How Much $ Do You Re-invest?

[DCMomOf3]

My husband and I are discussing how much money I should be reinvesting in the daycare for new equipment, toys etc. I don't know where a good % point is. Does 5% or 10% sound more reasonable? I want to re-invest a little more than my husband does.

[emosks]

We take our weekly income and started off keeping 20% in the account. Then split the remaining amount to pay ourselves.

Now that we have the account built up we are doing 15% for a while and then hopefully after the new year down to 10%.

This money is for insurance, toys, groceries, supplies, etc.

[kendallina]

We take our weekly income and started off keeping 20% in the account. Then split the remaining amount to pay ourselves.

Now that we have the account built up we are doing 15% for a while and then hopefully after the new year down to 10%.

This money is for insurance, toys, groceries, supplies, etc.

Does the 20% include money you're saving to pay taxes? I'm very interested in this thread since I'm just starting out and (like the OP) want to spend more than my husband wants me to....

[emosks]

Does the 20% include money you're saving to pay taxes? I'm very interested in this thread since I'm just starting out and (like the OP) want to spend more than my husband wants me to....

No, because we are taxed on what we make as income. I take my percentage out of my split and put that in savings for taxes. But I'm also set up as an LLC too, not an individual.

[kendallina]

No, because we are taxed on what we make as income. I take my percentage out of my split and put that in savings for taxes. But I'm also set up as an LLC too, not an individual.

Got it, thanks for responding.

[mncare]

I don't do anything like that. I just keep all of mine in my account and use it for whatever I need. My personal and business stuff. But I don't keep receipts for my food though because I use the food program and we don't have to. Do most of you set a bit aside like this? I do have a savings account that I had thought about setting money aside in but just haven't done it yet.

[SunflowerMama]

I don't do anything like that. I just keep all of mine in my account and use it for whatever I need. My personal and business stuff. But I don't keep receipts for my food though because I use the food program and we don't have to. Do most of you set a bit aside like this? I do have a savings account that I had thought about setting money aside in but just haven't done it yet.

I don't set aside either. It just all goes into one account and I purchase items/supplies as I need them. I keep all my receipts for the month and spreadsheet those as well as $$ coming in but I don't put a set limit on what I will spend on the childcare each month. It varies but typically I'm right around $750 for food/curriculum/supplies, etc. each month.

[DCMom]

I am set up as a sole proprietor. I keep 40% each week in my business checking. I pay estimated taxes, contribute to my SEP and pay business expenses out of that. At tax time if we owe anything, it comes out of there (generally we owe something to either state or federal!)

After that, if there is money left in there (there is usually a fair amount), we consider it our 'tax return' and do some big home improvement project with it. This year we extended our driveway (for parking) and replaced garage doors (damaged by someone hitting it). I guess you could call that re-investment...

I have been in business awhile, so I don't have a need to buy a lot of 'big' things because I have most everything I need. It's mostly repair, upkeep and replacement.

[Abigail]

I don't set aside either. It just all goes into one account and I purchase items/supplies as I need them. I keep all my receipts for the month and spreadsheet those as well as $$ coming in but I don't put a set limit on what I will spend on the childcare each month. It varies but typically I'm right around $750 for food/curriculum/supplies, etc. each month.

I am really into spreadsheets, I have one for my wedding expenses and it sure adds up fast! All my columns calculate automatically and add the tax and if I purchased five of something it will multiple,etc....saves time with using the nice formulas. I can see how it will come in handy with daycare. I agree, I wouldn't want to put a monthly spending limit either because I might not need to spend that much or may go wayyyy over!

I am set up as a sole proprietor. I keep 40% each week in my business checking. I pay estimated taxes, contribute to my SEP and pay business expenses out of that. At tax time if we owe anything, it comes out of there (generally we owe something to either state or federal!)

After that, if there is money left in there (there is usually a fair amount), we consider it our 'tax return' and do some big home improvement project with it. This year we extended our driveway (for parking) and replaced garage doors (damaged by someone hitting it). I guess you could call that re-investment...

I have been in business awhile, so I don't have a need to buy a lot of 'big' things because I have most everything I need. It's mostly repair, upkeep and replacement.

What is a SEP?

[Chickenhauler]

What is a SEP?

Simplified Employee Pension

http://www.irs.gov/retirement/sponsor/article/0,,id=139828,00.html

One of many investment vehicles available to self employed persons.