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Budgets And Taxes For Your Small Business With Christy Bowie

 

Attention all small business owners! Are you tired of unexpected expenses that are keeping your business from thriving? Today on The Legalpreneur Podcast, Christy Bowie joins us to discuss budgets and taxes for your small business. Christy is the host of The CEO Wingwoman and is TikTok famous for her expert advice on how to financially plan your 7 figure business!

You can make all the money in the world but without proper management, you will struggle to maintain the cash flow necessary to sustain your business. Every CEO needs to partner with a trusted CPA who can help you plan for financial success!

In this episode, Christy will change the way you think about budgeting by shifting your mindset to spending planning. Your earning potential is unlimited and by reverse budgeting, you can structure a financial plan that supports your wants and needs without any surprises. 

If you want to learn how to master your budget, listen now!

 

Key Takeaways:

[1:15] Accounting and Taxes are like a puzzle for legally keeping your money

[3:20] Creating a holistic luxury financial advising firm for small businesses 

[6:00] Getting clients from TikTok because your network dries up faster than you think

[7:15] How you file your taxes impacts everything that you do

[9:50] Your authentic personality and brand is ultimately what attracts clients on TikTok

[11:20] Different strategies for attracting appropriate clients 

[12:10] Controlling your platform by moderating your comments on TikTok

[15:00] Taking constructive criticism and feedback from potential clients in your comments 

[16:00] How Christy helps your business as a fractional CFO

[19:00] Understanding the difference between profit and available cash flow

[21:30] Shifting from a budget to spending planning 

 

To learn more about Christy,  click on the links below:

TikTok

ChristyBowie.com

Instagram

The CEO Wingwoman Podcast

 

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Links: 

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Legalpreneur Instagram
Website 

Facebook
Twitter 
TikTok
YouTube

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Disclaimer: 

The Legalpreneur Podcast is advertising/marketing material. It is not legal advice. Please consult with your attorney on these topics. Copyright Legalpreneur Inc 2022

 

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Legalpreneur transcript:

Andrea Sager  00:03

Welcome to the Legalpreneur podcast. I’m your host Andrea Sager founder and CEO of Legalpreneur Inc. As a serial entrepreneur and someone that works exclusively with small business owners legally protecting their business. I’m dedicated to covering common legal issues faced by business owners, providing you with the business knowledge you need to catapult your business’s growth and showing you just how some of the world’s most elite entrepreneurs have handled these legal and business issues themselves. In true attorney fashion. The information in this episode is not legal advice. This is for informational purposes only and you should always consult with your attorney before implementing any of the information in the show.

 

Andrea Sager  00:45

Hello there welcome back. I am super excited for today’s guest Christie Bouie. She is a fractional CFO who I found on Tik Tok. And I’m so excited because I just love finding people on Tik Tok and actually connecting with them. And so I’m really excited to have Christy here today. Christy, thank you so much for joining us. Yes, I’m so excited. I want to definitely dig into all things tick tock business and all the fun stuff. But first, I would love for you to give the rundown of your background, how you got to where you are today.

 

Christy Bowie  01:17

Yeah, so I am a CPA and I went to school for you know, business accounting, all that I have an undergrad in accounting, and then I have a master’s degree in tax, which everybody is correct. It’s just as bad as it sounded.

 

Christy Bowie  01:32

By it’s so going out of school, I was kind of urged into this path of like, oh, big for county getting, I don’t want to go work for these firms want to be a partner. They’re like, that’s the dream. Great. I did that. I did it for you know, the two years I was supposed to. And I was very quickly like, this is not what I wanted to do. The whole reason I actually loved accounting in school is because it was kind of a puzzle, particularly tax. It’s kind of a puzzle. And this is so interesting, and it’s not really relevant anymore. But I always tell people, the thing that really made me be like, Oh, my gosh, tax is so cool. What

 

