Episode 2: Choosing the Best Accounting Software for Your Creative Business

 Hey there, fellow dreamers and doers. Welcome back to the creative mind smart mini podcast. I’m Samantha Eck trusty guide here to help you unlock the secrets of accounting software. Today we’re embarking on another grand adventure to find the perfect accounting software for your creative empire. Ready to level up your financial toolkit. Let’s get going.

Choosing the right accounting software is like picking your character in a video game. Each one comes with its own unique powers and challenges, whether you’re a solo adventure or leading a small tribe of creatives. The right tool can transform your financial management from a beast into a breeze. Let’s explore these Titans of tech to find the best fit for your business.

Our first contender is wave. Now wave is unbeatable for those price sensitive souls. It’s free. So won’t put a dent in your coin pouch . With its intuitive interface. Wave is perfect for those who want to get started without any prior accounting experience. It offers a robust set of features, including invoicing, expense tracking and automated bank feeds and receipt scanning. Those some features now come with a monthly fee.

But beware as your business grows, waive might struggle to keep up. It’s perfect for freelancers and small outfits, but may falter with larger business volumes.

So keep this in mind when choosing your software, there’s less flexibility to customize it for unique business needs, which might be a deal breaker for those with specialized businesses.

My personal experience with wave and helping clients use it is that a lot of the reports are just not robust enough to really give you the data you need. Especially when working with some other modern accounting software, it just doesn’t really work cohesively and won’t give you. Any insight into how to grow your business. It’s really great for basic expense and financial management, but when it comes to reports, it’s just sorely lacking.

A lot of business owners have also been pretty upset because lately they did increase their pricing where you now have to pay to have your bank feeds connected wave was originally one of the best free resources you could use for accounting, but with it, raising its prices, a lot of people are ready to walk away from it.

Next up, we have our industry overlord, QuickBooks. QuickBooks offers an extensive suite of features that covers nearly every aspect of business accounting from payroll to project management it’s a versatile hub for all your business operations. With various plans to choose from QuickBooks grows with you supporting small and large businesses.

But be warned it’s on the pricier side, especially as you unlock more of its powerful features. For the most part, most of the businesses that I work with only need the lowest tier subscription, but as you grow, you might benefit from additional features, such as bills and invoices inventory tracking. It really just depends on what your business needs.

Be warned there can be a steep learning curve if you’re not really familiar with accounting basics. But there’s always the option to work with someone to help you set it up, to make the experience smoother.

A lot of people that have used QuickBooks in the past and have switched away from it. When I talked to them say that it seemed really complex and they just couldn’t wrap their head around it.

When you have someone who’s there to guide you and show you the ropes, it can really help you to understand where you need to go. A lot of the times, They just don’t understand how the software works or they don’t know where some of this hidden features are, or perhaps they don’t know how to set up the settings.

Someone like me or other bookkeepers offer QuickBooks set up programs where we can help you to set up QuickBooks so that you have that success. I know that QuickBooks itself also offers this feature so that you’re left feeling less confused.

With firestorm in our QuickBooks setup, we actually guide you through the whole process where we start with what your account settings should be we analyze how to set up your chart of accounts. We analyze how to connect your bank feeds, and then we go over at least a month worth of transactions and look at how we can categorize them as well as looking at how to read your financials. It’s a really basic program, but it gives you some deeper insights so that you can be able to handle your own bookkeeping without outsourcing yet. Maybe you’re not ready for outsourcing. Maybe you’re small enough that you just think you can handle it for however long. It’s a great opportunity for you to be able to do so.

Now we also have Xero, which is a fairly new contender, but one worth mentioning. It’s known for its clean user-friendly interface that makes financial management looks stylish. It’s ideal for businesses dealing with goods. Thanks to its superior inventory tracking features. Xero offers powerful automation for bank feeds, invoicing and reconciliation saving you time and energy.

While intuitive, Xero does require some initial learning to fully exploit its features and some screens can quickly become confusing without a guide. For me trying to become a Xero pro felt very confusing and very overwhelming once coming from QuickBooks, there are a lot of differences and a lot of features that I felt weren’t necessary for someone who might be running a smaller business.

Also with Xero payroll integration in the US, isn’t as robust as some of its other competitors, which could be a snag for businesses with large teams. If you’ve ever heard of NetSuite and NetSuite is an accounting software that is used by, really big businesses. That is kind of what Xero reminds me of, but it’s less intensive and more geared towards a much cleaner UI.

Finally we have fresh books. Freshbooks is superior in invoicing. It’s a darling for those who frequently bill clients for projects and services, it offers advanced customizations and features that enhance client interactions, like the ability to see when a client views an. invoice. A lot of other softwares also do this but I know that FreshBooks has a really clean and lovely invoicing screen it’s geared towards small businesses and freelancers who prioritize ease of use and straightforward tools.

