Whether we like it or not, Homesteading & Small Farm Accounting is one of the necessary evils of life. Maintaining a working farm takes dedication, attention to details and time. A lot of time. But we love most every minute of it. I say most, because taking care of the numbers can be frustrating and time-consuming.
When the income is less than the expenses, it can be heart-breaking. But the flip side can be even worse – not keeping up with the financial numbers. If you don’t know how much is coming in, or how much is going out, you could very easily lose everything you have worked so hard for.
Most accountants want a breakdown of everything you spend. The IRS wants to make certain you make a profit at least every 1 to 3 years. But how can you effectively know if you are?
An Excel spreadsheet works wonders. With the spreadsheet, you can break down each item under income and expense sections. Within your expense categories, you can break it down even further. By adding formulas, all you have to do is input the actual numbers, and Excel can calculate everything for you.
If spending less time on the numbers end of farming is appealing you, a Homesteading & Small Farm accounting spreadsheet can work easily into your routine. I keep all my receipts, notes on cash income and invoices in a box on my desk. One day a week I sit at the computer and input all the information in the correct category. Even on a heavy week, I usually spend one hour or less taking care of the financial business. Once I am finished with inputting the information, I store all the receipts in a Manilla envelope with the year written on the front (just in case there are questions). That frees me up to work outside, or do other things.
A homesteading & small farm accounting Income & Expense Spreadsheet also comes in handy when it is time to do a budget. You can easily refer to last year’s expenditures to determine how much to budget for the next year. If you find yourself in desperate need of a large purchase, such as a new tractor or just expensive tractor parts, you can quickly access your budget and your Income & Expense spreadsheet and see where you stand financially.
The Search is On for a Homesteading & Small Farm Accounting Spreadsheet
When we first started farming, I searched for farming accounting software. Most all I found was geared towards what we call ‘large’ farms. Farms in this category are row croppers (corn, wheat, soybean, etc.), or ranches with hundreds or more head of livestock. None of them were geared toward a small farm or homestead.
Where a large farm basically looks at seed, fertilizer, equipment and supplies (that isn’t all they have for expenses), a homestead may have multiple categories of livestock (cows, goats, rabbits, chickens, etc.), PLUS fresh vegetables, farmers markets, value-added products and more. Some homesteaders also have websites, or teach classes.
The category list can go on for miles. Yet, to get a clear picture of your finances, you need to have something in place.
Since I was unable to find anything that would work for our small farm, for years I did it the old fashioned way – paper, pencil and adding machine. We kept all our receipts in an envelope, and pulled them out in December to begin the arduous task of figuring out where we stood. We always thought that having ‘just a budget’ would suffice. Wrong.
Do It Yourself
I now have a homesteading & small farm accounting spreadsheet for my income and expenses, dedicated to track my small farm finances. It makes the accounting so much easier, and less of a headache. I know exactly how much money I have, and where it is going.
There is also a chart that can help make decisions on what to keep and what to cut. For instance, with the chart I can see at a glance that our egg sales produce enough to provide feed for our chickens, plus a little profit. However, rabbits cost three times as much as the income they produce. It just would make sense to let the rabbits go, and put the money towards something else on the farm.
Once you have input amounts in the Income or Expense sections, a formula automatically transfers the information to a Chart Calculation section. This information is transferred to the chart. The chart lets you see at a glance where you stand in any category.
One of the benefits of having an Income & Expense spreadsheet with a chart is that you can free up time for other things. But it can take a full day, and up to several days to do the design work, input the categories, get all the information down and create working formulas for each category. And that is before you begin adding your numbers. It seems to defeat the purpose.
The hard part of designing a spreadsheet has already been done for you! Categories, formulas, and a chart are completed, and ready for your customization. Below you can easily download the Income & Expense Spreadsheet for Homesteaders and Small Farms, complete with an Income-Expense-Difference chart that shows you where you stand. There are even categories for a website, speaking engagements and classes you may teach.
In order to capture as many aspects of homesteading and small farming as I could, I listed categories that may not apply to your farm. Once you download (and save a copy to your Excel program – PLEASE!) you can easily go in and personalize it to your farm, either by deleting sections that you don’t have, or overwriting them for categories that aren’t listed.
For instance, you may not have cattle, but you do have Alpacas or Llamas. It’s easy to go to the Cattle category, click on the category cell, and type in ‘Alpacas’. Then in the breakdown categories, you can change anything that doesn’t apply. You can also add rows for categories that aren’t listed, and simply copy and paste the formula into the correct cell.
Yes, you may have to take a few hours to get everything set up initially. At least a basic working knowledge of Excel is recommended, as there may be some formula changes that may need to be made to accommodate the changes made for your homestead or small farm. But one day of set up, and then an hour or less a week for maintenance is easily better than a full day every month, or several days at the end of the year. Plus – if you have any questions on how to set it up I am just an email away.
Just So You Know
This Spreadsheet does not come with a budget. Budgets are a very personal thing, and should include both farming income and expenses as well as personal. It would be next to impossible to know what categories to include in a ready-to-use, personalized spreadsheet. )
Here’s a preview of what you will get!
Income/Expense Difference & Chart Calculations
At a Glance Chart
If you are interested in getting your finances organized and easier to manage, plus save time, just download your copy HERE. It costs $7.99, and can be paid through PayPal. If you would like more information on the Income & Expense Spreadsheet for Homesteaders and Small Farms, just click HERE!
Just think – in a few hours you can have your finances well on their way to being organized. And after Christmas this year, instead of trying to find all those receipts and spending hours, if not days, getting your finances ready for tax time, you could be relaxing and enjoying the rest of the holidays!