Bookkeeping. It’s a word that sends a shiver down your spine if you’re self-employed or an entrepreneur. The thought of having to do all that number-crunching on a regular basis is not most people’s idea of fun. A lot of freelancers and business owners don’t have the resources to hire a professional in-house to do all their accounting and invoicing.
FreshBooks was born out of that need to make accounting a lot easier for small businesses. The software’s main goal is to make bookkeeping easier so that you can use all that time you save on actually running your business. It has also evolved to provide tools that automate certain small business processes and provide financial insights to help businesses make better decisions.
Most business owners have considered a software tool like FreshBooks to help with their accounting. Read our review to find out everything you need to know about this one.
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FreshBooks Review 2020
FreshBooks was created by Mike McDerment, who is now the CEO of the company. The idea for the product came from his own experiences as a small business owner. Back in 2003, McDerment ran a small design agency. It was during that time that he realized how hard accounting and invoicing is for small business owners.
Tools like Microsoft Word and Excel were no good in trying to generate professional looking invoices. Then one fateful day McDerment overwrote the date on an earlier invoice and lost all the existing information on it. That’s when he decided to take matters into his own hands. McDerment went into a coding frenzy for two weeks and came up with the first version of FreshBooks.
FreshBooks has since gone from that one-man operation to a team of 300 full-time employees working out of the company’s Toronto offices. A whopping 24 million users from across 160 countries have turned to FreshBooks to help with their bookkeeping. The tool saves people as much as 192 hours of time otherwise spent on accounting on an annual basis.
FreshBooks started off as a tool just to help with small business accounting and invoicing. And it does that with aplomb. You can’t go wrong using FreshBooks to generate invoices and do all the bookkeeping that comes with running a business.
But that’s not the only thing that FreshBooks does. Over time, it has added more and more tools to its arsenal, making it a holistic tool to handle various small business processes. That includes things like time tracking, project management, team collaboration, payments, and financial analytics.
The software itself is a cloud-based solution. So you don’t need to worry about having to manually download updates or losing data that was stored locally. All your data is constantly synced to the cloud and stored in a secure manner. And you can rest assured that you’ll never lose a version of an invoice like Mike McDerment did back in 2003.
There’s also a mobile app that you can use to tap into FreshBooks when you’re on the move. You can send out invoices and record expenses right on your phone. This makes the overall experience of using the software a lot smoother.
As we saw earlier, FreshBooks started out as just accounting software. But it has since become a lot more than that. You can use the tool to run many different aspects of your business and gain insights into it that you need. Let’s take a look at all the various features at your disposal as a FreshBooks user.
The most basic bookkeeping ritual that you have to undertake regularly as a business owner is generating invoices. FreshBooks has an invoice generator to make it simple to create professional invoices quickly. You can customize your invoices by throwing in things like your logo and the content of the email that accompanies the invoice.
FreshBooks also helps with receiving your payment for invoices. Your clients can pay using their preferred payment method, which means that you get your money faster. You can also request an advance deposit on your invoice if you would like to be paid a part of the amount before you deliver the final product to a client.
The software can be set to send out payment reminded to customers on an automated cycle. That way business owners don’t have to hound their clients for payments. You can also have FreshBooks apply a late fee automatically for defaulting customers.
Invoices help you get money into your business. But accounting also necessitates having to track money that goes out of the business. FreshBooks has all the features you need to track your business expenses.
Having to manually enter every expense can be a time sink for business owners. Thankfully, FreshBooks can connect to your bank account or credit card directly and automatically track all your expenses. The software updates your expenses on a daily basis based on account statements coming from your bank account.
You can digitize all your receipts using FreshBooks. All you need to do is take a picture of a receipt and put it under a certain category if you want. The software logs all these receipts on the cloud in an organized fashion. All of this will make filing your taxes a breeze.
Now let’s talk about what the actual accounting process looks like in FreshBooks. The software uses a system of accounting known as double-entry bookkeeping. This is a system that requires that for every entry made in one account, another account needs to be updated with a corresponding entry. This system ensures that the credit and debit tables of a business are always matched.
Most business owners don’t do all the accounting for their business themselves. FreshBooks lets you add your accountant as a user to your account with a few clicks. The accountant can access all the information on the account so that it’s easier to do things like filing taxes.
