Starting a Bookkeeping Business
The fact that so many people dislike doing bookkeeping is good news for anyone who enjoys the ins and outs of financial record keeping. Lacking time or inclination, entrepreneurs and growing businesses often need help with their financial housekeeping despite the availability of easy-to-use accounting software. As one Los Angeles bookkeeper told us, "While doing business is getting more complex, people aren't getting better at handling their money. Today virtually everybody needs some professional guidance." Yet most small businesses can't afford to hire or keep full-time bookkeepers.
Independent bookkeepers are in demand even during economic downturns because businesses realize that if they aren't careful about their money, they soon won't be in business. As a result, bookkeeping can be a good business year in and year out. However, Adrian Seaford, who operates a New Orleans bookkeeping service, offers this admonition, "In downtimes, you may have more competition, because some accountants need more business to keep busy and will seek to pick up bookkeeping business." Accountants are no longer trained for small-business bookkeeping though, so even they are apt to outsource the bookkeeping work they get.
To be successful, independent bookkeepers need to be thorough, dependable and accurate as well as skilled in using accounting and sometime spreadsheet software. You must enjoy paying attention to details, and honesty and integrity are crucial. If you'd be tempted to go along with a client who asks you not to report or to hide income, it's best to look for another business because you won't last long in this one. A client who'll ask you to use questionable practices may have no compunction about not paying your bill.
If you've already done financial or accounting work for an employer, you're probably ready to take on clients on your own without special training. If you enjoy working with numbers but lack such a background, you can acquire the training you need to go into bookkeeping from a number of sources:
- Many community colleges offer courses in accounting and a growing number of colleges offer distance learning programs.
- The U.S. Department of Agriculture Graduate School offers distance learning courses in accounting. Call (888) 744-4723 for more information.
- Accountant Julie A. Mucha has distilled her experience into print and e-book form in the book How to Open Your Own In-Home Bookkeeping Service.
Start-up costs in this field are minimal, and most independent bookkeepers charge between $25 and $40 an hour. How much you can charge depends on your location and the level of work you do, ranging from minimal record keeping to virtually all the tasks leading up to preparation of financial statements. Some bookkeepers also prepare financial statements and do tax work as well.
Paul and Sarah Edwards are the authors of Best Home Businesses for the 21st Centuryand 14 other books.