yes, ma'am. Pick a card, any card. All right. Okay. Show the people okay. Okay. All right. Pop it there. Boom. And I have not seen it, I promise. Now cut that deck any way you want to. Boom. Back on. Well, I can put it on. You can put on. Doesn't matter. There we go. All right, so now maybe use this camera so you can edit this in. Okay. To film me turning the cards over right there on my very. But I won't do it on my busy computer. We'll do it right here. All right. Boom, boom, boom, boom, boom, boom, boom, boom, boom, boom, boom. Whoops. Boom, boom, boom, boom, boom, boom, boom, boom, boom, boom. Bet you the next card I turn over is yours. We'll see. How about you? That is my card. There we go. That's it. You're welcome. You're gonna have to tell me how you did that. I can't do that. A magician can't give away their tricks. Ah. But I'm just gonna. I'm gonna obsess about that now. But there's a reason I did that. Okay. People think that finances and their business is magic and that they're never gonna freaking get it. Yeah. I will tell you about finance stuff. So let's jump in and hear what your question is. Welcome. First of all, thanks for coming. I'm so glad. First of all, Francis had the idea for this segment, and I think it's brilliant, and I can't wait to jump in. So tell me about a little bit about your business and what your question is. So, as you know, I've been kind of working on the side and doing a little bit of a side venture here where my goal is to support businesses in the way that I've kind of helped us build up a little bit of a software. Speaking of support, I got our staff in here as well. But to support businesses with implementing and optimizing processes. Right. Using artificial intelligence the way that we have in the business. Which is why you're our go to for AI. Exactly. But, you know, one of the things, as any starting off business owner may know, like Diego, is, you know, where. When do you switch from that point of it just being a side venture or a side hustle or a hobby into it, fully becoming a business, you know, I'm taking clients here and there, and I'm working just on projects every once in a while, while Murphy chews on the lights over there. Your stuff is, like, not helping at all. We gotta fire them all. Yeah, everyone's getting fired, but, you know. Just going back to that, you know, taking on clients and doing side projects here and there, when do I, when does it become a business? When does this become a business, and when do I need to start treating the business finances like a business? That is a very, very, very common question. So let me ask you a couple questions. Yeah. So are you right now, do you, are you just kind of doing this when you spend money out of your checking account and when people, your personal checking account, when people pay you, it's coming into your personal account. So you're what we call right now a sole proprietorship. Okay. That means you kind of haven't registered with the state and said, hey, I'm a business and I'm going to be doing ABCDE, and that's totally fine. I think a lot of people think that because of the finances and the taxes, they have to automatically create an LLC in the business that you're in. The determination of when to create an LLC once you're way down the road, there's some financial reasons to do it, but early on, it's really a liability decision. So say that you're doing AI for a customer, and if there's a high probability that in your work you could do something wrong and they would want to sue you, then you definitely want to get an LLC. Now, if you're really helping people do some things that aren't going to cause them to say, hey, I'm suing you because you lost all my customers for me, then you can stay a sole proprietorship and still do what I'm going to suggest you do for your finances. So we definitely, you have decided at this point. Second question. That this is going to be a business for you, or are you like, ah, it's always going to be a side hustle? No, I've decided that this is something I'm passionate about pursuing. Perfect. Okay. So even if you decided I want to do this, but I don't want the hassle of setting up an LLC. There's something very specific I want you to go do tomorrow. Okay. And then you can report back to me on Friday that you've done it. Tomorrow is Friday. You can report back to me. Well, actually, this is playing on Tuesday, so you have three days. All right, there we go. I want you to go open a separate checking account. Now, they won't let you open a business account because you don't have an LLC. That's fine, but open a separate checking account, a lot of times what trips people up in this particular area is, hey, I need that money to spend on my life. Right. It's not like it's, I have. I can put it in a business and leave it there. But that's okay because you can still pass money back and forth between the business. We're calling it a business account. It's not really a business account. It's just another checking account. We can pass money back and forth between that account and your account when you need it to buy food. Yeah. Don't a lot of people, I think, assume that, oh, my God, if I set up a business checking account, I can't ever use that money. And that's just not true. So here are the steps we're going to take. Number one, you're going to go to a bank. Whatever bank you want. Very cool. And I think maybe we should drop a link in here. There's a new bank that I'm very fond of. It's all online and it's called relay. Relay. Now, I think you might have to have a business account, but cut that part out. Okay? Cut that part out. So what you want to do is go to whatever bank you're with today. It's probably easiest. And open a second account. And it could still be a second personal account. You can call it anything you want, but in your mind, it's going to be your business account. Gotcha. And what I want you to do, the first step, is just have every dollar of money you make in your business