Before you can go ahead and invoice a client for a project, you have to set your price. And in order to do that, you have to set the expectations for the project and send out an estimate. FreshBooks can help you do that with its estimation tool.
You can create proposals for projects right within FreshBooks. These proposals can include details like the overview of the project, a scope of work, timeline, deliverables, and the estimated billing amount. Once the client gives you the green light, you can kick off the project.
Billing a client is a lot easier when you create proposals from within FreshBooks. You can quickly turn your proposal into an invoice using the same itemized deliverables and estimate. That means you get your invoices out the door faster and receive your money faster, too.
5. Time Tracking
Tracking time is an important undertaking whether you’re a small business owner or freelancer. It’s a way to track your billable hours as well as your own efficiency in executing a project. You can use FreshBooks to track the time you’ve spent on projects and generate invoices for them instantly based on the accrued time.
The software automatically generates insights regarding your work productivity. You can view how many hours you spent per task on a day-to-day basis. All you need to do is start a timer within the tool and FreshBooks does the rest.
There are a few different ways in which you can use the FreshBooks time tracking tool. There is a FreshBooks Chrome extension that you can use called the FreshBooks Chrome Timer. You can also trigger the timer from existing apps that you use for project tracking such as Asana, Teamwork, and Trello.
The time tracking tool doubles up as a great way to stay on top of your team’s performance and progress. You can view which tasks each team member has performed and how long it took.
6. Project Management & Collaboration
FreshBooks has a range of features that help with managing different projects and helping your teams collaborate better. Small businesses often work with a combination of in-house staff, contractors, freelancers, and business partners. It’s essential to keep information flowing freely and ensure that it’s always up to date.
FreshBooks has a web-based dashboard where all the members in your team can upload all files relevant to a particular project. That means you don’t have to dig through email chains to find certain attachments.
You can invite different people in different capacities to your FreshBooks account. For example, you can invite someone as a contractor or as a client, giving them different permissions as a result. When you add clients to your account, they can easily give feedback on projects and stay updated with their progress.
Using FreshBooks also makes life a lot easier for your clients. They can pay online just by clicking a link within the invoice. FreshBooks records the payment and accounts for it in your books.
FreshBooks has a built-in dashboard for reports and analytics. This is a centralized location on the Web where you can see all the key data regarding the financial transactions – both credit and debit – that your business has undertaken. The data is visualized in the form of charts so you can easily spot trends and interpret stats.
FreshBooks users can import different reports from the software as and when they need them. That includes profit and loss statements, expense reports, and sales tax summaries among other things. This is especially useful for when tax season rolls around since you’ll be able to access all your tax-related data with a few clicks.
Who is FreshBooks For?
Now that we know what FreshBooks does, let’s understand who it’s for. This software has been designed keeping a few different kinds of professionals in mind. Here’s who can benefit most from using FreshBooks for accounting and invoicing.
Usually freelancers don’t spend a lot of time thinking about maintaining their books or accounting. But you can both grow your business and save money in things like taxes by taking a more pointed approach towards your finances.
FreshBooks can help in that regard because it makes it very simple for individuals to track their expenses and income. The mobile app can log all your bills and automatically generate income and expense statements. This can be helpful when it comes time to file your taxes.
Another useful feature that FreshBooks offers for freelancers is the time tracker. This one is available both within the mobile app and as a standalone Chrome extension. So you can easily track your billable hours no matter where you’re working from. The software generates invoices automatically based on the number of hours logged by the time tracker.
When you run a small business, there’s always a hundred different things to attend to. Being able to simplify or automate any of your tasks can feel like a huge burden off your shoulders. That’s exactly what FreshBooks makes possible when it comes to accounting for small businesses.
FreshBooks makes it easy to maintain your accounts even if you’re not someone who is an expert in that domain. If you do need to bring an expert in to help, FreshBooks makes it simple to give your accountant access to your account. Your accountant can come in and do some of the more intensive bookkeeping processes such as filing taxes.
Another benefit of using FreshBooks as an entrepreneur is that it can help you manage projects and your team. The software has in-built tools to create proposals and generate invoices. In that sense it can be an end-to-end solution to win clients and then get paid when you complete a project.
