Which Bookkeeping Software Should You Use?

I know the topic of bookkeeping software may make some of you want to poke your eyes out, but good bookkeeping really is very important to the success of your business.

Running a business involves making savvy money decisions and the only way to do that is to know where your money is coming from and where it’s going to each month.

Throwing your receipts in a shoebox and worrying about it at tax time is NOT a good way to run your business.

I’ve been a bookkeeper for many, many years for several different businesses, and the most successful businesses have a financial picture that they use to base future decisions on.

So how do you get that financial picture?

Well, you need to dedicate a little time to bookkeeping regularly, or better yet, outsource this to an outside bookkeeper, especially if you are completely accounting-challenged. You don’t need to be a CPA to do basic bookkeeping for your business each month, but you do need to have a grasp of how to apply income and expenses so that you can create a sound profit & loss each month.

If this bogs you down and causes you stress or frustration, I’d rather see you outsource it for a couple hundred bucks a month than ignore it – or do it wrong.

If you plan to go ahead and tackle this on your own for now, you may be wondering which software to use, so let’s chat about that.

Yes, you can plug everything into an Excel spreadsheet, but I don’t recommend that. Too much room for error and it doesn’t produce the reports you need to manage your business as well as give to your accountant at tax time.

Here are a few options you can consider…

QuickBooks Online

I personally recommend this option. It’s relatively inexpensive (subscriptions start at $12.95 per month),  you don’t need accounting experience (although having some knowledge is helpful) to use it, and it’s online, so you can use it from anywhere at anytime.

The other really handy thing with QBO is the ability to download your banking and Paypal information right into your QB file. That function will save you loads of time and headache.

I also like QuickBooks Online because you can  give your accountant access to your file so he/she can review your reports right online. You can also outsource the month end reconciliations to a virtual bookkeeper if you like. No transferring or uploading of files. Also, when updates are made to the software, you get them immediately with your subscription. No downloading or buying new versions. I love that!

If you go with this option and need a little help with it, be sure and check out the SBAB Premier and Platinum Membership where you can get some training on using QBO.

Bottom line: It’s a solid, easy-to-use, easy-to-share with your accountant, and an affordable option for small business owners. Note: If you need to run payroll through QuickBooks Online or track inventory, you will need to pay more for the service, anywhere from $40 – $60 per month, so the desktop version may be more cost effective for you.

QuickBooks Pro/Premier  –  Desktop Version

QuickBooks Pro (or Premier) is the desktop version of QuickBooks. You can buy it online, or go to your local office supply store and buy the software and load it onto your computer.

QuickBooks Pro does basically the same things as QuickBooks Online, but if you are investing in the software which starts around $200. Considering the software can last up to 3 years, that is cheaper than QuickBooks Online, but I prefer cloud-based options these days.

With QuickBooks Pro you can download banking information and create the reports you need in this version as well, but the file will live on your hard drive, so you’ll want to make sure you do backups.

It will also be a bit harder to share your QB file with people remotely, such as a bookkeeper or your CPA, but you always use a service such as YouSendit.com to transfer a QB file.

Bottom line: QuickBooks is the most used accounting software for small businesses, so it’s going to be the best overall solution. Your CPA or bookkeeper will most likely use QuickBooks as well which makes sharing your file with them pretty easy.

The desktop version works well, but if you are a small service-based business (no inventory or employees), the online version may be the easiest option for you. If you track inventory, or need more robust options, you may look at QuickBooks Premier or one of the more specialized versions of QuickBooks Premier.  You’ll also need to upgrade your software every 2-3 years or so and backup your QB file regularly.


I haven’t personally used Freshbooks, although I did sign up for a free trial and poked around in it a bit, but I have read up on the program and what all it offers.

Now keep in mind, software changes very fast and I know Freshbooks is also adding new features, but as of today, it’s not really a double entry accounting system. If you know accounting at all, you know what this means.

Freshbooks was primarily created as an invoicing system, making invoicing your clients easy and fast. But if you have an online business or retail business or you’re not invoicing clients regularly, this probably isn’t going to be your first choice.

Last I checked, you also couldn’t do bank reconciliations which I recommend each and every month.

Freshbooks does offer a free 30-day trial, so if you’re curious about it, check it out. And I believe they are trying to move more towards being a complete accounting software, but there are still some limitations.

Bottom line: Freshbooks is up and coming, but very limited as a full-on accounting program with bank reconciliations, accrual entries and more advanced accounting functions. If you need these things (which you probably do) you may want to look more towards QuickBooks. But keep Freshbooks on your radar, as I’m sure it will continue to add new features.


Outright has traditionally been a free, internet-based way for small business owners to track sales and expenses by linking their accounts to Outright and downloading the transactions. Outright now has a Plus version for $9.95/month with a few more options such as sales tax tracking, but you’re still not going to get all the functionality of something like QuickBooks.

Etsy shop owners and other smaller, internet-based retailers can use Outright for very basic bookkeeping, but again, it is very limited. It’s not setup for billing clients, although it does integrate with Freshbooks which does. You also don’t have the ability to do bank reconciliations or create accounts payables (pay invoices in the future). Outright produces a profit & loss statement and tells you what your estimated tax bill might be. As far as I can tell, that’s about it.

To be fair, I have not used Outright, but I know in general, it’s not a robust accounting software. And if you use the paid version of Outright for $9.95, you might as well pay an extra few bucks and go with QuickBooks Online for more features.

Bottom line: Outright may work fine for you, but it’s very limited and not a full-on double entry accounting software. You can always try out the free version and see if it covers what you need.

In Summary

There are other options out there like Wave and Zolo that you can check out, but I didn’t go into detail with them because my recommendation is to stick with a robust accounting software like QuickBooks.

I’m biased because I am a bookkeeper, but QuickBooks Online or QuickBooks Pro software is to me the best option because your tax accountant or virtual bookkeeper is most likely using QuickBooks and will be able to download or make adjustments right in your company file. Also, as your business grows, you’ll need a double entry accounting system, so might as well select based on where your business is headed.

But again, as I always say, this is MY opinion. Please use what works best for YOU.

What software are you currently using to do your books (or do you outsource this)? Share in the comments!



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