Again, the best course of action for you to take when setting prices is doing your research. Take a look at industry averages, rates by state, and more to get an idea of how much to charge your clients. When setting your bookkeeping services prices, consider how much should i charge for bookkeeping creating different tiers for the size of the client. The average hourly rate for bookkeepers in the U.S. is $20 per hour, according to Salary.com. The range swings from $18 to $25 per hour, and there’s a lot of room for growth beyond the $25/hour figure.
- The best way to do bookkeeping for small businesses is to come up with a framework, choose the method that works best for your business type, and keep track of all the details.
- Entering your busy season or dealing with employee turnover can distract business owners— resulting in inefficient infrastructure and plateauing growth strategy.
- It’s also important to make sure they have experience in accounting software you use.
- Keep in mind that this bookkeeping cost per month depends on your bookkeeping needs, where you run your business, and if you decide to hire an in-house bookkeeper or use online bookkeeping services.
- In a nutshell, a bookkeeper records your financial transactions and collects information to create general financial reports.
Look at the types of services you offer and compare what you currently charge to others. Do your research ahead of time to find average rates for services in your state. If needed, make adjustments to your pricing to reflect costs in your locality or state. There are major differences between the three types of bookkeepers and what each can offer your business. Figure out which works for your business and start tackling the problems, or potential problems, with your books.
I like to calculate my rate based on my max time, but then I’m rewarded if I work quickly and efficiently. To illustrate what a small client looks like, I’ll be using a preschool I do bookkeeping for that generates about $150k in revenue a year. This preschool employs six teachers and hosts about 100 students.
Depending on your industry, the size of your company, how many employees you have, and how long you’ve been operating, you may need more or less support. You can calculate the time spent on bookkeeping tasks and translate that into dollars. If you spend too much time on bookkeeping, it’s easier to hire a bookkeeper to keep track of your financial records, financial statements, and other elements. Hopefully, you now have a better idea of what bookkeeping services you can afford and which services come with a lower or higher bookkeeper cost. Consider investing in simple software like FreshBooks for additional help in handling your finances without breaking the bank. You must understand what bookkeeping services you need and whether it’s best to hire a professional bookkeeper full time, part time, or outsource the service.
Factors Influencing Hourly Rates for Bookkeepers
In-house accounting, on the other hand, gives you peace of mind knowing that someone you know and trust is handling your books and financials. The only drawback of paying a full-time accountant is that you may need to offer them employee benefits. After a few months of working at an hourly rate, you can send your client a proposal or contract, spelling out the tasks you will be doing and what the fixed monthly pricing will be moving forward. With my small clients, I do all the regular bookkeeping tasks, such as hooking their banks up to QuickBooks Online, categorizing all their transactions, and reconciling at the end of the month. However, for this client, I also do receipt management, which is probably the most time-consuming task I do for this preschool. A full charge bookkeeper has a larger responsibility and full oversight over a company’s finances.
With the right technology, you can automate bookkeeping processes and tasks that once took hours of your time. Marketing the services that add value to your clients outside of your typical responsibilities is a great way to increase revenue. In any industry, experience is influential in pricing decisions, and bookkeeping is no different. It means quality of service, efficiency, calmness, problem-solving, and confidence.
What is a full charge bookkeeper?
It may be time for you to make the executive decision of hiring a bookkeeper to take the reins. I also collect payments through their payment processing system. Payments come in electronically, and when they come in, I apply it to the patient’s balance.
Not all bookkeepers are equal in the types of services they offer, and this is often a major factor in how much you make per hour. The basic services are maintaining accounts payable and receivable, reconciling bank and credit card accounts, and generating monthly financial reports. What is the difference between small, medium, and large client accounts for bookkeepers? Let’s break down the different sizes to their revenue, employee numbers and other key metrics. Then we will compare this to the fixed-rate monthly pricing I charge for bookkeeping services along with the bookkeeping tasks I do for each one. My goal is to help you understand what these breakdowns look like for each client.
Most people don’t want the most expensive option, but they also feel dissatisfied with selecting the base option because it lacks certain features. Asking yourself these questions is vital to knowing the right bookkeeping pricing for you. Location plays an important factor in pricing, although less-so since the pandemic and the rise of remote work and cloud accounting.
Monthly bookkeeping fees can vary, so make sure to get an accurate estimate from the team or individual before signing on. Both have different rates and services, so doing your research to find the right solution for your business is essential! Let’s jump into the differences between basic bookkeeping and full service bookkeeping— and how to choose the best option for you based on your needs and budget. Not every business owner needs the same level of financial management services.
Accountants maintain a wide range of skill sets, including managing spending and budgets, taxes, and analysis of financial statements. To be exceptional at these tasks, accountants must complete years of training and earn special certifications, which their salaries reflect. Depending on the type of accountant, years of experience, and certifications, you could be paying a pretty penny. A strong alternative to hourly billing is fixed-rate (or flat-fee).
Receipt management
If your monthly average is $50,001 or more, the monthly price for QuickBooks Live is $400. If your monthly average is $10,001-50,000, the monthly price for QuickBooks Live is $300. If your monthly average is $0-10,000 per month, the monthly price for QuickBooks Live is $200. At your request, QuickBooks will conduct a full evaluation of your bookkeeper’s work.
Bookkeeping costs: Pricing considerations for bookkeeping services
Partnering with Patriot earned this accountant a 50% cost savings from his previous provider, decreased his time running payroll, and more! So, don’t be afraid to boast about your experience while marketing your accounting firm. And, use it as a competitive advantage when it comes to pricing your offerings. Smaller clients generate less revenue than medium or large clients.
Based on my research with fellow bookkeepers, there isn’t one (or two, or three) answers either. If you post them on your site, a potential client can choose your services like they’d choose a combo at a drive-thru. For another great article about using pricing bundles, check out this post over at FinePoints Bookkeeping. For example, https://simple-accounting.org/ calling the tax office to negotiate lower penalties on tax arrears may only take 15 minutes of your time, but could save your client thousands of dollars. The best way to do bookkeeping for small businesses is to come up with a framework, choose the method that works best for your business type, and keep track of all the details.
Don’t be fearful of having conversations about raising rates with long-term clients. If they value your relationship and the service you provide, they’ll understand why you make occasional and reasonable increases. As a bookkeeper, you can and should leverage your experience to increase your profit. If you’ve been working in the industry for 10 years, for example, you’ll have the client base, referrals, references, and body of work to quote a higher rate. With tech taking up so much airspace in modern accounting, those who are fluent users are quickly outpacing those who aren’t.