August 2016 Recap: Div10 Income Statement & Balance Sheet

Since I’m always on the lookout to streamline operations here at Dividend Ten, I’ve decided going forward to consolidate my dividend, income, and expenses into this here ONE report, which I thought would be both educational & fun to treat like a modified company 10k of sorts.

I will say upfront that this has been quite an anomalously odd month for me, and I ended up with some wacky numbers, and structuring it this way has given even more transparency into my activities. Anyway, without further ado, I present my:

August 2016 Income Statement

First, what is an income statement? An income statement is a financial statement that reports a company’s financial performance over a specific accounting period. Financial performance is assessed by giving a summary of how the business incurs its revenues and expenses through both operating and non-operating activities. Normally income statements are listed in values of thousands, but unfortunately since I don’t generate millions or billions of dollars, I’ve just left it at that:

Period Ending 8/31/16
Revenue
Total Revenue $8,994.77
Cost of Revenue $754.00
Gross Profit $8,240.77
Operating Expenses
Food $484.00
Shelter $0.00
Child Support $1,588.00
Student Loan $28,612.22
Gym $115.99
Medical/ Insurance $350.00
Taxes $6,800.00
Operating Income or Loss $37,950.21
Net Income -$29,709.44

Total Revenue

  • Freelance Income: $7,883.60. For some reason I lost most of my clients last month. I like to chalk it up to the summer doldrums. We’ll see.
  • Interest: $111.17 from my  1% high interest savings account at Capital One (Disclosure: This is an affiliate link. I use and recommend Cap One as they give you a $25 bonus just for signing up. Capital One has a money market account which anyone can open that pays 1% and is fully liquid with no minimums. Seriously, I’ve done a lot of research so check it out as an option and start putting your cash to work as every little bit helps)
  • Fiverr Side Hustle: $1,000 – I’m always surprised that I can pull down 4 figures on a platform like Fiverr where projects start at just $5, so this is just a little extra juice on the side. For those of you who are interested in learning more about what I do and how I do this, feel free to check me out at http://greglinginsight.com/.
  • $0 in dividend income. Seriously.
  • Gross Profit: $8,240.77

Cost of Revenue

  • Payroll: $42 I have my personal consulting business structured as an LLC taxed as an S-Corp. This provides a number of tax benefits, but also there are some things you need to take care of – like running payroll for yourself. I have just started using Gusto and I love it since they make the process of running payroll and paying contractors easy. Affiliate note: you will receive a $100 bonus by signing up through this link: Gusto $100 offer
  • Proposal Software: I’m currently paying a steep $89/ mo to a cloud-based proposal software company. It’s pretty high, but in my mind worth it, because it makes snazzy as heck proposals – one of which I won for $10k so in my mind it’s an investment that more than pays for itself, even though it’s a cloud solution I use rather infrequently.
  • Rejected check charge: $18. Wut? I am generally really good about avoiding these, but I got hit with 2 $9 fees (which I tried to get removed by calling my friends at Capital One) because I accidentally tried to withdraw from my checking account which had no cash in it. I try to keep as much cash as possible in my interest bearing accounts, so it’s important not to let stuff like this happen.
  • Subcontractors: I spent $605 on subcontractors during this time. These guys are great because I can just mark up the difference between what I pay them and what I get paid, which helps me to leverage my time. The key, however, is finding good quality talent at a decent price, which is a tough thing to do.

Gross Profit

Simply, total revenue minus cost of revenue.

This was my worst month of freelancing in 2016 from a cash flow/ gross profit perspective, and a far fall from my $52,000 haul in March. And literally nothing from dividend stocks. Note to self: should be on the lookout for dividend payers in August.

On a positive side, since I’m still trading time for money, it gave me lots of free time to unwind, sleep late, and focus on things like working out.

I guess that’s healthy. And I still feel lucky every day not to have to go back into an office.

Anyway, in my mind it’s more important to try to keep cash flow high than to find the best investments, so my goal is to use this time to actively solicit new clients get over $10,000 in gross profit next month.

