Travel Agency Bookkeeping Tips with Stephanie Cannon – Episode 56

Estimated Reading Time: 7 minutes

When tax season rolls around, most of us shudder at the thought of dealing with our finances.

I literally got goosebumps just thinking about it while recording this episode with Stephanie Cannon, CPA and fellow travel business owner.

But travel agency bookkeeping is simply recording your financial transactions monthly, categorizing them into the right buckets, and reconciling your accounts so you know exactly where your money is coming from and going.

That’s it.

And once you set up this simple monthly system, your financial data becomes one of your most powerful tools for making strategic decisions about fees, expenses, and growth.

The key to successful bookkeeping isn’t fancy software or an accounting degree.

It’s consistency.

Most travel advisors start bookkeeping a couple weeks before the tax filing deadline every year, then spend hours stressed trying to piece together 12 months of transactions.

But when you commit to just one monthly process of recording transactions, categorizing expenses, and reconciling your bank account and credit card statements, you not only make tax time easier, you gain the insights to actually grow your profit without working more hours or selling more trips.

After over 15 years in this industry, I’ve learned that we focus so much on selling trips and marketing our services, but we don’t have any process or system set up to manage the money when it starts coming in.

That’s exactly why I wanted to sit down with Stephanie to break down the essentials of financial management for travel agencies from the perspective of someone who’s been in the trenches of this industry and understands how travel advisors actually operate.

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What Travel Agency Bookkeeping Actually Means

As Stephanie explained, “Bookkeeping is basically the process of recording the financial transactions of your business, so you have a way to accumulate them, put them into buckets, and keep track of things.”

Way back when, accounting for travel agency operations used to involve massive ledger pads with 16 columns.

Everything was written out by hand, the date, who you paid, how much you paid, what it was for, and which account bucket it went into.

Thankfully, we don’t have to do all that manual work anymore, but the principle remains the same.

You’re tracking every financial transaction that flows through your business.

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When to Start Your Bookkeeping System

I had to ask Stephanie when we should actually start doing this work, because I know for many travel advisors, bookkeeping starts maybe a couple weeks before we want to submit our taxes every year.

“As a finance person and knowing the stress that waiting an entire year puts on an individual business owner, my recommendation is that you take care of your bookkeeping every single month. It doesn’t matter if you have five transactions or 500. It should be a monthly process.”

Monthly.

Not yearly, not quarterly at first, but monthly.

And as you go through it month after month, it becomes easier, quicker, and more comfortable to actually execute.

Setting Up Your Accounting System for Travel Agency Success

The monthly process is straightforward- record all the transactions that come through your bank account, credit card statement, or any other financial accounts related to your business.

You’re putting everything into categories- advertising, office supplies, travel expenses for FAM trips, etc. All of it needs to be accounted for.

Then comes the step most people probably miss- reconciling all those accounts.

Stephanie explained that reconciling simply means “you’re verifying everything you entered is the same exact dollar amount as what’s come through your accounts, so you’re not missing anything.”

Same concept as balancing your checkbook, just with your travel agency accounting software or spreadsheet system.

The Separate Bank Account Question

Having a separate business bank account makes bookkeeping so much easier.

You shouldn’t be sorting through personal expenses mixed with business transactions.

Stephanie’s recommendation?

“As soon as you decide to start a business” you should have separate accounts.

Even if you don’t want to set up a business bank account immediately, have a separate personal bank account and/orcredit card.

“At least all of the transactions related to your business activity are in one place, not commingled with personal bills that you’re paying each month,” she explained.

Leveraging Technology for Your Travel Business

The good news is you don’t need fancy accounting software for travel agency operations when you’re starting out.

Stephanie made it clear, “Some of this can just be done in Excel.”

Most banks let you download transactions in a CSV file.

If you’re even a little bit tech savvy, you can upload it into your accounting system or copy and paste instead of keying everything in by hand.

This is where bookkeeping software can save you so much time.

Why Bookkeeping Matters Beyond Tax Filing

Okay, so we know we need to do bookkeeping for taxes.

The IRS requires it, tax filing depends on it, and our CPAs need those financial statements, but that’s just scratching the surface of why travel agency bookkeeping matters.

Stephanie says, “If you’re really looking to grow your profit and not feel like you have to work more hours, sell more trips, you really need to understand your numbers. And the only way you can understand your numbers is to know what they are first.”

