The Single Best Accounting Tip for Small Business Success

This question might make many small business owners squirm: Are you still doing your accounting, invoicing, and other bookkeeping tasks with manual spreadsheets? If so, why are you making life so hard for yourself?

And I’m not claiming any high ground on this issue! I still do a shocking amount of bookkeeping, invoicing, and other financial tasks for my business with manual spreadsheets and processes. But I’m a solopreneur/freelancer, and so my business finances are easy to manage. If you have a solo business like me, it might feel “good enough” (for now) to manually track your own numbers and make your own spreadsheets to share with your accountant at tax time.

But most small business owners should consider getting accounting software. Stop suffering and start saving time (and money) during tax season and throughout the year. And even if you, like me, love your spreadsheets and feel like you’ve got a good system in place? You can probably benefit from accounting software, too.

 

Let’s look at a few reasons why choosing the right accounting software is the best thing you can do for your small business accounting.

Accounting software saves you time, money, and stress

Most of the best accounting software programs will help you track your business income and business expenses automatically without you having to create spreadsheets and do manual data entry.

Small business owners are some of the busiest people on Earth. You’re already thinking about so many things every day. Why add one more to that list? Wouldn’t you rather save a few hours per month and let the magic of modern business software take these tasks off your plate?

Accounting software can be “right-sized” for your business

Account software can help you if:

• You have employees
• Your business manages inventory
• You have to track sales tax
• You have any other complex, higher-level accounting needs

The best accounting software tools have a wide range of features and different recommended plans based on your number of employees. Some accounting software also includes bill pay and payroll software, so you can run payroll and manage other aspects of your business finances all in one place.

If you’re a solo entrepreneur, professional services provider, or freelancer (like me), you might have simpler business finances, but still want to save time on tax prep and invoicing. You can choose a lower-cost “light” version of accounting software that gives you just what you need, without all the advanced features.

Don’t assume that accounting software is complicated to use and expensive. Even if you need to have a call with the accounting software sales team, you can quickly get help to figure out which plan is the best fit for your business. And if you need to power up your business’s accounting software as your company grows, you can do that.

Accounting software connects with your bank accounts

Probably the biggest immediate benefit that every small business owner will get from accounting software is that the software automatically connects to your bank. Check to make sure your bank is compatible with the accounting software, but assuming it is, the accounting software will integrate with your business checking account (and often your business credit cards) to track your business transactions.

You don’t have to worry anymore about downloading your business expense transactions into a manual spreadsheet. The best accounting software can keep track of all the numbers for you 365 days per year.

Accounting software can work with your accountant

You don’t have to choose between accounting software and your favorite accountant! You can still get the benefits of professional tax help from a real human along with the time-saving support of accounting software. Several of The Ascent’s picks for best accounting software have features that let you share your business finance data directly with your accountant.

Bottom line

I still love my clunky, manual, self-designed spreadsheets for tracking my small business finances, and maybe you do, too. But this year, I’m going to think seriously about signing up for accounting software. Even if your company has just one staff member, and especially if your business has multiple employees, accounting software is becoming a must-have for every business owner. The best accounting software can help you crunch the numbers, track the transactions, and balance the books.

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