How do I add my income to my personal finance balance?
"Create an account called, say, ""Paycheck"".  When you get paid, create an entry with your gross income as a deposit.  For each deduction in your paycheck, create a minus (or expense) entry.  After doing that, what will be left in the Paycheck account will be your net income.  Simply transfer this amount to the real account your paycheck goes into (your checking account, probably). Almost all the time, the value of your Paycheck account will be 0.  It will be nonzero only for a moment every two weeks (or however often you get paid). I don't know if this is the standard way of doing it (in the professional accounting world).  It's a way I developed on my own and it works well, I think.  I think it's better than just adding a deposit entry in your checking account for your net income as it lets you keep track of all your deductions. (I use Quicken for the Mac.  Before they added a Paycheck feature, I used this method.  Then they removed the Paycheck feature from the latest version of Quicken for the Mac and I now use this method again.)" I don't think you need double-entry bookkeeping. To quote Robert Kiyosaki (roughly): Income is when money enters you pocket, and expenses are when money leaves your pocket.  Income is an addition; expenses are subtractions. But if you want double-entry accounting, I'm not qualified to answer that. :) "Congratulations on keeping better track of your finances! Typically there will be a class of accounts labelled ""Income"", under which you will have a separate account for each type of income (stock dividends, paychecks, home appreciation, etc). In that case, showing your income would be a transfer from the Paycheck account to your Checking account.  Note that, as there are no offsetting transactions, this means your income account will steadily accrue a balance over time - just ignore this number, it's only the sum of all your paychecks.  There are methods of dealing with that number (and making the income account have a zero balance), but you don't need to worry about it at this stage.  Just learning to properly track expenses is the major accomplishment."
"SO has observed a lot of irresponsible spending from a parent, which has scarred SO for life OK, so we've got fear... SO is not very financially savvy and has very little idea about how much we earn  ...and ignorance.   You are entirely correct to worry about the conversation. Fear plus ignorance equals disastrous conversations. I manage our finances. Apparently your SO wishes to have input on the management of your finances without understanding them. It strikes me that this serves neither of you well. I would note that it is exceedingly difficult to rationally argue someone out of a position that they arrived at through irrational fear and ignorance. So I wouldn't start by having a conversation about charitable giving at all. Rather, I would start by addressing the ignorance, because that's the easy one.  how high up we are in terms of being in the top y% of households by income Income is irrelevant to the fearful; income can vanish with debts remaining. If your SO is not earning much of that income then SO's future financial security is dependent on the whims of another, which has already turned out badly once for SO.  Focusing on raw income is the wrong way to go; focusing on an abstraction like percentile is even more irrelevant. The figures to focus on are not income and percentile, but rather net worth and change in net worth over time.  Income $300K, expenses $350K eventually leads to poverty if you lack net worth, even if you are in the 1% of income earners. Open up with ""how much do you think we earn?"" Playing rhetorical games with ignorant people seems both risky and perhaps unethical to me, and it seems unlikely to engender trust. I would approach this situation by first removing the ignorance, rather than attempting to take advantage of it for rhetorical purposes.  I would also institute a policy that ignorant people don't get a say. If SO wants to abrogate financial responsibility to you, then SO should accept your decisions without question. If SO wants to have a say in your joint financial life then SO has a responsibility to make recommendations based on both facts and feelings, not just feelings. So, how to remove this ignorance? This will take some doing, but not much. Go through your records and account for: From that you can compute your net worth. Then go back a few years and account for: From this you can show the effect of your past prudent decisions on your net worth. There should be no percentages. There should be no math more complicated than adding and subtracting, and it should be very clear what adds and substracts to what.  People who are financially savvy are extremely intimidated by jargon. If some of your increase in net worth came from a realized capital gain less taxes do not say ""realized capital gain less taxes"" on your summary document. There should be no ""depreciation"" or ""cost basis"" or anything even vaguely like that. Even ""assets"" and ""liabilities"" are too jargonish. ""Possessions"" and ""debts"" are more easily understood. I'm thinking something like: My SO is financially savvy and still I do this about twice a year; it's helpful for both of us to have a quick summary of what's coming in, what's going out, and what we've got. Once the ignorance is gone, then start working on the fear. It sounds like the fear comes from a betrayal of trust, so it's not just enough to be trustworthy, you've got to consistently appear trustworthy. A great way to do that is to keep doing what I already suggested: on a regular, ongoing basis inform SO of how you are doing financially. When SO sees that net worth is consistently improving over time, that you are not one bad decision away from poverty, the fear should diminish. Expect this to take a long time." "I think the ""right"" way to approach this is for your personal books and your business's books to be completely separate. You