get deposited there instead of your account. And there's a big reason for this right now when it's kind of all blended in, it's a hobby, right? You're spending money on it. You might be making some money, you might be spending some money, but it's really being kind of treated as a hobby, when the truth of the matter is, because you've made the decision that this is a business, it's time to say, oh, my God, this is actually a thing that I'm going to put money in and it's going to make money. Diego, I love you, buddy. He's like, listen to this, Francis, listen. She's telling you it's going to make money. And initially, probably with most businesses, you're going to spend more than you make, right? So you want to separate it for one big reason, and that is you want to know how much you're putting into it. It can get buried in your personal checking account, and you'll never really know if you're making money in your business. And I think this is a very common problem for entrepreneurs. They really don't know, am I making money or not? So if you separate it out, have all the income come into that account. And when you pay bills for things like when you have to buy a software or when you have to buy, you know, I don't know, pens, who knows what? Or you have to travel somewhere, spend it out of that account. Gotcha. Okay. Now there's going to be a period of time where there will. One of two things are going to happen. You're not going to have enough money in that account to pay for your expenses. And if that's the case, it's okay. Transfer money in and still pay out of that account. Right? So if it's one of those things where you're like, I need to spend $400 for a plane ticket, I only have $200 in that account. You're going to go anyway. Instead of writing that check out of your personal account, transfer some money over there and write it out of there. That's what's called. You're setting yourself up for what's called an owner investment. Gotcha. You're investing in that company to be able to spend that money. So that's one thing. The second thing that can happen is you don't have enough money to put food on the table, right? And if that's the case, transfer money from the business into your personal account to buy food. The rule of thumb here is if you're collecting money or spending money for the business, make sure you put enough money in that account from wherever. Let me back up with that. The rule of thumb is any income for your business and any expenses for your business, you're going to do out of the new quote unquote business account we've set up, and any personal stuff you're going to do out of your personal account. Gotcha. Add one little step. If you need money in your personal account that you don't have, you'll transfer it from your business account before you spend it personally. And if you need money in your business that you don't have, you're going to transfer it from your personal account before you spend it. And what that does is it creates a very clean account where all of your income and expenses are and a very clean account where all of your personal expenses are. So you can still do your personal budget process with your fiance every month. And it's looking just at your personal stuff. It's so nice to keep that clean and not have to say, oh, oh, ignore this, Kya. It has to do with the business. No, everything here is personal. And then two very cool advantages that come out of the business side is number one, when it comes time to do your taxes, it's very clear how much you made in the business. It is your schedule C that has to be filed. Gotcha. Right. You don't have to go, oh, my God, I gotta look at every single personal bank statement, highlight all the business, and people do this, and sometimes it turns them off from entrepreneurship. I'm like, no, this is so easy to fix. I've done that a few times through contracting work where you have to go through and just like, this was a business expense. Yeah. And that is one of the things, like, literally, honestly, just like you were saying, it stressed me out to the point where I was like, okay, I don't want to ever do this again. Right. I don't want to ever do contracted work again. I don't want to ever do entrepreneurial work again because of the stress that came with that. And you're not just a pressure of. Like, you know, if I mess my taxes up, the IR's is the biggest monster. They always get you. They all would. They IR's always wins. Death and taxes you can count on. And, yeah, so that's the very cool thing about it. But I will tell you now as your CFO, because I am, by default, your CFO, you lucky bugger. It also sets you up. To have history. And to be able to tell the story of your business from the beginning is so much fun. Like, you know, when we talk about the financials and priorities, I'm able to show you, hey, here's what we've been doing over the years because I separated it early. And so I think the main points to take away from this and highlighter number one, you don't have to create an LLC just to keep track of your finances separately. Yeah. Just set up a new personal account. Number two, go ahead and make sure all of your income and expense for the business is here. All of your income and expense for the personal is here. Gotcha. And you end up saving yourself so many hassles down the road. And here's the really cool part. When that business starts to pay for itself and you don't have to transfer money into it anymore, all of a sudden, the thing you've been putting money into forever, it takes on a real life of its own, and it's now feeding you money. And you see that so clearly. And that is, like, one of the main points on the entrepreneurial journey. That gives you fuel to keep going. Yeah. And if you bury it all, you never know that happened. Right. That's really interesting. So it's really, really cool. You want that beast that you're creating to feed you money and it. And you'll clearly know when that's happening, because