The truth is- how can you make strategic decisions about your time and money if you don’t know what your numbers are telling you?

Here’s what tracking your finances actually allows you to do:

• Monitor whether you should raise your fees or change the types of trips you book to warrant higher fees
• Track all those subscriptions that sneak in monthly, quarterly, or annually and charge your credit card before you remember you even had them
• Understand your cash flow management so you have enough to cover expenses
• Make data-driven decisions about marketing and sales focus
• Actually hit your profit goals instead of just hoping you’ll get there

As Stephanie pointed out, “How many things do we sign up for? And especially things that go out monthly, quarterly, or even some of those annual ones that sneak in there, and we’re like, oh, I forgot I had that, and it charged my credit card already or was taken out of your bank account.”

Without knowing your numbers and tracking your expenses, it’s nearly impossible to keep this under control.

Setting Goals and Doing Quarterly Reviews

Stephanie said, “How can you hit a goal if you don’t know what the goal is?”

Setting annual goals should be priority number one for any small business.

That’s why Stephanie recommends 90-day plans and quarterly reviews.

Break out your annual goals into 90-day chunks so you know what you need to achieve each quarter.

What should you review?

Did I make the sales or bookings I anticipated?

Did I charge the fees I was expecting?

Is my commission in line with what I want to receive for the year?

Am I paying too much in expenses?

You can also review what types of trips you’re actually selling and whether they align with what you want to be selling.

Your financial data can tell you that you need to switch your marketing focus.

The Money Stories We Don’t Realize We’re Carrying

This was probably my favorite part of the conversation because Stephanie went beyond just the mechanics of bookkeeping and got into why so many of us avoid it in the first place.

“Everybody has stories and beliefs around all of this, and whether you realize it or not (most people don’t), that’s the reason most people aren’t diving into their finances in their business.”

It could be as simple as “I’m bad at math” or “numbers aren’t my thing.”

Stephanie said, “Travel is sales, and we put a lot of our money stories on our clients and our potential clients that we don’t even realize.”

I know this runs rampant in our industry where we shop out of our own pocket and not out of our clients’.

Making these assumptions about what we think other people might be able to afford does more harm than good.

As Stephanie shared: “I used to be one of them that wondered, why can’t I break through my money goals? Why am I constantly selling and booking trips and still not making the money that I want to make? And it wasn’t until I really addressed those things that I became more aware.”

The Sample Chart of Accounts for Travel Agency Operations

One pain point that came up repeatedly was the chart of accounts.

Stephanie called it “probably the number one question that I get asked.”

Your chart of accounts is basically the buckets you put your money in for your income and expenses.

It sounds simple, but setting it up correctly for a travel business has its own unique considerations.

Once you have it set up properly, categorizing transactions becomes much easier.

Where to Start (Even If You’re Behind)

If you’re reading this and feeling overwhelmed because you haven’t been doing monthly bookkeeping, take a breath.

Stephanie’s advice: “Just start somewhere with your finances. Don’t feel bad about it. Don’t beat yourself up. Maybe you’re just not aware, and today’s always a good time to start.”

Here’s my recommendation:

• Set up a separate bank account for your business if you haven’t already
• Choose your system, even if it’s just a spreadsheet to start
• Block time each month to record your transactions
• Reconcile your accounts monthly
• Review your numbers quarterly
• Set actual financial goals for your business
• Consider working with a CPA for travel agents when you’re ready for support

Accounting for travel agencies doesn’t have to be complicated.

It requires some time each month and setting up a system that works for you, whether that’s accounting services, bookkeeping services, or a well-organized spreadsheet.

Once you have that foundation, you’re gathering the intelligence you need to build the travel business you actually want.

As someone who’s been in this industry for over 15 years, I can tell you that the travel advisors who understand their numbers are the ones who can scale without burning out.

They’re the ones who can hire a team, invest strategically, and actually reach those profit goals.

As Stephanie explained, “How do you know what to sell and market if you don’t have your goals set? And how do you know what goals to set if you don’t understand your money?”

Without understanding your payroll, your expenses, and tracking your financial transactions, you can’t make the strategic decisions that will actually grow your business.

Your financial reports and financial statements aren’t just for your accountant or for tax time.

They’re for you.

So start tracking your numbers monthly.

Set up that separate account.

Get your transactions recorded and reconciled.

You can’t manage what you don’t measure, and you deserve to have a profitable, sustainable travel business that supports the life you want to live.

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