would need to really think of them as separate things, such that rather than being disappointed that there's no ""cross transactions"" between files, you think of it as ""In my personal account I invested in a new business like any other investment"" with a transfer from your personal account to a Stock or other investment account in your company, and ""This business received some additional capital"" which one handles with a transfer (probably from Equity) to its checking account or the like. Yes, you don't get the built-in checks that you entered the same dollar amount in each, but (1) you need to reconcile your books against reality anyway occasionally, so errors should get caught, and (2) the transactions really are separate things from each entity's perspective. The main way to ""hack it"" would be to have separate top-level placeholder accounts for the business's Equity, Income, Expenses, and Assets/Liabilities. That is, your top-level accounts would be ""Personal Equity"", ""Business Equity"", ""Personal Income"", ""Business Income"", and so on. You can combine Assets and Liabilities within a single top-level account if you want, which may help you with that ""outlook of my business value"" you're looking for. (In fact, in my personal books, I have in the ""Current Assets"" account both normal things like my Checking account, but also my credit cards, because once I spend the money on my credit card I want to think of the money as being gone, since it is. Obviously this isn't ""standard accounting"" in any way, but it works well for what I use it for.) You could also just have within each ""normal"" top-level placeholder account, a placeholder account for both ""Personal"" and ""My Business"", to at least have a consistent structure. Depending on how your business is getting taxed in your jurisdiction, this may even be closer to how your taxing authorities treat things (if, for instance, the business income all goes on your personal tax return, but on a separate form). Regardless of how you set up the accounts, you can then create reports and filter them to include just that set of business accounts. I can see how just looking at the account list and transaction registers can be useful for many things, but the reporting does let you look at everything you need and handles much better when you want to look through a filter to just part of your financial picture. Once you set up the reporting (and you can report on lists of account balances, as well as transaction lists, and lots of other things), you can save them as Custom Reports, and then open them up whenever you want. You can even just leave a report tab (or several) open, and switch to it (refreshing it if needed) just like you might switch to the main Account List tab. I suspect once you got it set up and tried it for a while you'd find it quite satisfactory." "There's a lot of personal preference and personal circumstance that goes into these decisions.  I think that for a person starting out, what's below is a good system.  People with greater needs probably aren't reading this question looking for an answer. How many bank accounts should I have and what kinds, and how much (percentage-wise) of my income should I put into each one?  You should probably have one checking account and one savings / money market account.  If you're total savings are too low to avoid fees on two accounts, then just the checking account at the beginning.  Keep the checking account balance high enough to cover your actual debits plus a little buffer.  Put the rest in savings. Multiple bank accounts beyond the basics or using multiple banks can be appropriate for some people in some circumstances.  Those people, for the most part, will have a specific reason for needing them and maybe enough experience at that point to know how many and where to get them. (Else they ask specific questions in the context of their situation.) I did see a comment about partners - If you're married / in long-term relationship, you might replicate the above for each side of the marriage / partnership.  That's a personal decision between you and your partner that's more about your philosophy in the relationship then about finance specifically. Then from there, how do I portion them out into budgets and savings?  I personally don't believe that there is any generic answer for this question.  Others may post answers with their own rules of thumb.  You need to budget based on a realistic assessment of your own income and necessary costs.  Then if you have money some savings.  Include a minimal level of entertainment in ""necessary costs"" because most people cannot work constantly.  Beyond that minimal level, additional entertainment comes after necessary costs and basic savings.  Savings should be tied to your long term goals in addition to you current constraints. Should I use credit cards for spending to reap benefits? No. Use credit cards for the convenience of them, if you want, but pay the full balance each month and don't overdo it.  If you lack discipline on your spending, then you might consider avoiding credit cards completely." "When you hear advice to buy index funds, that usually comes with two additional pieces of investment discipline advice that are important: These two elements are important to give you relative predictability in your outcome 20 years from now.  