How to choose the right accounting software for your freelance business

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Just for the fun of it, type in “accounting software” into your favorite search engine and see what appears.

When I Googled it, I found a list of apps, ads and reviews of the top online accounting software programs.

Figuring out which one to use is overwhelming. But there is hope.


screen-shot-2016-10-19-at-4-20-42-pmThis article is brought to you by our partners at AND CO. With a sleek app and a real-life human on your side, AND CO is all you need to take the headache out of billing as a freelancer. Our partnership has not affected the value or content of this article. Learn more at and.co

Sidenote: When you're done here, learn from 150+ freelancers who've been in your shoes with our all-new 30-day bootcamp: Zero to Freelancing. You'll love it.


The Beginning of My Love/Hate Relationship With Freelance Accounting

Like most freelancers, my accounting methods evolved with technology. I started with what many people who hate working with numbers do: pen and paper. That lasted about two weeks. I lost my notebook, and my precious financial information was gone.

After scouring my account statements and memory to recreate my freelance finances, I entered the information into a spreadsheet. This worked great in the stone age, when most people still used AOL and checks made out of real paper came in the mail.

Technology Appears and Makes Things Easier

As technology evolved, my freelance business became more sophisticated. I found myself unsatisfied with my spreadsheet accounting system. I created a new spreadsheet for every invoice. My loathing of everything mathematical meant I often forgot to record transactions. Every tax season, I handed a huge mess to my mother/accountant.

My clients were far more technologically advanced. One of them introduced me to PayPal. I discovered you could get paid without grabbing the mail and cashing a check. This revolutionized my cashflow by allowing me to get paid faster. I experimented with invoicing through a PayPal business account.

Accounting Software to the Rescue!

A little over two years ago I got serious about my freelancing. I was no longer satisfied being a corporate slave. I enjoyed my job as a marketer and graphic designer for a local real estate brokerage. But I wanted to be a writer. Full-time.

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I worked on building my business and my client list grew. As I took on more projects, I realized an accounting system upgrade was inevitable. I needed a real accounting software.

After purchasing a project management system that included invoicing, I was happy to find a place to organize my finances and work in one place. But I spent a lot of money on a broken system that delivered less than promised. Many of the marketing automation features didn’t work, and I got a partial refund for my time and trouble.

How to Choose an Accounting Software

I’m now on my third accounting software adventure in two short years, and I’ve come to discover that not all products are created equal. I’d like to share with you some of the things I’ve learned to help you choose accounting software that works for your freelance business.

  1. I hate taxes, and do everything I can to make tax time go as smooth as possible. If you start using accounting software in April, do yourself a favor and enter everything back from January 1 to the exact moment you set it up or you’ll have a mess at tax time. (Trust me, I’ve been through this more than once.)
  2. Don’t spend an arm and a leg on accounting software. I made the mistake of paying for 24 months of an accounting software that didn’t fit my needs to get the best deal. Two weeks into using the software of my dreams, I asked for a refund.
  3. If you work by the hour, choose accounting software with a built-in time tracker.  This makes invoicing a breeze.
  4. Project management components help you stay focused. AND CO includes a Task Manager that helps you stay on top of tasks unrelated to accounting.
  5. No one piece of software is perfect. It doesn’t matter how much you pay. Try a few on for size and use what works best for your needs. As your business grows, you may outgrow your software. But for now, the important thing is to find and use a system that works well for where you are.

Wrapping It Up

Accounting is often scary for creative types. But it’s the lifeblood of your business. Choose an accounting software that allows you quickly and easily stay on top of your business finances and you’ll be happy you did.

What is your experience with accounting software? We’d love to hear about it in the comments!

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About Sharon McElwee

Sharon McElwee is a copywriter and freelance business coach dedicated to help people get better at making real money doing what they love. Before having such an awesome career, she spent a couple of decades working in commercial printing and as a corporate slave. Check her out on YouTube .

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