Christy Bowie  02:11

was back in the day, during like divorce cases, like alimony and spousal support were treated differently for tax purposes. And so in divorce negotiations, there would be ways for like both parties to win by paying one more in like cash, but it was tax different. And it was like you could get to the best answer for both parties by just changing the verbiage and the taxable treatment for those things. So anyway, that was like one of the strange things that like piqued my interest in taxes being like, it’s a game and you just have to play it right. But there are ways to do it. Right. And so, you know, that’s, that’s what I wanted to do. And I did two years and the big foreign was not doing that. So I kind of moved to a smaller firm, where I was actually kind of involved in financial planning for business owners. So really everything from helping them grow their business, to Okay, we have a growing business. Now, how do we save money? And a tax advantaged way based off of this? How do we open retirement accounts, all of those things. And so you’ll I absolutely loves doing that. But, you know, while I was doing that, we were at a very specific niche, and that firm, and I just wanted to make this information more accessible to the everyday person. I had friends who were business owners, I was in some organizations, that people wanted to start their own business or were self employed, and were constantly asking me for help. And you know, I can’t refer them to my firm that’s charging 1000s and 1000s of dollars for for, you know, a little advice. And so I was just wanting to make this advice, you know, accessible to the everyday person, and specifically women who had not been taken very seriously in the financial world for Yeah, so I kind of took all of the knowledge that I use for both of those and started a basically holistic, what I call holistic luxury, you know, financial advising firm, in terms of you know, we look at everything from your business, how to grow your business, how to take that money home, and then what to do with that money when it gets home. So I really kind of stepped in now as a CFO for clients who are really ready to take that next step. And you know, most of them are on their way to a seven figure business and have probably not been taken seriously by traditional CPAs and advisors. So yeah, that’s really my journey of you know where you got today. I love your journey. It’s very similar to mine. I don’t know if I told you this. So for those listening, I, we did an interview to be on Christy’s podcast and now obviously she’s on mine. But I don’t know if I told you this when he interviewed me but I majored in accounting and I love taxes the same way I was like it’s just a game like that’s all it is so and I went into law school to be a tax attorney. And then when I got the

 

Andrea Sager  05:00

big firm job, they didn’t have a position in the Tax Group. So I was in litigation, I was like, Oh, this is awful. So I only lasted seven months. But I know that I would have had a very similar journey if I were would have done taxes anyway. But I, I still love taxes because it really is a game. It’s a game of life. And it’s a matter of Okay, great. I’ve made all this money. Now, how much do I get to keep? Legally?

 

Christy Bowie  05:31

Exactly. And then just doing all these things? I always tell my clients I’m like, okay, so you have to run this through payroll mean, you have to do this and distributions and all of that. And they look at me kind of funny. And I’m like, but I’m taking all the money home. And I’m like, you just have to play. It’s so silly. But if you do it one way, and you do it another way. I mean, I had a client who, just by changing the structure, they did things we saved over $22,000. And I was like, I know it feels the same to you. But like, we just got to play the role.

 

Andrea Sager  05:58

Yeah, no, I love that. And I’m curious, when you first started your own firm, like, how did you find these clients?

 

Christy Bowie  06:06

Yeah, so I had had, at the time that I was really ready to start my own firm, I was planning on waiting a little bit longer to start my firm, but just some surrounding things made me feel like now is the time to jump. So I had people kind of in my circle, asking me for advice, asking me for help. And I did have like a non compete at my firm, so I wasn’t really capable of doing those other things. So for me, I was kind of like, we have all these opportunities that I’m about to pass up because I can’t take them on and they’re gonna go find somebody else. So that for me, it was like, Okay, this is my sign to jump and start on my own. But after that, you know, your immediate network dries up really quicker than you think. And so, you know, from there, it was actually I did get tick tock clients, which people are always like, No, you didn’t. Yeah, I did. You know, 1000 plus dollar clients from tick tock, especially because I do b2b. Right, so other business owners who are trying to grow their business on Tik Tok, and I found there, I have just been constantly nurturing relationships with other people in kind of adjacent fields. So, I have recently met with an estate attorney. So those people who know who might be starting businesses, and might have significant amount of money to pour into adulthood guidance, financial advisors, maybe bookkeepers who don’t do any taxes, really just anybody who I could find that might have clients who would need advice, because the thing is, a lot of people in tangential fields, like they so badly want their clients to have good tax advice, because honestly, tax impacts almost everything you do. Literally, yesterday I had I was looped in on communications from a new client and her financial advisor. And she was like telling her advisor, she was like, I finally have this accountant. So you can talk to her about, you know, how much I’m making, because that impacts how much you can put away in retirement. And so just building this network of people who really, really wanted their clients to have this level of advice, and just constantly nurturing that, you know, it’s probably been, I guess they started in April. So we’re getting close to the top. And just now those are kind of coming up. So really long, long game with all that.

