I tried using bill.com with this particular client, but I actually didn’t really find it as helpful as I would have hoped. I often just use the bill pay directly through the bank with this client, as it’s relatively easy to do, and many banks will do that service for free. The main types of checks I write are reimbursement checks if the teacher buys supplies with her own money, or certain vendors will send invoices, and I will write a check for those. I’m trying to help my client get away from that by training them to use their debit card to pay for vendors rather than having them invoice for a paper check.
New bookkeepers will enter at a lower rate than those with years of experience under their belt. According to Indeed.com, entry-level bookkeepers make an average of $18.34 per hour. If either part-time or in-house bookkeeping is not the ideal solution, switching to outsourced bookkeeping or accounting could be your best option. Many businesses are concerned about switching over to outsourcing, not understanding how the pieces fit together with this model.
- The challenge though, can be persuading your clients to agree to it.
- It’s unusual for the bookkeeper to be able to write and sign checks, but because it is such a small business, we have our duties divided a little bit differently than it may normally look.
- Smaller clients generate less revenue than medium or large clients.
- They helped me catch up on over a year of lackadaisical sloppy data entry.
- Discover the direct correlation between standardized processes and boosted profits for your accounting firm.
Any of these options might be perfect for you right now, and the best option will change throughout your bookkeeping career. Add footnotes to the bundles to mention limits and overage rates. There are two additional benefits if this method will work in your situation.
Simplify Your Business Finances
Your bookkeeper can’t, however, prepare or file your taxes for you as part of your Live Bookkeeping service—even if they’re a credentialed CPA. But with 12 months of accurate books, your finances are accurate and ready to file taxes at year end. Your bookkeeper brings your past financials up-to-date and sets up your bank connections and chart of accounts. If you invoke the guarantee, QuickBooks will conduct an evaluation of the Live Bookkeeper’s work.
Try our payroll software in a free, no-obligation 30-day trial. You may also consider throwing in other costs, like a fee for an initial consult, to your pricing structure. Many clients may be willing to pay a little more in exchange for trustworthy knowledge and training. Depending on your experience and skills, you can charge between $15 to $30/hour as a remote, beginner bookkeeper. It’s worth mentioning that you have to start working as a bookkeeper before you can apply for certification programs, and as we said, you need at least 2,000 to 3,000 hours to qualify.
It means you set a fee for each service you offer and provide clients with a ‘menu’ of sorts, with corresponding prices. Whether or not you’re self-employed is a major factor in how much you make as a bookkeeper. For W2 workers, the average hourly rates are closer to $20/hour, while self-employed bookkeepers earn closer to $30/hour. They require very different levels of effort and expertise and as you can imagine, the cost for full service accounting is much higher. However, most businesses that make the leap see the value and experience an ROI rapidly.
Types of services you offer
One way you can determine how much to charge is to tie each task to a dollar amount. When you’re first starting out, it’s hard to get a grasp on that, though, which is why I like to put it based on terms of approximate hours worked. Most likely, you already have an hourly rate in your mind that you’d like to be working at, and you likely did not get into bookkeeping to be making $10 an hour. Becoming certified in your accounting software is a green light for business owners. They’ll be more inclined to pay higher fees if they see you’ve been endorsed by well-known software companies, especially if it’s the software that they use for their accounts.
Practice barrier #6: value pricing & bundling
On the other hand, there are times you can charge a much higher hourly rate. There’s a lot of coordination and logistics involved in running a small or medium sized business. Entering your busy season or dealing with employee turnover can distract business owners— resulting in inefficient infrastructure and plateauing growth strategy. You’ll find that bookkeepers who have completed all 3 programs have a much higher average hourly wage. Additionally, there are quite a few outside expenses that come with hiring an employee.
Therefore, you generally want to charge a small client less because they have fewer needs. If you want to learn about the fastest way to become a self-employed bookkeeper, working flexible hours online for your clients, check out Brilliant Bookkeeper. Your bookkeeper will go over your reports to help you understand your financial situation, but may not provide financial or business advice (even if they’re a credentialed CPA).
If you’re contracted as a bookkeeper, your client isn’t in charge of your sick time or vacation time or disability or leave or anything that they may have to think about with an employee. You can categorize your clients into small, medium, and large based on the amount of time you spend on their bookkeeping each month. There is no magic number to know when you’re ready to take on a bookkeeper for additional support. Instead, it’s more of a holistic view of time, resources, and the ability to become more efficient that will make or break your decision. If the answer is yes, then size shouldn’t be your deciding factor.
While you’re waiting for your chance to branch out and start your own small business, you can use this time to practice your negotiation skills. Making a strong case about why you deserve a raise will get you used to the process when it’s time to raise your rates with your clients. Your business probably already uses tools and software to help keep your records and operations organized— adding in more applications to your tech stack can often cause more stress than it needs to. Whether you’re hiring in-house or outsourcing your bookkeeping, finding someone that has the right software tools to make finance management easy is important. For clients with more than $1 million in revenue, it would be good to look at how much they would pay a full-time bookkeeper, sitting in their office, working 40 hours a week. As a contractor, you’ll be doing the work quicker because you won’t be dealing with all the office management, so it’s actually better for them to hire you part time than it is to hire a full-time employee.
When implementing fixed-fee or value-based billing, it’s easy to under or overestimate the time it will take you to complete a task. Having an open dialogue with clients about this when you’re first signing them can be a good idea to pre-empt adjustments down the line. Maybe their data is poor quality or someone on their team isn’t doing their job meticulously; there are many factors that could impact your ability to deliver a job in the timeframe you accounted for.
Xero and other accounting software have their own qualifications which, once earned, show you’re an expert in their product. When you’re calculating your rates, especially in a new location, doing local research is crucial. Ask other bookkeepers about services, rates, and gather any other information about working in your area that will help you stay competitive. Consider how frequently you provide services to a client when making up your mind about what to charge. Some clients will be a one-time deal, while others may need you on a regular basis (e.g., quarterly).
These include basic and full-service bookkeeping, where the decision largely depends on your business goals and needs. I work a maximum of 20 hours per month on this particular client’s books and charge $1,000 a month. I work a maximum of 10 hours per month https://simple-accounting.org/ on this particular client’s books, and charge $500 a month, which still comes out to be roughly $50 an hour. To illustrate what a medium client looks like, I’ll be using a law firm I do bookkeeping for that generates about $800k in revenue a year.
Some clients require more frequent attention than others, and there are even certain times of the year that might be busier than others for your clients. Generally, you’ll charge a lower rate for clients you see more often. how much should i charge for bookkeeping While many self-employed bookkeepers work remotely, if you’re providing services locally, hourly rates vary state-by-state. States like Massachusetts and Washington have the highest hourly rates for bookkeepers at $40+/hour.
