Quick Guide to Start Your Virtual Bookkeeping Business From Home
By Craig Cannings
Are you looking for a second career or side hustle that allows you to work from home? Virtual bookkeeping may be the perfect solution, especially if you love working with numbers!
Working as a virtual bookkeeper is an increasingly popular way to earn money, and it can offer financial stability while giving you the freedom of remote work. But before getting started in this field, there are some important things to know—like what tools to use, how to find clients, and how to stay organized with your time management.
In this blog post we’ll explore these topics so that by the end of it, you’ll have all the knowledge necessary for starting your own successful virtual bookkeeping business from home. Let’s get started!
Table of Contents:
What is Virtual Bookkeeping?
Virtual bookkeeping is the practice of managing financial records and transactions for businesses remotely. It involves recording, classifying, analyzing, summarizing, and reporting on a company’s financial activities. This type of work can be done from anywhere in the world with a secure internet connection (especially if you are dealing with your client’s financial information).
Services Provided by Virtual Bookkeepers
As a virtual bookkeeper, your responsibilities will include recording expenses, transactions, and revenue. You’ll also manage accounts receivable and accounts payable, reconcile general ledger accounts, prepare financial statements like balance sheets and profit and loss statements, process payroll, and prepare tax documents for employees or contractors.
Ultimately, you’ll provide these records to your client’s accountant.
Difference Between Bookkeeping and Accounting
Now you might be wondering what the difference is between bookkeeping and accounting. In our Virtual Bookkeeping course, we compare the two roles, so there is no confusion.
First of all, your role as a bookkeeper is transactional. Although you record data and create reports, you aren’t required to interpret the information or act as a financial advisor. Similarly, you may create tax documents, but you don’t prepare tax returns.
In contrast, an accountant acts as a client’s financial advisor, interpreting all data and reports. They also prepare financial statements, payroll taxes, and tax returns. In addition to these responsibilities, they can also perform all bookkeeping tasks.
These differences are important to keep in mind as you outline the scope of your online bookkeeping work with clients.
Benefits of Virtual Bookkeeping
The benefits of virtual bookkeeping are numerous. It allows business owners to save time and money by outsourcing their accounting needs to professionals who specialize in this field.
And here are some additional benefits:
– You have more flexibility as remote bookkeepers can work from home or any location.
– You have the freedom to work at any time that suits you best.
– You can serve clients located anywhere.
– You don’t need expensive office space or equipment since all data is stored securely online.
– You have access to great software, making it easier than ever to provide services.
– You can easily learn today’s bookkeeping software if you have a high school diploma (or higher education).
– It’s a fulfilling career if you enjoy working with numbers and helping business owners.
– Since the COVID pandemic, more business owners have begun trusting virtual professionals.
Virtual bookkeeping is an invaluable service for businesses, and a great opportunity for freelancers to start their own business. With the right qualifications and skills, anyone can become a certified virtual bookkeeper and begin providing services to clients.
How to Become a Virtual Bookkeeper?
Becoming a virtual bookkeeper is an attractive option for those looking to start their own business or side hustle. In fact, we list virtual bookkeeping as one of the top side hustles for 2023 in a previous blog post, “The Top Freelance Side Hustle Jobs for 2023.” The reason why is clear:
“Clients desperately need help managing the back end of their businesses. And if you currently work a nine-to-five job as an administrator, your transferable skills could be invaluable.”
To become a virtual bookkeeper, you must have the qualifications and skills needed to provide quality services. An administrative background is helpful, in addition to learning specific bookkeeping skills.
Qualifications and Skills Needed for Virtual Bookkeepers:
In order to be successful as a virtual bookkeeper, you need to possess strong organizational and communication skills.
You should also have knowledge of bookkeeping practices, financial analysis, budgeting, payroll processing, and tax preparation software programs such as QuickBooks, FreshBooks, Wave, Zoho Books, or Xero.
Additionally, having experience with Microsoft Excel will be beneficial in helping you organize your clients’ data more efficiently.
Three Steps to Becoming a Virtual Bookkeeper:
1. Learn Bookkeeping Skills.
One way to become a virtual bookkeeper is by completing an accredited program that offers courses related to bookkeeping and accounting practices. After completing the coursework required by the program, applicants must pass an exam administered by the American Institute of Professional Bookkeepers (AIPB). Once they are officially certified by AIPB, they can begin offering their services as professional remote bookkeepers.
But a formal certification is not always necessary. As we explain in our Virtual Bookkeeping course,
“With today’s technology, bookkeepers do not need formal training or degrees. Most usually have a high school diploma. It does, however, help to have some training and a basic understanding of numbers and math.”
At FreeU, we provide specific training so you can start your bookkeeping business with the required skills.
2. Create a Business Plan.
Before starting your own business, it’s important to create a plan outlining how you intend on running the business, including pricing structure and marketing strategies.
Additionally, building up some savings before taking on any clients will ensure that unexpected expenses or slow periods during which income may not come in right away can be covered without going into debt.
In our blog post titled, “The Ultimate 2023 Freelance Business Plan,” we also recommend starting with your “Big Why Statement.” You could say,
“I would like to build a Virtual Bookkeeping Business so that I can _____________________.”
Then, envision what you’d like to accomplish and turn your visions into goals you’ll reach at specific times of the year.
3. Define Your Bookkeeping Services.
Finally, make sure all contracts are written out clearly so both parties understand what services are being provided at what cost before beginning work together. As mentioned above, an understanding of the difference between accountants and bookkeepers will help clarify your scope of services.
Creating a freelance contract also helps maintain boundaries around your work so you can avoid scope creep and maintain a healthy relationship with clients.