 

Andrea Sager  08:21

Yeah, that’s awesome. I love that I had a very similar story where my client, like the immediate network kind of dried up, but also I was running into conflicts, because I was in a very niche industry. And within a couple of months, I was like, Oh my gosh, I’m already conflicted out from helping this person because they’re in conflict with another person. So I knew I had to expand very quickly. And same here about tick tock I mean, everybody that listens know I’m obsessed with tick tock and it’s crazy because I remember very recently watching this tech talk with some guy I don’t know his name. And he just came up on my for you page saying people say that they get clients from tick tock or lying. And he I’ll show them I know it was all these people in the comments basically bashing him like, you obviously don’t know how to get clients and you’re wanting to talk about how you have this elaborate business and but anyways, I am obsessed with tick tock because of what has brought to our business and I remember January 2021, I think I had kind of slowly got clients here there but I had my first like viral video on Tik Tok got ended up getting like, I think 550,000 views something like that. And we brought in probably like $20,000 that month in clients from tic toc and it was absolutely insane. And then since then, I’ve just been absolutely all in because it literally can change somebody’s life overnight. And I’ve seen that happen to so many clients.

 

Christy Bowie  10:01

Yeah, and I also think that specifically for service providers, having Tik Tok be a space where you can authentically talk about you in your life. I know for me, the reason clients reach out because I’m always like, you know, why were you interested in me? Like how did you find me? It’s always will I liked your personality. I trust you. It’s not Well, I know you’re really good. Like nobody can but again, it’s because they got to see me authentically and I mean, I haven’t really been in business long enough to hopefully see any turnover yet but I haven’t lost a client Yes, I’m the because they all know exactly what you know they’re getting when they come to you. They know exactly. You know, I’m on tick tock me like, I’m on vacation. I’m not answering emails. So the minute my clients see that they know, hey, Christy is very, you know, she puts boundaries in place. Don’t expect her to do that. Obviously, if it’s an emergency like story, but my clients know exactly what they can expect from me. And having that like authentic presence on Tik Tok has actually made for much better conversions in clients and retention as well. Yeah.

 

Andrea Sager  11:07

So I’m curious for you. When you started on Tik Tok? How did you figure out like, what to post? Because I get that question all the time. People like I don’t even know what to post like my one of my very good friend. I mean, her and her business partner, run multimillion dollar Facebook, paid ad agency. And she’s like, I want to start on Tik Tok. But I don’t know what to do. I’m like, how do you not know what to do? Like marketing is your thing. And so I love hearing from people how they get ideas.

 

