Automated Bookkeeping Tools Benefit the Self-employed

Aug 31, 2022
Automated Bookkeeping Tools Benefit the Self-employed

Millions of Americans identify as "self-employed," and many of them work by themselves with no other employees. Freelancers and self-employed professionals have specific bookkeeping needs that not only take up a lot of time but can also be complicated to those who are not financial professionals. Online software programs have come along to take a lot of the time—and guesswork—out of bookkeeping for freelancers and other self-employed professionals who have very specific financial management needs. There is a plethora of online accounting programs on the market, and spending a little time evaluating which one best suits the particular needs of your business can be a positive step toward streamlining and organizing the finances.

Bookkeeping features self-employed professionals should prioritize when evaluating online services:

Sorting expenses

Many self-employed people work from their homes and integrate some of their business finances with their personal finances. It is generally advisable to have a business checking account that is separate from your personal one, but not all self-employed professionals opt for that. People who are running small operations or just getting started tend to intermingle their business and personal funds and use personal credit cards for business expenses and supplies. The overlap of business and personal transactions can quickly lead to disorganized bookkeeping in which a lot of time must be spent each month, quarter, or year sorting out personal expenses from business expenses; mixing the money in a single bank account makes it difficult to budget for the business and keeps you from seeing an accurate picture of how much cash your business has on hand at any given time. Any automated bookkeeping tool that a self-employed individual is considering should have good expense sorting features that allow you to categorize business charges, expenses, and payments as soon as you make them and to import expenses from your bank account so that they are clearly differentiated from non-business expenses. Online bookkeeping software that identifies and imports your business transactions gives instant organization to your records and gives you a clear picture of your tax-deductible business expenses.

Preparing taxes

Professional tax services are not always affordable to self-employed professionals—especially those who is just starting out. Online automating bookkeeping software can assist greatly in tax preparation by maintaining records of expenses that may be eligible for tax deduction. Online storage options that allow you to scan and upload receipts reduce the paperwork that clutters offices and give instant fingertip access to the records and proof of payment you need when calculating your business expenses. Selecting bookkeeping tools that offer uploaded receipt storage or that integrate with the program you already use will streamline your financial records and simplify the tax preparation.

Forecasting for the future

The self-employed professional cannot really gauge the financial success of the business without accurate records that lay out in black and white how much money has come in and how much has gone out. Online bookkeeping software that produces accurate financial reports saves a lot of time and gives up-to-date data about the financial health of the business. Having a clear overview to analyze helps self-employed professionals make better, more data-driven decisions about future investment and expansion opportunities.

Secure and sophisticated bookkeeping and accounting tools are no longer just for big companies; freelancers and other self-employed professionals can access quality, customizable services without paying for a lot of unneeded features. Online check services can be a helpful and low-cost add-on to bookkeeping software for freelancers. If most of your business is done at home, you can use your regular office printer to create legally viable checks in only a few clicks. If the majority of your work is done on-the-go or from multiple client offices or homes, you may not always have access to a printer and mailing supplies. Checkeeper can do that work for you, as well, including the stamping and mailing.

Checkeeper features help streamline bookkeeping for freelancers and self-employed professionals:

· A registry that records all payments

A record of all checks issued through Checkeeper are automatically stored and the registry can be searched by any field in the check.

· Syncs with popular accounting products

Checkeeper works compatibly with most of the popular accounting software programs that cater to small businesses and solopreneurs. Adding your Checkeeper account is simple and it instantly allows your printed and/or mailed checks to be recorded and categorized appropriately.

Freelancers have specific bookkeeping needs, and online software products can help untangle the business spending from the personal, thus simplifying tax preparation, saving time, improving accuracy, and enabling better data-driven decision making about the future.