all of a sudden you're going to be having money pile up in that account, and now you can transfer it to yourself. Right. And for tax purposes, that's fine. There's no issue with that because you're still a sole proprietor, but your schedule C is still going to be all in one account. You'll never have to look at a bank statement to, like, highlight stuff. You just know if I dump all the transactions from the year, that's all business. Hand it to your I tax accountant or drop it into turbotax, and it'll automatically populate schedule C. That's awesome. Yeah. So I guess there's two questions that came to mind while you were kind of running through that. Right. Question one would be going back to, like, the first step, right. Going out and opening a bank account. Which you're going to do by the end of the week. Yeah. Okay. By the end of the week, next three days. But the question would be, right, you know, we have a brick and mortar bank, and we have an online bank that we're using right now. Great point. Which would be the better one? Do we want to look at interest rate mainly, or do we want to look at certain factors? Are there any factors that we should be aware of when we're choosing our bank for this? A lot of people are wrestling with that very same thing. And there's two schools of thought, and I'm actually working on that question myself. And for me, I am moving to a fully online bank. But if you have a great relationship with a banker at your local bank, then physical brick and mortar bank, I would take advantage of that. Because as you evolve and you do set up your LLC and you do set up your business accounts, having that human person there, like, for example, when I had that fraud, having a human at the bank, even though the bank made me furious, he didn't, right? Because I could go into him and say, jerry, I'm dying here. You gotta help me. And he helped me, right? He helped me navigate the maze of shit that is our big banks. So if you got somebody you know, and it's right down the street, very cool to do it. The reality is, to do business in today's world, you do not need it. Okay. I am a person who hates getting on the phone, who hates, like, going to the bank. So I like it that I can do everything online that there's a chat bot there that, you know, I can pretty much bank the online banks, to be fair, still have banking hours. Like, you're not going to get a chat person on the bank at midnight necessarily yet at all the online banks, but you can do everything you need to do as a business person online. And there are a couple of really good banks online right now that. The three that I'm aware of, or two that I'm aware of, one is relay. That one I really, really like. The thing I don't know about relay is if it'll let you set up a business account before you have like an LLC or you filed for a, you know, an official business name. They might, though. It's worth checking. The other one is, I always forget the name. You're gonna have to edit this pause out. Is it Sofi and Ally? Because those are the three that I really know of. No, but good. That's two more, Sofi and Ally. I would check with them. There is a bank called betterment that also does this, but it's more of an investment bank. On your question about interest rates, at this point in your business where you're just starting off, it's not like you're generating enough cash that you're going to make a fortune on it. And it's not like it's going to be sitting around, right. Pretty much starting businesses, you're hurling cash out the door as soon as it comes in. And if that's the case, then interest rates. Now, if when you start, when you start to pile up cash in your business or personally, then you definitely shop interest rates. The cool thing is, for the most part, they stay in lockstep like discover and capital and betterment. Capital one and betterment. They all. All of a sudden, you were getting 5% interest on your savings accounts last year when interest rates skyrocketed. And when one goes, they all go, because everybody started moving all their money out of the Wells Fargos and the chases. And so I go, shit, we can catch up. So that I wouldn't worry about. But at this juncture, it's your personality. Gotcha. Unless you have a good local relationship. Good to know. That's really good to know. That answers perfectly. And then I guess my second question was, was you'd mentioned kind of how we manage our personal budget, right? Yeah. And the way that we manage to, in case listeners aren't aware, is, you know, we'll basically go through weekly and itemize what we're spending in certain categories, and then monthly we meet with you and we run through and make sure that that's all on track. We're going to hit the goals that we want to hit or we look. For adjustments that we make. Oh, we bought a car. We need to do this. Exactly. Yeah. So would you want to take that same approach with your business bank account? Would you want to go through your business bank account weekly and itemize this and then go through monthly and kind of look at everything? Yes. So now you and Kaia both have a personality. I love for business. Some people don't want to do that, and that's totally okay. Every entrepreneur is different. Yeah. But if you've got a mindset for this, which clearly you do. Yes. And it's exactly the same thing we built for you personally. Gotcha. Exactly. It'll look, it's the same spreadsheet. Yeah. It's the same thought process. Now, the only thing is you might not have the frequency. Like if you have one or two clients a month and one or two expenses a month, maybe you look at it monthly, but as it starts to get bigger and bigger. Yeah, you want to look at it, because what you want to know as a starting business owner is, can I invest in this thing? Like for you, maybe there's an AI conference you want to go to. So we want to know, well, I have enough money in three months to go to that business conference. And you can make a few assumptions about, well, I