Christy Bowie  11:35

Yeah, I mean, honestly, like it was throw things and see if the beginning, it was really interesting, because I’m obviously a very data driven person. So I’m always like, okay, what can I pull out of them. And I found that there were two distinct types of tech talks I post. One is the reach one, obviously, get lots of people. But because I do offer a relatively high ticket service, having reach actually wasn’t very helpful. I was wasting time on sales calls with people who are looking for a low to moderate tech. Because they just happened to see the Tech Talk. And so you know, I can focus on reach and doing stuff like that, calling out other people in the industry, people like really negative stuff, which like makes me very, I actually have, if you guys haven’t heard, like, how to filter your comments. I do it for my sanity, anything in my comments that says, there was one of my posts that like for absolutely no fault of mine, like got political on it. So I like filtered some words that were like, related to political I filter out anytime somebody says CPA, financial advisor investment, like any of those, I have to approve them and my comments. So yeah, so I know what they say. None of them are really bad. But like every now and then you get these posts that like, people just start banging on it has nothing to do with you. So that gives me a little bit of peace of mind. Also, like, it’s my platform, so I get to control what Yeah, but yeah, so a little bit of controversy in a way that is comfortable to me. And then just kind of sharing, you know, particularly around tax season, people always like to know, oh, all these little tax hacks, like all of that, and that’s the stuff that gets the really, really good, does it? Yeah. Oh, my gosh, so much reach like me sharing about, I don’t know, my most reached posts was like one where I was like, Yeah, your accountant doesn’t calculate taxes for you during the years you don’t pay if I don’t know, something stupid, that I was like, why is this? Why are there like hundreds of 1000s of views, but Okay, so that’s really good for reach. But then, you know, when I’m really really looking into getting clients into my world of clients, not listeners and viewers, I go a lot more in depth about what my clients are achieving, about what that journey is for them. Because that my ideal client can relate to watching my current clients go through that journey. So talking a lot about that. I do actually, as of the end of February, I have someone helping me with all of this. So just having another set of eyes. So you know, I’m not going to say I’m perfect, knowing what to do. But yeah, the big thing I noticed is you can get reached or you can get conversion. And also, you know, making sure those ones that if you do have a good return, you do have a good connection, move them over to your Instagram, convert them get them to follow you on a more nurturing platform. Because Lord knows, we don’t have any control of that tick tock Instagram, and I’m not saying I do have Instagram either, but like, at least it’s a little better. And then stories once you get over your Instagram, talk on stories and start having conversations and that’s where I find my biggest conversion. So I would actually say like, do I convert clients off of Tik Tok? No, they don’t convert straight from Tiktok. So maybe that’s what people are saying. But you know that you find that yeah, and then you kind of nurture them along the way that’s that’s been my experience.

 

Andrea Sager  14:57

No, I love that. I will always double down On tick tock anytime somebody is like, how do I do this? How should I do this? How should I market this? Like, tick tock, tick tock?

 

Christy Bowie  15:06

At the very least you’re gonna get like responses to how people feel about it. I don’t know. Have you seen that the macaroni place in Waco? No. Have you seen their tic TOCs? Okay, there’s this is I want to say it’s called like Ramiz Mac. So basically, at the very beginning, they it’s like this, build your own macaroni store or whatever. And they would like it’s like a Chipotle format. Okay, so like scoop macaroni and put toppings on. And the people were like, coming for them. And they were like, This cheese is nasty. You did this out of order, blah, blah, blah. Well, they said, okay, cool. And it, fixed it and changed it in the comments. Now, if you go look at them, people are like, well, we love that you took our advice. Looks great. Now I’m coming to visit, like, they literally took this feedback. And we’re like, okay, cool, like, how can we do better? And now people are like, Oh, this looks awesome. Because they made all those changes. And so, you know, even if you are throwing stuff out and people hate it, listen to their feedback.

 

Andrea Sager  16:06

No, absolutely. I think that’s great. Now switching gears a little bit, I want to hear about your services specifically, and how you help your clients. So can you talk a little bit about specifically, how you work as an outsourced CFO, because most people hear CFO, and it’s like, okay, Chief Financial Officer, that’s for big, big businesses. So how can you really be a fractional CFO and help smaller businesses?

 