Operating Expenses

Food: $484 We all need it and is generally a huge suck on your finances, especially if you love food or eating out. For me, I recently started a n diet called the Nutritarian Diet which has been fantastic. I’ve lost 6 pounds so far and have lots more energy. Health to me is an area that is a great investment, and no better way to improve your health than improve what you eat. For more information, I’d highly recommend checking out Eat to Live by Joel Fuhrman, or checking out this girl’s YouTube vlog. Only downside, is it’s jacked up my food costs a bit, due to all the organic produce, etc.

Shelter: $0 Score. Yes, I actually don’t pay rent. I moved home for a while to try to get my finances back on track. I’m looking for opportunities to move out next year, but for now am enjoying the nice savings.

Child Support: $1588 What can I say? This is for my one child & I’m divorced. This is my highest expense is legally mandated. Definitely puts a crimp in my savings rate, but it just motivates me to work even harder. After all, in my mind, while frugality is amazing and recommended, it’s always better to try to increase your income than reduce your expenses. And there are lots of opportunities I feel to do that online today, even if you already have a full-time job.

Student Loan; $28,612.22 Huzzah! So I finally bit the bullet and paid off the whole thing. This hits my income statement hard, but also removes the debt line item from my balance sheet. Anyway, I’m debt free – which is pretty awesome considering only 2 years ago I had about $90,000 worth of all kinds of debt. Honestly, the interest rate was low, so from a pure mathematical perspective you could argue it wasn’t the right move, and I am even now somewhat conflicted about it, which I wrote about here.

Gym: $115.99. I cancelled my LA Fitness membership this month, so that should save some money. However, they make you literally mail in a cancellation, and it takes a few months to go through. They really try to squeeze every dime out of your membership that they can.

Medical/ Insurance: $350. Not much to say here. Have to pay it or Obama taxes & fees will come after you big time.

Taxes: $6800. Yeah, so I am trying to catch up on paying taxes since I didn’t pay much for the first few months. So for the next few months, this is going to be really high.

Net Income

-$29,709.44

Lol. That seems pretty bad on the surface, but mostly it’s a function of paying off my student loans and catching up on taxes. So needless to say, my savings rate is negative here. Time to step it up next month!

August 2016 Balance Sheet

A balance sheet is a statement of the assets, liabilities, and capital of a business or other organization at a particular point in time, detailing the balance of income and expenditure over the preceding period.

Period Ending 8/31/16
Current Assets
Cash and Cash Equivalents $115,352.29
Long Term Investments $104,862.88
Intangible Assets $1.00
Total Current Assets $220,216.17
Current Liabilites
Student Loan $0.00
Debt $0.00
Total Current Liabilities $0.00
Net Tangible Assets $220,216.17

Cash and Cash Equivalents: $115,352.29 I currently hold a little over 50% of my current assets in cash, even after paying off my student debt. While it’s losing money to inflation, I’m not in a rush to get everything into the market here, although I am looking at some municipal bond funds for my taxable accounts to see if I can make my money work just a little bit harder than 1%.

Long Term Investments: $104,864.88 This is the value of my stock portfolio. I don’t really own any other investments at this time.

Intangible Assets: $1 I added a dollar here for my great smile. I’m sure that has to be worth something.

Current Liabilities: $0. This is the one thing my balance sheet has in common with Visa or Facebook. No debt. This is the first month I can actually say this for many years which is cool.

Final Thoughts

I actually liked the process of creating a balance sheet and income statement because it really gives me a good picture of where I am, and it helps to self-motivate to see where I might be able to improve things next month.

And speaking of improving things, I need to try to get out of the summer doldrums and get my cash flow up a bit, since it’s fallen off quite a bit.

But overall, I’m pleased with where I am and how far I’ve come in a relatively short period of time. As mentioned, just 2 years ago I was $90,000 in debt, working in corporate land, with really no assets, so it’s been a nice turnaround in a short period of time. But it’s hard pushing that income snowball down the hill to get things going, so a lot more work is required at first, so it’s important not to rest on one’s laurels and work as hard as possible. But as the asset snowball starts to grow, momentum starts to take over, so I’m looking forward to getting to that part, where things start to get a little easier.

So that’s it. What do you think of this new format? Does it work? Not work? Suggestions for improvement?

Thanks for stopping by!

6 Comments

  1. Divi Cents September 17, 2016
    • Greg Gee September 17, 2016
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    • Greg Gee September 17, 2016
  3. Brian Stephens September 17, 2016
    • Greg Gee September 17, 2016

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