Compared to its rivals FreshBooks offers fewer reporting options which might be a limitation. If you need detailed financial analysis without detailed reports, you might miss out on crucial insights for growth. While it offers a lot of features the cost can add up as you have more clients and team members. So again, Freshbooks kind of has that same sticking point as wave.

There’s just not a lot of customization or a lot of good reports that you can look at to really get the information you need to help you grow as a business. And that is what we want out of the accounting software is something that you can put your expenses in shore that you can match up your receipts sure. That you can put your income in, but you really want it to be a place where you can input your data. And then you can pull reports from that to see how you can grow as a business. And there are many different ways you can grow as a business. But it really depends on looking at those reports and what you can garner from those reports.

Let’s dive into looking at a bit of a pricing so we can understand your options fully. Wave has a starter plan, which starts at $0. It allows you to create an unlimited estimates, invoices, bills, and bookkeeping records but again, I want you to remember that the only way you can auto import bank transactions is if you upgrade to their pro plan, which is at least $16 a month.

If you’re someone who doesn’t like to do a lot of manual work and you have a hundred transactions a month or 150 transactions a month. Then wave probably isn’t the best option for you anymore because now you have to pay to auto import those bank transactions. You can still accept online payments and invoice with wave, but a lot of the more complex features are now locked behind that $16 a month fee. I believe that they did this because they probably saw that their product was doing super well. And saw a market for offering a lower cost accounting service so it still is one of the lowest cost and entry level accounting services. But there is now not really a way to get a free processing system for your accounting.

With fresh books, there are several different plans you have one starting at 7.60 at 13.20 one at 24. And then, their one that needs you to talk to a specialist if you have more than that. Now a lot of the times they limit their clients on the lower tiers to how many clients you can send invoices to and some of the things that you can do as well, like automatically capturing receipt data. If you’re on a certain tier as well, you can’t necessarily invite your accountant. And depending on how complex your business is, you might need a higher tier. So for example, the premium plan, which includes everything for fresh books is $24 right now, but it’s 60% off for four months. Which means that come month five, you’re going to be paying $60 a month. So if that’s a little bit pricey for you and you’re like, ouch, I don’t really like that.

Despite liking the UI, you might not really want to take a look at that. So a lot of the ad-ons that they have also include, if you add on team members that adds to the cost per month, if you add on advanced payments, things like that. So it’s really good to think about all those costs when you’re looking at something like that. You don’t really want to get into an accounting software where you regret using it because of how different the prices are.

Looking at QuickBooks. Do you have four different options as well? You have simple start, which is where I start off a lot of my clients. It’s $30 a month for those who aren’t using either their accountant or maybe They don’t have a deal. Cause I know that they give you 50% off for three months. But even with that $30 a month, which is half the price of Freshbook’s top tier program.

You can actually get Bookkeeping automations, you can get invoices, payments, tax deductions, receipt capture, mileage, tracking, everything like that. The more you go up, the more users you can have, the more profitability and inventory you can have. And the more. syncing it can do with different software’s. So the more complex your business is the more you’re going to want to have a higher priced package.

But if your business is very simple and doesn’t need a lot, you just need to track income and expenses. And things like that. The simple start tier is the best place for you to start with.

Now with Xero, they do have a 75% off for six months when you first buy it. Their plans start at 15 ,42 and then 78., Again, they do have certain limitations as to what you can do based on different options. So for example, like if you’re a business that really needs good analytics, that’s going to be in a top tier package along with bulk reconciling transactions or using multiple currencies, tracking projects, things like that. They’re lower tier one, I find actually has less features then QuickBooks does, for example, invoices, you can only send, I think it’s 20 per month or something like that. And you can only enter about five bills, whereas QuickBooks is unlimited in that sense.

So despite Xero being slightly cheaper, it’s not necessarily better. But that’s not to say that. I can really judge that for you. Similar to what we talked about last week, when we spoke about banks, picking an accounting software as a personal thing. The best way to do it is to try a trial of all four and really see what works for you. If wave works for you, if fresh books works for you, if QuickBooks were for you, zero works for you that’s what you stick with and whoever you get as a bookkeeper will just have to understand that.

I have had clients come to me who are on different softwares than QuickBooks. And though most of my clients are on QuickBooks. I’m willing to work with them in whatever software they’re in, because that’s where they feel comfortable. Even though it doesn’t necessarily work with some of my processes. What matters is giving them the support they need so that they can truly grow to become the business that they need to be so that’s very important when you think about what you want. Out of an accounting software.

So those are all things to look at and think about. Again, choosing the right accounting software. Isn’t just a mundane task. It’s really crucial strategy to gear up your business for success. Each platform has its advantages and disadvantages. So really consider what matters most for your business journey.

Are you looking for simplicity? Are you looking for comprehensiveness, scalability, or maybe something that’s just cost-effective. You really want to think about that when you’re looking for what you want out of an accounting software?