how to start a bookkeeping business

This just ties you down geographically and kills your earning potential. Since you’re dealing with someone else’s private and sensitive data as a bookkeeper, you should also get insurance to protect yourself and your company should mistakes or catastrophes happen. You may wish bookkeeping to get business liability coverage, professional liability coverage, valuable papers and records coverage, data breach coverage, etc. Virtual bookkeeping jobs are widely available yet often overlooked. Many people don’t think they have the skills necessary to land a position.

  • Bookkeeping by itself is a part of accounting, and cannot be compared with accounting as a whole.
  • And I have hired a marketing company to get my name out there.
  • Remember that investing in your company entails investing in yourself, so be prepared to put in the time and hard work required to get it off the ground.
  • You should think about your business name carefully since it would be the first impression on potential clients.
  • You could also just plan to spend less each month so you are keeping more of your income.

Despite its closely related accounting cousin, bookkeeping positions are often considered entry level. Starting a bookkeeping business can be very profitable, but you will need to do some work upfront. In this guide, we will discuss the most important things you’ll need to keep in mind along the way.

Earn your certifications

There are many reasons why you might want to start a bookkeeping business. Maybe you’ve worked as an in-house bookkeeper for a business and you’re ready to take the plunge for yourself. While it’s not required for bookkeepers to specialize in a niche, many choose to do so for marketing purposes.

However, it’s best to find bookkeepers with similar experience and skillsets to help you figure out how much you should be charging. Look for a company that offers office space for rent as needed instead of a traditional lease.

How to start a bookkeeping business in 6 steps in 2022 and work from home

This has allowed me to set up systems in my bookkeeping business to streamline operations and become extremely efficient in supporting my clients. Very quickly on, I figured out that QuickBooks was the market leader and I wanted to develop a virtual bookkeeping business on that platform. But, over 10 years ago, QuickBooks Online was still very under-appreciated among bookkeepers. There wasn’t even any training or even a certification around the program. Luckily, my first client pushed me to QuickBooks Online and that has been my platform for my bookkeeping business ever since. Many don’t have the time to keep up with the necessary data entry.

How much does QuickBooks certification cost?

There's no cost to take the exam, which has a total of 80 questions, broken down into five sections. It should take approximately three and a half hours to complete all five sections.

This is something I suggest you save money for each month in case you need to replace your old computer down the road. I’m estimating this bookkeeper spends $600 on a computer every two years, which breaks down to about $25 a month. A bookkeeper’s expenses each month are relatively low, which is why this career is so appealing to many who are looking for a part-time side hustle. With these eight clients, this bookkeeper brings in $4,050 every month. In reality, even CPAs need a decent working computer and internet connection to calibrate proper data input on their archives.

Step 2 – Package & Price 3 Service Options

Start with two or three affordable strategies and work your way up to more expensive ones. Track your results from each carefully, so you know what’s working and what isn’t. In pandemic time this is the best way to start a Bookkeeping Business in 2020. Also, you might want to follow my newsletter (/newsletter) as I’ll be releasing a course shortly on how to set your prices, which I’ll announce there. When you notice areas in your initially documented processes that aren’t smooth, it’s time to update your process to eliminate points of friction. Again, with remote meetings, it’s important that your clients and team can see you very clearly.

How you structure your business will affect your taxes and legal liability, so you may want to hire an attorney or accountant to discuss your options. Universal Accounting offers a proven turnkey solution for building your own accounting practice from home, complete with tools and guidance to empower you to run your business on your terms. If you’re looking into starting a bookkeeping business, or you think another option will work better, your first step should involve education and training. Check out the online programs available for your new career. You also need to determine how you’ll raise the funds necessary to start your bookkeeping business. You can use personal funds, but you don’t want to rely on this.