How Much Does a Bookkeeper Cost?
How Much Does a Bookkeeper Cost?
Running a business can be very stressful if you’re doing everything yourself. If you are the one supervising employees, managing finances, looking at inventories, and focusing on clients too, then you need to hire a bookkeeper to make sure your books are organized, which will eventually save you a lot of time and energy, as well as taxes. Hiring a bookkeeper is one of the best investments that can help you grow. It cannot only improve efficiency but will also track expenditure and increase revenue. Hiring a bookkeeper can really help you manage your business more effectively. So it is important that you know how much a bookkeeper costs. Let’s first take a look at the factors that can influence the costs of a bookkeeper.
Some of these are:
As a bookkeeper, professional experience is very valuable. No matter the degree or qualification, if a bookkeeper has been working practically, it will translate into higher billable rates. If a bookkeeper has been working for years, not only will he be better trained but will also be more confident in his skills which can greatly affect the average hourly rates for the bookkeeper.
If you become an industry expert, for example specializing in restaurants, trucking, etc, you can be even more valuable to these industries, since they require some unique knowledge and expertise, and you’re the one specialized in it.
Zip Recruiter conducted a survey that showed the average national hourly rate for a self-employed bookkeeper is $37, but these rates vary state to state. The rates vary from $29.21 per hour in Mississippi to $43.40 per hour in Massachusetts.
Your education can play a huge role in attracting potential clients. If you have the required education and specialization, it provides the clients with confidence in your skills and they’re willing to pay more. A bachelor’s degree is not enough to do bookkeeping. You are required to either have an associate degree or get some certifications in bookkeeping that you can earn in no time.
If you get certifications from the American Institute of Professional Bookkeepers (AIPB), QuickBooks ProAdvisor certification, or the National Association of Certified Public Bookkeepers (NACPB), you will increase your earning potential tremendously.
Types of Bookkeeping Services
Some of the most common bookkeeping services a bookkeeper provides are:
- Data entry
- Managing accounts payable and receivable
- Recording transactions and filing
- Preparing financial statements
- Basic payroll processing and management
- Bank account and credit card reconciliations
If you provide all these services, you can charge higher per hour. If you offer specialized services in addition to these mentioned, you can demand a higher rate. Hourly rates are dependent on the complexity and time of the service provided, thus you can ask for greater pay if you have the ability to finish the required services with efficiency.
Accounting Software used
One of the defining factors in pay is the expertise of a bookkeeper in using various software. If you are using good cloud-based software, you can charge more per hour since they make accounting easier and reduce your time.
Frequency of service
The pay rates also depend on the frequency of service that you provide to your clients. Some clients you work for just once, whereas some you work for on a monthly, quarterly, or annual basis. Ideally, you charge the clients you see once or on an annual basis more than the clients that you work for regularly. This is because regularly working for the same books means less work to do and fewer changes to be made.
Bookkeeping clients are typical of four types that require:
- One-time service
- Monthly service
- Quarterly service
- Annual service
How Much Do Bookkeepers Charge?
The bookkeeper cost varies depending on the size of the business and the financial services that are required of them. In-house bookkeepers charge approximately $18-23 per hour depending on their personal qualification, experience, and the services needed. Whereas outsourced bookkeepers charge approximately $99 per month.
Cost of an In-House Bookkeeper
Large firms and well-established businesses often keep bookkeepers as permanent employees to effectively manage their books. However, small and medium-sized companies cannot always afford to hire an in-house bookkeeper. For them, freelance bookkeepers or finance firms are a better option to manage their books more cost-effectively. Hiring an in-house bookkeeper provides you with the advantage of having the full-time attention of your bookkeeper on your finances and you can have more control over how they work and what they work on.
The average hourly pay for an in-house bookkeeper in the US is $20 but the rates can vary from $18 to $23. However, on top of the fixed salary, you also need to pay your bookkeeper some additional costs that include employee benefits, payroll taxes, training, and equipment costs. According to the US Small Business Administration estimates, the actual cost of a full-time employee is typically 1.25-1.4 times the fixed salary.
Some benefits of an in-house bookkeeper are:
- Bookkeepers answer directly to you
- Efficiently handle the books for a larger business
- Available all the time
Although an in-house bookkeeper can provide you with more control and attention, outsourcing your bookkeeping to an external party means that you’re only paying for the work they do and not the cost of an extra employee. You also have greater flexibility in choosing your hours and if you want to switch between bookkeepers.
Cost of an Outsourced Bookkeeper
If you work with an outsourced bookkeeper or hire outsourced bookkeeping services, you will have a team of bookkeepers for managing your finances. Working with an outsourced bookkeeping firm might sound overwhelming at first, but it will provide you with access to a team of professionals that have the experience and bandwidth to meet your requirements in an extremely cost-effective manner, offering you a simple solution that can greatly help your business grow.
The costs of outsourced bookkeeping depend on the agency you hire, the services they provide, and your required needs. Professional bookkeepers at My Count Solutions optimize the process for you by managing your cash flow, accounts, finances, preparing financial statements, and filing your taxes for you, while you can focus on the efficient growth of your business. For complex bookkeeping needs, the pricing at MyCountSolutions starts at $325 per month and if pre-paid annually it is $300 per month.
Some benefits of hiring an outsourced bookkeeper are:
- Saves times
- More professional services that give business owners some peace of mind
- No need of training the staff
- Integrated tech solutions
- Remote access and mobility to your account and bookkeepers
- Advanced security for the protection of business’ financial data
- Centralized account management
- Tracking for improvement and insights
Outsourced bookkeeping can also include virtual bookkeeping where bookkeepers can work from any location, and since they don’t have as many expenses, it automatically lowers the wage they demand. If you are not limiting yourself to a bookkeeper who works locally, you can find the best-suited bookkeeper for your business regardless of where they live. Some advantages of hiring a virtual bookkeeper are:
- Saves your time
- You can securely store your data in the cloud
- You can access your financial data anywhere anytime
- You don’t need to meet bookkeepers in person and can chat online
- Online banking saves you any hassle
Hourly Pricing vs Flat fee Bookkeeping costs
Bookkeepers either charge you hourly or at a flat rate depending on the type of financial expertise your business needs. Hourly sounds like the cheaper option in the beginning but it might not be the case.
You need to figure out the hourly and flat fees in order to determine what is best for your business.
This is a great option especially when you need help with your books occasionally only. A bookkeeper might be hired on a per-project basis and they can be paid for the time they agreed to spend on the project. This way, it is easier to control your bookkeeping costs but it might be harder to manage since growing businesses require consistent updating of books.
This is a simple option that allows you to determine a set price for an unlimited amount of work. Bookkeepers have their busier months and months when they are completely free. However, setting a fixed price makes it easier for you to manage other business finances whilst making sure that your books are consistently organized.
At MyCountSolutions you can opt from four different plans depending on your monthly expenses, starting from $300 per month going up to $450 per month, which can easily be covered if the revenue you generate is over $50k per month.
How can My Count Solutions help?
Bookkeeping experts at My Count Solutions provide simple and easy bookkeeping for you in a straightforward manner optimizing the process for you and managing finances, accounts, cash flow and preparing financial statements, and filing your taxes for you. You can start off with only a consultation and if you feel like you need help with your finances and financial statements, MyCountSolutions is just a click away. Bookkeeping services are provided to you at a fraction of the cost in an easy and efficient manner. At MyCountSolutions, the services offered are:
- Financial consultation
- Run business smoothly
- Remote bookkeeping
- Zero tax filing stress