By understanding the qualifications and skills needed, taking the necessary steps, and using helpful resources, you can start your journey towards becoming a successful virtual bookkeeper. Now let’s explore what tools are essential for success in this field.
What Tools Do You Need to be a Successful Virtual Bookkeeper?
Being a successful virtual bookkeeper requires the right tools. From essential software to hardware, online resources and apps, having the right setup is key to success.
Essential Software for Remote Bookkeepers
The most important tool for any remote bookkeeper is accounting software. This will be used to manage client accounts and financial records, so it’s important that you choose one that meets your needs and budget.
As we discussed above, popular options include QuickBooks Online, Xero Accounting Software, FreshBooks Accounting, Wave Accounting, and Zoho Books. Additionally, many of these programs offer free trials or discounted rates for new users.
Recommended Hardware for Working Remotely as a Bookkeeper
In addition to accounting software, you’ll need reliable hardware such as a laptop or desktop computer with an internet connection in order to work remotely as a bookkeeper. Make sure you have updated security and antivirus software on your computer to reassure clients that their information is safe.
It’s also recommended that you have backup storage solutions such as external hard drives or cloud-based storage services like Dropbox or Google Drive in case of data loss due to technical issues or natural disasters.
Finally, if you plan on working from home regularly, investing in ergonomic office furniture can help reduce strain on your body while increasing productivity levels over time.
Online Resources for Professional Development as a Virtual Bookkeeper
Having the right tools and resources is essential to being a successful virtual bookkeeper. In FreeU’s Virtual Bookkeeping course, you can access online course videos and handouts to learn new skills and upgrade existing ones. We also provide training and resources to help you market your business, onboard new clients, and interact with existing ones.
In our FreeU online community, you can post questions and seek support from mentors and fellow students. Many have worked as virtual bookkeepers and can share their insights.
Additionally, tools like QuickBooks Online provide video tutorials and webinars to help you master your skills. QuickBooks also offers an online community where you can post questions.
Above all, continue to seek professional development resources as your business grows so your services will remain current.
In the next section, we’ll discuss strategies for finding clients and promoting your services as a virtual bookkeeper.
How to Find Clients as a Virtual Bookkeeper?
Finding clients as a virtual bookkeeper can be a daunting task, but with the right strategies and tactics in place, it doesn’t have to be.
Networking is one of the most effective ways to find new clients. Start by reaching out to your existing contacts such as friends, family members, colleagues, or past employers who may need help with their finances.
You can also join online communities and groups related to accounting and finance where you can share your virtual bookkeeping services and connect with potential customers.
Additionally, consider attending local events that are relevant to your field so you can meet people face-to-face and build relationships. Your local Chamber of Commerce or sites like Meetup are helpful for finding events related to specific freelance niches.
Promoting your virtual bookkeeping business is another key factor for success when looking for clients. Create a website or blog where you showcase your skill set and experience in order to attract potential customers.
Additionally, create content such as articles or videos on YouTube that demonstrate your expertise in this area to help establish credibility among prospective customers.
How to Price Your Services as a Virtual Bookkeeper?
Finally, pricing is an important aspect of finding clients as a virtual bookkeeper since it will determine how competitively priced you are compared to other professionals offering similar services. Consider researching what others charge for similar services before setting prices for yourself; however, make sure not to undercut yourself too much.
In our Pricing Your Freelance Services course, we recommend first deciding what realistic income you’d like to generate each month before taxes, based on how many hours you expect to work. Then add up all your business expenses. Finally, research industry associations, blogs, online groups, and freelance or virtual assistant websites to see what others are charging.
A Forbes article titled “How to Start a Bookkeeping Business (2023 Guide)” also provides this advice:
“Talk to businesses in your area to see what they are currently paying for bookkeeping services. Talk to people in your network who are also bookkeepers and ask what they are charging. In doing so, you can get a good idea as to the range bookkeepers charge for services.”
Offer discounts or packages depending on the scope of work needed from each client so they get more value from working with you rather than going elsewhere—this could be anything from free consultations to discounted rates if they commit to long-term contracts, etc. But make sure you don’t undervalue your expertise by charging too little.
By using the strategies outlined in this article, you can be well on your way to becoming a successful virtual bookkeeper. Now let’s look at how to stay organized and manage your time effectively.
How to Stay Organized and Manage Your Time Effectively as a Virtual Bookkeeper?
When providing online bookkeeping services, it’s essential to stay organized and manage your time effectively.
Here are some strategies for staying focused and productive while working from home:
– Set up a designated workspace that is free of distractions.
– Break down large tasks into smaller chunks.
– Establish clear goals with deadlines.
– Take regular breaks throughout the day.
– Limit social media usage.
And here are some tips on setting up an efficient workflow system so you manage your time effectively:
– Automate repetitive tasks whenever possible.
– Delegate work when needed.
– Set aside specific times for emails.
If you’re looking for a way to make a reliable income from home and the freedom to set your own hours, virtual bookkeeping is an excellent option. With the right skills and tools, you can become a successful remote bookkeeper and find clients in great need of your services.
To get started, learn more about what it takes to be a virtual bookkeeper, understand the necessary tools, create an effective marketing plan to attract clients, and stay organized with time management strategies. Virtual bookkeeping can be challenging but also rewarding if done correctly—so don’t hesitate to give it a try.
Are you a freelancer looking to start your own business, find new clients, and take advantage of remote work? Freelance University offers the perfect solution. Our full-service freelance community provides courses, resources, and support to help equip you with the skills necessary for success in virtual bookkeeping.
Join us today and unlock your potential!