Understanding the Cost of Bookkeeping for Small Businesses
One of the biggest disadvantages of hiring a part-time bookkeeper is that they provide only partial support in an area of business that requires a lot of attention and detail. You will need to dedicate some of your time to audit their work on an on-going basis, and you may still be required to do more of the high-level accounting work, such as projecting and reporting. This is an added burden to any company owner who is also responsible for many other key areas of the business. Hiring a full-time bookkeeper at 40 hours per week at a rate of $14 dollar per hour (the low end of the average hourly cost cited above) will cost you $560 total for the week.
If you are still wondering how much does a bookkeeper cost, explore your options. An online bookkeeping business has likely automated most of the services you require and they can have a team of experts at the ready if you are in need of help. At Xendoo, finding the perfect flat fee plan is easy, so you aren’t paying more for the specific things you need. Xendoo pricing takes into consideration the varying needs of businesses by offering a range of plans based on your monthly expenses. While this makes it easier to control your bookkeeping costs, most small businesses require consistent services to keep their books straight. Full-time employees also tend to be more involved with the company for which they work, and you should receive greater long-term benefit from working with someone who knows your business thoroughly.
Bookkeeper Salaries & Cost of Outsourcing
If you’re not billing client hours, you might not lose direct dollars by doing your own bookkeeping, but you could still miss out on growing your business indirectly. Time spent on bookkeeping, means that you’re not doing these other things that help you build your business. Again, the best course of action for you to take when setting prices is doing your research. Take a look at industry averages, rates by state, and more to get an idea of how much to charge your clients.
If you need more bookkeeping than you expected, those hours can add up fast. The average cost of a bookkeeper ranges anywhere from $500 to $2,500 a month. By now, you should have an idea of how much a bookkeeper is going to cost you, and how that price tag stacks up against the cost of doing it yourself. Armed with that knowledge, you’re ready to decide whether to bring in a professional or hire outside help.
And just because you can afford a bookkeeper, doesn’t mean you need to hire one. The simpler your books are when you send them to your CPA, the cheaper it will be to file your taxes. A good bookkeeper has the skills and knowledge to make sure that all of your expenses are tracked correctly and comprehensively. This means that they’re helping you to both take advantage of all possible tax deductions, and track everything in the correct way to avoid IRS fines at tax time. Look at the types of services you offer and compare what you currently charge to others. Many clients may be willing to pay a little more in exchange for trustworthy knowledge and training.
- A software program like QuickBooks or NetSuite is practically the standard for these services.
- This requires a more concerted effort and direct oversight by a qualified professional.
- An accountant will provide you with a deeper understanding of financial reporting and reduce taxes where possible.
Companies will often choose to train an existing employee or office manager to take on the extra responsibilities of a part-time bookkeeper. While this may be a lucrative option on paper, any oversight or error in the sheets will come at your company’s expense. This makes understanding reports and data easier for most business owners, as these programs are available to those not skilled in bookkeeping or accounting.
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Add in years of experience, benefits, and cost of living and it gets more expensive. According to Salary.com, the average bookkeeper salary in the United States is $45,816. It also assumes the bookkeeper is entry-level with no specialized experience or qualifications.
Finding the right virtual bookkeeping service depends on the business and its end goals for bookkeeping and accounting. At the very start, every small business should set how much does bookkeeping cost up a basic bookkeeping program, which is available with a virtual bookkeeping service. The highest referral a business owner can find is from a friend in the industry.