generally get about a client a month and they pay me somewhere between X and. Yeah, so you can kind of put that on the budget and know, oh, yeah, by then I'll have the money to do that. So I will go ahead and plan to go, which is another really important thing about separating the finances. You just really hit on a very big thing. I wasn't even going to jump into that, but I am a proponent of forecasting and for that reason, because you can play with it, you can go, oh, I can't go to that one, but I can go to this one. And maybe instead of that, I'm going to do a Facebook ad or whatever your choices might be. And doing it this way, it seems like it allows us to set more realistic goals and kind of continue to achieve those goals and take the next steps in the right direction. Bingo. It's definitely a link up to your, you should never start a business. Not, I should not say should. Generally when people start businesses, they have goals for them. They want them to support their lifestyle or an investment or retirement or, and regardless of what those goals are, you can't track them. They're usually financial, and you can't track them unless you're budgeting and forecasting and then seeing whether you're meeting them or not. So, yeah, great. Great. That's interesting. With goals, like, just a question about your approach. Do you normally approach personal and business goals financially the same way, or do you approach them in different. With different mindsets? I go at things a little bit backwards, and it's how I do it with my clients. I find out what their personal backwards. Doesn'T mean bad, though. No, backward. I actually call it upside down budgeting in the business, because in your case, what I do is say, okay, here's your budget, your personal budget. And you have some goals financially that you want to save money for. Yeah. So what I would say is our personal money right now with w two s and all that stuff makes, I'm just gonna use an arbitrary number. I'm gonna make it ridiculous just because I don't want anybody to know. Your thing would say that, you know, you have literally, you know, $5 left over every month. Yeah. And you know that you want to, I don't know, get married. Like, you got a wedding coming up. Yeah. And you know, you want to spend, you know, $15,000, $30,000 on that wedding. What you've just determined is, oh, that's the, I don't want to borrow it. I don't want to go credit cards. I want to make that much money in my business. So what we do is we take that $30,000, and we go back over to the business forecast, and we sAy, okay, we know we want the bottom line to be $30,000. GOTCHA. And then we back up, we say, okay, I know I have these expenses in the business, so I need to make a little more than 30 because I have to make, you know, enough to pay those expenses. So say that number comes up to 40,000. I need to make $40,000 in a year. Now you got something to work towards, right? So you start with your personal goals, and you then say, okay, what do I need my business to do? And that drives a whole different set of questions, right. If you start with a blank slate and you just say, okay, let's see, if I make this revenue and spend this money, I get this much left over. Okay. Why? But what this does is, I know I need 40,000 leftover, 30,000 leftover. So I know I'm going to spend this 10,000 in the business. So I need to make $40,000. Yeah. And then it forces you to go, okay, I have six of this kind of client and two of this kind of client shit. I need to ramp up and do more gigs, or I need to raise my prices or I need to spend less on things. It lets you get all those business levers and play with them. And your business levers are things like your price, how many clients you have, how much you spend on advertising, all who you hire, your staff, all of that stuff. So I love the way you're thinking about that. They're totally integrated, and I think a lot of entrepreneurs don't realize that till further down the line when either their business is or isn't making the money that they originally thought thought it would without really putting numbers around it. Interesting. That's really interesting. And that's good to know. And, like, the mindset behind that and working in that way. Yeah, it makes total sense. You know what I mean? Because then you're not stressing about, you know, the specifics as to what's supporting what in your life. That nails it. Yeah. Because that will stop so many people. Just the confusion there. And it's as easy as this first step you're going to take. And I encourage all of you, if you haven't done this yet, I, if you've got a side hustle, go ahead and do this. Set up another personal account. Don't worry about the LLC. I mean, we can go through a whole segment on doing that, but just get it set up, get it separated. Once you do that, I cannot explain to you all of the positive repercussions that's going to have even further down the line over and above the ones we've talked about today. Gotcha. So that's all really, really helpful. I guess there was one more question just before we hop off, and I don't want to dive fully into this topic, because it is a big topic that we can probably cover on a full episode by itself. Okay. But just going into this, and as I'm starting to build out my weekly and monthly budget with the business account specifically, and after I open up a business account, right. Prepping and preparing and figuring out how much I should be putting aside from each client for taxes, what's your mindset, and what kind of approach would you take with this, since I'm. I'm at the point now, luckily, where I can start and do that right from the get go. I'm so glad you asked this, because this is, you know, every, almost every business that starts up, loses money in the first year or so. And so often we don't think about taxes because we don't have to. It's actually going to be a deduction for us. Right. But if with you and I know you well enough to know you'll