Christy Bowie  16:34

Yeah, exactly. So for me, I think it’s very, very important that first of all, you have someone who you can access and you can trust with your financial information, I would say right off the bat, if you’re working with, you know, just a CPA, or just some sort of advisor who you don’t absolutely trust, telling everything, you need to find someone right away, who’s new. And so for me, I work to build that relationship with the founder, as well as their company. Because as a founder, you know, this business, one of the things I talk to my clients is about is what’s at risk for this business? Is this a side project for you? Is this extra income? Or is this your livelihood? Or is this your generational wealth you’re trying to fill in, right, like, what is at risk with this business? And how important is that. And you know, I’m kind of at the point where froze my clients like it definitely is their livelihood, and probably generational wealth. But really, so what I do is I come in, basically take all that financial stuff off their plate. So I am constantly throughout the year looking at a couple of different metrics. So the first I look at is, you know, your gross profit. So per each client, you serve the cost relative to serving that client, what is that, you know, gross margin, and sometimes comparing it to industry. So I work with a lot of people in the same industry. And I can compare like, Hey, I know, this person is doing this. So maybe maybe that’s attainable. So I look at that, I also look at net profits, because you know, we have to make sure we are profitable, at the end of the day, you could have the best margins, but then spend, you know, way too much on rent or your team or things like that. So I’m looking at gross margin, net margin, I’m also looking at your cash position. So making sure that there is enough in these cash reserves to make sure that if something goes wrong, if if you are a you know, brick and mortar in Dallas right now, and you had to, because we have been in snow mode for you know, a couple of days, making sure that you have the money to sustain those changes. Or if you are a seasonal business, I have a lot of clients who have seasonal businesses, making sure that we can get through those seasonal months with this cash supply. So looking at those as well as looking at is just kind of somewhere but looking at the cash flow, how does the money come in and go out? And a lot of business owners have this perception that like, Okay, well, if I’m profitable, I should have money in the bank. But that’s not true for a couple of reasons. So your profit and your cash flow are actually two very distinct things I help business owners track because we could be extremely profitable throughout the year. But maybe we have one big event throughout the year, that gives us that profit, but our expenses are spread out over the year. So it doesn’t matter if I’m going to make a ton of money in July, if I have to pay my staff. And so looking at the timing of where everything is going in the business, to say you know, okay, for most business owners, they know they have an idea of okay, yeah, I make some money, but they have no idea when it’s coming in in terms of how that’s relating to their expenses. So I’m looking at all of that. And then as we progress into the future, I’m associating how the business is growing with your personal life and how you want it to grow in the future. So saying, I actually have this awesome spreadsheet that basically calculates what do you want to do in your personal life? Do you want to have a second home in I don’t even know and that’s going to be a million dollars and we put all of this data in I see What’s the payment on that pool? Based on everything you want to do everything down to pay for my groceries up to buying this vacation home, and paying taxes every year? What does all of that cost? And that is our number of this is how much we want to spend each year, then saying if we want to spend this much each year, and these are our margins back into what income we need in the business to get there, right. So saying, hey, and I’m a big fan of this, because I think right now, there’s a lot of arbitrary business goals. Oh my gosh, I’m a six figure business. Okay, that doesn’t mean anything. So really backing into what that means for your business. And then from there saying, Okay, well, if we aren’t there yet, what do we need to do to get there? Do we need to add a team member so that you can focus on being a CEO and growing the business? And then we go back to the drawing board and say, okay, cool, our cashflow is high in this month, our expenses are low, we can afford to take on a team member this month, and, you know, take that hit maybe while we’re in training, and they haven’t started generating revenue yet. And then we can use that to kind of forecast the future. So all of that. And then of course, in the background, I’m also calculating how this impacts taxes throughout the year because I am a big proponent of no surprises. Every single one of my clients knew what their tax liability was going to be. By January, there’s no surprises in April. And we are calculating that quarterly. Because, you know, like I said, You You never want to be in a position where you have to be in an emergency don’t have enough cash. So we are allocating cash to appropriate sources throughout the entire year.

 

Andrea Sager  21:38

I love that I It sounds like you’re kind of working backwards with the budget, which is exactly what I do. I’m like, Okay, this is what I want to do this year, these are the vacations I want to go on, this is what I want to spend on this, I want to buy a house, I want to do this. And then it’s like, okay, great, got all these numbers. Now, this is how much I have to make this year. That’s what I did a couple of podcast episodes on that at the end of 2022. Because I do not like the traditional way of budgeting, because it’s so limiting. And I’m all about not limiting myself at all. And I don’t think anybody should limit themselves. Like you literally can make any amount of money that you want to. And so I love the backwards budgeting.

 

Christy Bowie  22:18

I actually even take it a step further. And I like to call it a spending plan. Because you’re not restricted. This is literally what we’re spending. There’s, there’s no there’s no budgeting there’s no limiting. It’s just this is like the math of if you want to do this, we do this. How do we get this? I

 

Andrea Sager  22:35

love that. Oh my gosh, I love that. Okay, so what or I would love to hear it because I feel like some people a lot of people in the financial world have different numbers for margins or KPI. So I would love to hear from you. What if somebody comes to you asking for general advice? Because I know it is different for every business. But if somebody’s asking, Hey, what should my payroll percentage B for my business? What do you tell them?

