Additionally, bookkeepers must follow document retention standards. An audit can happen to any client, so in order to help auditors and the IRS, well-kept records and records kept for the allotted time period are critical during an inspection. Bookkeepers could be met with financial fines or lose their ability to provide services if they don’t follow retention standards.
No matter the reason, running your own bookkeeping practice can be extremely fulfilling. Learn how thousands of businesses like yours are using Sage solutions to enhance productivity, save time, and drive revenue growth. Sage Fixed Assets Track and manage your business assets at every stage. Access all Xero features for 30 days, then decide which plan best suits your business. While you’ll set yourself up to succeed, you need to be willing to admit when things go wrong.
Choose a business structure
Some bookkeepers choose to obtain certifications for their business. Bookkeepers can be certified in various financial platforms, such as QuickBooks, or via training programs. You can also choose to become a certified public bookkeeper to market yourself better as a bookkeeping professional. The challenge, of course, is finding enough clients to earn the type of salary that you need. Fortunately, many small businesses do not have enough work to make a full-time bookkeeper financially feasible, so there are customers out there. Market your skills correctly and you’ll have a large client base.
- Also, consider joining a bookkeeping group or association that offers information and support from peers in the industry.
- They’re likely to be forgotten as soon as they’re heard or read.
- She has written legal and marketing content and communications for a wide range of law firms for more than 15 years.
- Whether you create your website yourself or hire a web developer, you’ll likely need to determine what you want on your website and factor that into your startup costs.
To Business Bookkeeping: Basics for Business Owners the information in the document-sharing program, you need a user ID and password. And more importantly, there’s no need for physical backup because files are in the cloud. As a bookkeeper, you should have liability protection in case you get sued for a mistake on your client’s books. Insurance can both cover the cost of settling a lawsuit and the lawyer fees to defend against a lawsuit.
Open a Business Bank Account
Annual profits of bookkeeping businesses vary, however, you can make anywhere from $10,000 to several million dollars a year. It will all depend on how you manage and scale your business. To run a successful business, make sure your business stands the test of time so you can consistently get bookkeeping clients, you’ll need to engage in continuous improvement. By standardizing core processes, you’ll be able to better streamline your operations and ensure quality control when delivering client accounting services .
If you suspect you’re getting close to expanding, start looking! Give yourself time to find the right person and get them up to speed. You need to review the hours billed to each client and invoice based on those hours. Make sure you have time to complete the invoicing each month if you decide to bill hourly. If you got into virtual bookkeeping for the freedom and flexibility, you might want to work off retainers, but you also have the option to bill hourly.
Stay Up To Date to Grow Your Business
Bookkeepers often utilize business accounting software to help businesses with payroll, profit and loss statements, balance sheets, and other important reports. It might sound overwhelming to start from scratch, especially if you have no previous experience with running a business or even with bookkeeping, but we’re here to break the process down for you. Starting a virtual bookkeeping business won’t help you become an overnight billionaire. You’ll need bookkeeping insurance as you’re providing an essential service for businesses. General liability insurance protects you against claims made by unhappy clients and your employees.
Is bookkeeping a good side hustle?
Overall, bookkeeping is an incredibly flexible online side hustle. If you're interested in making an extra $500 to $1,000+ a month, bookkeeping is a solid fit, but it's also incredibly scalable if you want to grow it into a full-time business.