In this old blog post of mine I linked to Warren Buffett talking about this, also  mentioned it in a comment on another answer: http://blog.ometer.com/2008/03/27/index-funds/ It's perfectly plausible to do poorly over 20 years if you buy 100% stocks at once, without dollar-cost averaging or rebalancing. It's very very very plausible to do poorly over 10 years, such as the last 10 in fact. Can you really say you know your financial situation in 20-30 years, and for sure won't need that money? Because predictability is important, I like buying a balanced fund and not ""pure stocks"": http://blog.ometer.com/2010/11/10/take-risks-in-life-for-savings-choose-a-balanced-fund/ (feel a little bad linking to my blog, but retyping all that into this answer seems dumb!) Here's another tip. You can go one step past dollar cost averaging and try value averaging: http://www.amazon.com/Value-Averaging-Strategy-Investment-Classics/dp/0470049774 However, chances are you aren't even going to be good about rebalancing if it's done ""by hand,"" so personally I would not do value averaging unless you can find either a fund or a financial advisor to do it for you automatically. (Finance Buff blog makes a case for a financial advisor, in case you like that more than my balanced fund suggestion: http://thefinancebuff.com/the-average-investor-should-use-an-investment-advisor-how-to-find-one.html) Like rebalancing, value averaging makes you buy more when you're depressed about the market and less when it's exciting. It's hard.  (Dollar cost averaging is easily done by setting up automatic investment, of course, so you don't have to do it manually in the way you would with value averaging.) If you read the usual canonical books on index funds and efficient markets it's easy to remember the takeaway that nobody knows whether the market will go up or down, and yes you won't successfully time the market. But what you can do successfully is use an investment discipline with risk control: assume that the market will fluctuate, that both up and down are likely and possible, and optimize for predictability in light of that. Most importantly, optimize to take your emotions and behavior out of the picture. Some disciplines for example are: there are dozens out there, many of them snake oil, I think these I mentioned are valid. Anyway, you need some form of risk control, and putting all your money in stocks at once doesn't give you a lot of risk control. There's no real need to get creative. A balanced fund that uses index funds for equity and bond portions is a great choice." "You're right to seek passive income and since you're already looking for it, you probably already know some of the reasons to why it is important.   Do you live in the United States? If so I'd strongly recommend purchasing your primary residence and then maybe investment properties if you like owning your own home.  The US tax and banking structure is set up to favor this move in more ways than I can count. So, SAVE, SAVE, SAVE then beg, borrow and steal to get the down payment, rent rooms to friends or random people to afford the payments, buy a fixer upper in an up and coming neighborhood.  The US is rife with these in all price ranges. If you're working 56 hrs a week, you've got the work ethic. So if you can't afford it it's probably because you're spending all your money on other stuff. If you want to do this, it will take some effort, smarts, and savings. You will have to trim back the mochas, vacations, dinners out, etc, etc etc.  Let your friends do that stuff and rent from you.  Your life will get continually easier. If you have already trimmed back all the discretionary spending and still can't make it then you need to earn more money. Doing either and both of these things will absolutely change your whole economic life and future. So in summary I'd offer these  Ranked Priorities: 1) Learn to Save (unless you always want to have to work for someone else) 2) Increase your income capability (since your most valuable asset is YOU) 3) Buy and hold real estate (because the game is rigged to favor passive income) I'm 38, never earned a six figure salary, made some good purchases when I was 25-30 and work is ""optional"" for me now." I'm not sure I am fully understanding the nuance of your question, but based on your answer in the comments you and your business are not separate legal entities. So your income is the full $70K, there is no distinct business to have income. If you clarify your question to include why you want to know this I might be able to give a more meaningful answer for your situation. "I really have to use the business card for personal expenses, please assume that in your answer. This is very hard to believe. You must do that? Why not just have the company pay you $1600 each month? Then you can use that money for whatever you want. Why can't you do this? (I cannot think of a legitimate reason...) How to integrate the personal expenses in company? Anyway, to answer your question, what I've done when I accidentally used my corporate card for a personal expense is to code the expense as a payment to me similar to if a check had been written to me. If you aren't ever paying yourself, then you should just pay the company back the $1600 every month. As a side note, I highly recommend you don't do this. By doing this on a regular basis you are opening the door for piercing the corporate veil. This means that the financial protections provided by the LLC could potentially be stripped away since personal and corporate funds are being mixed. The unfortunate end result is that personal assets could end up being fair game too in a judgement against the company. Even if you aren't an owner, your relative could be considered to be ""using business money for personal expenses"", namely, letting a relative spend business funds for personal use. How to show more expenses and lessen the profit? If you're referring to the personal expenses, then you absolutely do not want to do this! That's illegal and worthy of stiff penalties, which possibly include jail time for tax evasion. Better to just have the company pay you and then the entire payment is deductible and reduces the profit of the company." "Open a personal account to link SQUARE with,  open a savings account with same bank.  Register as ""PERSONAL USE"",  make as many transactions you want for whatever you want $5.00 to $1,000.00 or more, you get paid, square collects a fee. Money is in your ""personal account"" in 24 hrs, transfer it to your savings acct.  2 years now no issue.   I've done the EIN, vendors license, registering business crap, if you work for yourself for private citizens it's none of anyone else's concern."