 

Christy Bowie  23:04

Yeah, so of course, this really depends, you know, on the industry and the business, most of my clients are creative service providers, so they do have a lot of staff, you know, on their team, and that is generating the revenue. So in general, high range would be like 30 to 40% would be kind of your gross margin. And that would include like staff who is dedicated to those teams. So you know, maybe payroll be about 30 35%, that’s kind of my goal for my own business. And I am, you know, a service based business as well. So, you know, around that percentage, but I also never, never, never sacrifice what I’m going to pay my team. Because you know, I’m hiring this week, in fact, and I put out a job offer job description, and my pay was like, slightly higher than the average is decently higher. But applicants I got were phenomenal. And everybody’s out here telling me like, I can’t find that I can’t find SAS, I’m like, I offered like a little bit higher than the average because I’m willing to invest in my team. And I’m getting like, great people that I’m so so excited about. So, you know, those are just the averages. But I mean, your team is what’s going to make or break Yes. So that I would say is, you know, yes, we have to make sure their profit, but also looking at, you know, what is that one person going to bring in in revenue, especially if their full job is focused on a revenue generating service, and kind of, again, like that to be about 1/3 of what they’re generating.

 

Andrea Sager  24:39

Okay. And when it comes to, I know, I don’t even want to ask about profit margins, because it’s just such a huge difference for every type of business. I know a lot of course creators like obviously, it’s high high profit margins for the most part because they have no overhead. It’s completely Typically completely remote businesses. So I guess my question for you is, what is your favorite type of business to work with?

 

Christy Bowie  25:09

I love working with creatives, people who are very visionary people, because they tend to have so many ideas in their head and one of my clients, she said, I’m a starter, I really like to start things. I have great ideas. And I’m the first one that’s like, hey, like, let’s go, let’s finish. You told me you wanted to do these things. Because one of the things that is more of an unspoken I guess, thing that I provide my services, I provide accountability. As a business owner, it’s so easy to just say I want to do all these things. Oh, I got busy, I did this. And I get it, those things happen. But especially when you’re a solo founder, no one else is holding you accountable for doing all these things that you want to so I actually asked my clients like their goals. And I say, hey, you know, what do you want to do? And if they say, I want to, you know, add this new service or whatever, that I just thought about two months ago, but I loved it. I put that on our goal sheet. And I track I actually have like, red, yellow green status, like where are we with it? So yeah, creatives are very, very visionary. And they love doing what they do. But sometimes there’s a little bit of stress and anxiety about actually being a business owner. And so that’s where I come in and literally say, you know, okay, I’m going to be your wingwoman. I’m going to like grab your hand. We’re going to do this together. And you’re going to tell me your dreams and visions, and I’m going to give you a path to get there.

 

Andrea Sager  26:34

I love that. Oh my gosh, this has been amazing. Okay, Christy, tell everybody where they can find out more about you. Yeah, so

 

Christy Bowie  26:41

I am obviously on Tiktok and Instagram. At its Christy buoy, it’s part of it people always my name was taken for some reason. So it’s Christy Bailey. And then Chrissy gui.com is my website, you can find I have a page resources, I have some freebies, some, you know, metrics that you can use to calculate your margins. And then also, you know, all my services are there. So I do also share you know, lots of lots of free content on my social.

 

Andrea Sager  27:11

I love it. Christy, thank you so much. This has been amazing. Yes, thank you. Here at Legalpreneur, we’re committed to providing a supportive legal community. For all business owners. I know how scary the legal stuff can be. If you found this information helpful, I would be so grateful if you could share it with a fellow business owner. And quite frankly, it doesn’t cost anything to rate review or subscribe to the show. Your support helps me reach more listeners, which allows me to support more business owners in their entrepreneurial journey. Have any questions or comments about the show? Feel free to drop me a line on Instagram. I promise I read all of the messages and comments. And if you want to be a guest on the show or know someone that would make great guests simply fill out our application form and a team member will reach out if we think it’s a good fit. I’ll see you in the next episode.