Top 5 Accounting Tools for Professionals & Small Businesses

If you dread doing the bookkeeping for your small business, you’re not alone. Half of all small business owners cite accounting as being what they dread the most. Whether it’s disdain for the tedium of accounting or aversion to math, avoiding your bookkeeping can be detrimental or even catastrophic.

Accounting is how you stay abreast of your expenses, taxes, payroll, a small business loan, and other points of financial data. Further, unless you consider yourself a math and business finance prodigy, these vast swaths of data aren’t the sorts of things you can track in your head. That’s where a great accounting tool comes into the equation.

Instead of keeping track of your business finances by hand, a great accounting tool can streamline all your financial data while minimizing mistakes. If you want real staying power as a professional in your industry, getting a firm grasp on your business bookkeeping is essential, and using a great accounting tool is how you can do it.

Here are five accounting tools that are particularly great for professionals, entrepreneurs, and small business owners.

FreshBooks

Since it was overhauled in 2017, FreshBooks has been commended by both critics and users. In fact, FreshBooks was recently awarded an Editor’s Choice award by PC Magazine with the review citing the outstanding user interface, robust collaboration tools, and contextual awareness as a few of the program’s strengths.
FreshBooks excels at invoicing and managing subscriptions, making it as valuable for freelancers as professionals and small business owners. However, FreshBooks isn’t viable for larger companies with diverse product offerings or lots of SKUs on file because it lacks any real inventory-tracking system or product records.
Starting at $15 per month for the FreshBooks Lite plan, FreshBooks continues to be a popular option for smaller-scale operations needing a capable, user-friendly accounting tool.

Xero

According to the review published in Inc., Xero offers “some of the best small business accounting software in the game.” In fact, Xero’s strengths are clear from the very first moment you use the software with the easy-to-use setup wizard built right into the program.
Though often compared favorable to accounting mainstay QuickBooks Online (which also appears on this list), Xero is unique for offering a double-entry system. In other words, transactions and other records entered into the software are reflected in other data; for example, if you receive a Merchant cash advance and input the advance into Xero, your Loans Payable value will increase. So using Xero gets you easy access to straightforward, actionable snapshots of financial data.
With the Basic version available for just $9 per month, Xero offers a double-entry system and great invoicing features for a very low cost.
QuickBooks Online
As the incumbent leader on this list, QuickBooks Online has the advantage of its 35-year reputation for excellence, backed by the Intuit name. In fact, even people who have never used or touched account software before are at least familiar with the QuickBooks name.
Intuit — which also manages TurboTax — has put over three decades of wisdom to good use: QuickBooks Online exhibits a deep understanding of what users want, especially with a polished, aesthetically-pleasing user interface. Additionally, there’s an array of useful integrations with software and services you probably already use. These integrations include first-party applications made by Intuit and such third-party applications as PayPal, Bill.com, Zoho Expense, Veem, and Shopify.
QuickBooks Online also offers some of the most extensive reporting options in the industry. Again, over three decades of experience in business accounting means QuickBooks Online knows what users want and need.
The main drawback to QuickBooks Online is that you might pay a bit more for their expertise. The basic QuickBooks Online plan — called Simple Start — costs $10 per month. But it only offers access to basic features that may not be enough for a small business. If you need integrated payroll, inventory tracking, multiple users, project tracking, or integrated tax preparation, you’ll have to either pay for add-on features or upgrade your plan.
Zoho Books
Though not as ubiquitous as QuickBooks, Zoho might be familiar to you if you’ve used one of the company’s many software tools. Until recently, Zoho was known for its own web-based suite of Microsoft Office alternatives. As the company built a portfolio of other software options, Zoho Books emerged as a capable accounting tool in its own right.
Arguably the greatest strength of Zoho Books is that it offers many of the same features as its competitors for a low cost. Even the most basic Zoho Books subscription gives you such features as creating and managing timesheets, project management, expense tracking, automating up to five workflows, and robust invoicing.
There aren’t many drawbacks to Zoho Books, but the shortcomings most often cited are the lack of any payroll integration and report customization options. Otherwise, most professionals, entrepreneurs, and small business owners have praised Zoho Books and its starting subscription price of $9 per month for the Basic plan.
Wave
Most accounting tools offer a free trial, but Wave undercuts the competition by giving most of its features completely for free. However, putting its $0 cost to the side for a moment, Wave is still a very capable accounting tool for small businesses.
With subjectively one of the cleanest and most user-friendly interfaces, Wave offers a rare double-entry system bolstered by an array of reporting and analysis features that are never more than a couple clicks away.
Fortunately, Wave’s limitations are really only relevant to larger businesses and companies. For example, Wave lacks in-depth inventory management options, but freelancers, professionals, and small businesses have a lot to gain from Wave’s robust expense tracking as well as the invoice and transaction management.
There’s no right or wrong answer when choosing the right accounting tool for your small business. The tool that works best for one professional or small business owner may not offer the right combination of features or capabilities for another.
Whether you choose Wave or Xero, QuickBooks or FreshBooks, or even some other accounting tool, ultimately, the purpose of these tools is to ease the burden of accounting. So instead of dreading it, embrace your bookkeeping by letting a great accounting tool be the key to your success.
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