be profitable in the first year, fingers crossed, you really need to be aware of that. So taxes is the biggest expense we don't pay attention to. Yeah, and it's often the biggest expense on our books. However, people overreact to it. The taxes you're going to have to pay are not going to be on the money you bring in the door. It's going to be on the money you bring in the door, minus your expenses. So this is another really good reason to have a budget. So let's take the example we were using. If you're going to have 40,000 in revenue, 10,000 expenses, you're going to have net income of 30,000. You want to find what your marginal tax rate is, and that's a whole nother discussion for a long day. But you can look at it very easily on the Internet. What is my marginal tax rate? And they'll tell you exactly how to calculate it. Gotcha. And say that comes up to 18%. You want to make sure you've put aside 18% of that net income number. Now I want to walk through that again very slowly. Yeah. You have your revenue. I'm going to make 40,000. I'm going to spend 10,000. I'm going to get taxed on what's left. 40 minus ten is 30. Got you. So you want to put aside in the case, our example, 18% of that 30,000. So you'll put aside something like, you know, $600. Gotcha. And save it. Put it away out of your checking. You know, open a third account and put it over there. And then there is a whole other conversation to have around estimated taxes. But I, for now, you know, especially for folks, because when you're doing a side gig, it really does feel kind of like you're a freelancer. Yeah. And freelancers get paid and it's great. And then they get to the end of the year and it's like, oh, crap. Yep. I have profit, but I don't have any cash left. And that, that can be a bit of a bummer. Awesome. Well, that's really, really helpful. So just. Can you take me back? I guess the three, those three. Each of those three things like. Yep. Generals. Yeah. Great point. So let's recap. Yeah. Here are the three things I would do in this order. Number one, open up that second bank account. It can be personal, but open up. Little tip. Open it where you have your personal bank account. Cause it makes it easier. And then only spend related to the business out of the second account. And only bring your income into the second account. Keep all your personal stuff on the personal side. Gotcha. Second thing you can do is take the same process you did to create a personal budget. Create a business budget. You know now what you want it to do for you, because we've determined you want to get married. Yeah. So we want to take that $30,000 we want. Great wedding, by the way. From the sounds of it, you want to say, I'm kidding. He has not told me how much he's going to spend on his wedding. I made up 30,000. You take that $30,000, you're going to say, that's what I need to make in my business. You're going to build your budget there. Third thing, taxes. Third thing is taxes. How could I forget taxes? The third thing is taxes. Take how much money people are going to pay you. Subtract how much money you're going to spend in your business. What's left is going to get taxed. You need to find your marginal tax rate, which you're going to Google. You may even drop a link for it in here because that's Francis for you. You're going to find out what your marginal tax rate is, whatever that 40 minus ten equals 30 is, multiply it by that tax rate, and in our case, then we'll put aside, you know, some $600. Gotcha. And you'll. Or six. I can't do math in my head. Normally, you're pretty good. 30,000. You're gonna do 18% of 30,000. Like $6,000. Gotcha. There we go. So that's easily. Let me do that again. Oh, and I may have, in the middle of that said 600, too. I did do not do math in my head. I tell every potential client, this is a CFO who does not do math in her head. And the worst part is the place I screw up is zeros, which is not a good place to screw up, but that's why we have calculators and paper. So what you want to do is take how much money people are going to pay you, minus how much you're going to spend. Whatever's left, in our example, 30,000. Multiply that by your marginal tax rate and I'm sure. Francis will drop a link to where you can find that here. And so let's say it's 20% just for ease of math here, since I don't do math in my head, if that number, if you're left with $30,000, you're going to need to have 6000 put aside. Gotcha. Okay. New bank account. Number one, budget in your business. Number two, put aside the money for taxes. Number three. Awesome. So next time I talk to you, you're going to have set up that bank account, and I was very excited about that. So, Fred, thank you. I love this format. Thank you for thinking of it. And folks, Francis will play a number of roles. We're not just going to talk about starting businesses and side hustles. We're also going to talk about everything up to eight figure businesses that are ready to sell, because we have clients along that whole spectrum with a whole bunch of questions that are very common across the spectrum. So regardless of where you are in your business, stick with us and we're going to have very practical, practicable, practical, actionable tips like this for you no matter where you are in your business. Thanks for joining us, Francis, thanks for your questions. I really wish you the best with your business. You know that I'm 100% behind what you're doing and the world needs you. So I'm excited to see you get out there and do this. I'm excited. Thanks for having me. I'm excited to dive into some more topics over this season. Cool. Good deal. Awesome. All right, folks, we will see you next week on cash flow for another round of brews news and whatever we're going to call this segment. Have a great week. Thanks so much for watching the Cash Flow podcast with us. We want to bring more and more of this to you. Please like share, subscribe, comment so that we can keep bringing more of this content to.