The reports that FreshBooks generates can help you make better decisions for your business. These are insights that you would usually have to do a lot of number crunching to arrive at. The software makes it simple to get the same business intelligence with just a few clicks.
FreshBooks integrates with a multitude of tools spanning many different app niches. Below are some examples.
- Klipfolio: Create real-time dashboards using over 100 pre-designed visualizations. You can have the dashboard automatically update for things like adding a new client in FreshBooks, adding an invoice or expense, and entering a new payment.
- ClicData: Use a dedicated connector to route data from FreshBooks to ClicData. This business intelligence platform provides a data warehouse and other tools required to cleanse, merge, and transform data.
- Roger.ai: This is a tool to automate processes such as compliance, approvals, and expenses. Once integrated with FreshBooks, you can have Roger automatically make payments, make approvals based on certain conditions, and scan bills and receipts to upload to your accounting system.
- WooCommerce: WordPress users will be happy to know that FreshBooks has a WooCommerce integration. This makes it possible to quickly have the financial data coming in through your online store makes its way to your accounting software. So you can do things like automatically generate invoices when an order comes in and create new items in your FreshBooks invoices when you add new items on your WooCommerce store.
- Podia: Podia is a platform where you can sell digital downloads and online memberships. You can connect the tool to FreshBooks using Zapier. By doing so, the data on your Podia will automatically sync with FreshBooks so that your sales automatically map onto your accounting software.
- SquareSpace: You know of SquareSpace as a tool that can help you build websites without having to code them. It can also work as an e-commerce platform if you need it to. You can sync your SquareSpace website with FreshBooks to bring in data regarding your products, orders, and sales.
- Asana: This is a popular project management tool, especially among tech teams. You can make the FreshBooks time tracker a part of your workflow on Asana. The work logs on FreshBooks can be channeled into Asana easily so that you can manage your projects and teams better.
- Insightly: You can use Insightly’s capabilities as a CRM to bolster your business in combination with FreshBooks. You can also use it to create sales pipelines and monitor projects – both existing ones and upcoming projects for which you need to create proposals and estimates.
- Clio: This one’s specifically for lawyers and law firms. Clio is a software that helps law firms manage their practice in an efficient manner. You can connect your Clio account to your FreshBooks using Zapier. Once that’s done, you can use insights from the accounting software to better manage your law firm on Clio.
Below are some of the features that are included with all FreshBooks plans:
- Generate professional-looking invoices using templates
- Send prospective customers project proposals and estimates
- Accept payments for invoices using online transaction methods
- Business insights in the form of reports and analytics
- Secure data storage in the cloud accessible anywhere
FreshBooks is free to try for 30 days. If you choose not to upgrade after that period, your data can still be stored on the cloud in case you do decide to pay at some point.
The paid plans start at just $4.50 for five billable clients. Adding additional team members costs $10 per member.
FreshBooks’ Plus plan lets you have up to 50 billable clients. Automated recurring invoices, late fees, and client retainers are some of the additional features that you get with this plan. It costs $7.50 per month.
If you want to go up to 500 billable clients, you will have to pay $15 per month for the Premium plan. The advanced payment features will cost you an additional $20 per month.
If your business has reached a stage where it has more than 500 billable clients, you will have to go with a custom pricing plan. FreshBooks gives these customers a dedicated account manager and a training plan for you and your entire team.
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However, the truth is that FreshBooks does not offer any coupons! But FreshBooks is currently running a 60% Discount sale due to Covid-19 to help small businesses out!
FreshBooks Review – Final Thoughts
To say that FreshBooks is a godsend for freelancers and small business owners would not be an overstatement. There’s a reason this has become one of the most popular accounting softwares across the world. Its ease of use and diverse feature set make it an easy choice for entrepreneurs.
If you’re completely new to the FreshBooks ecosystem, you shouldn’t have too much trouble migrating your business data onto it. The interface is intuitive and the tools are easy to figure out. Once you’ve done the initial setup, it’s simple to keep your financial data up to date on the software. That’s thanks to features like its mobile app, receipt storage, and automated double-entry accounting.
FreshBooks may not be the right choice for you if you’re a large business that has complex accounting needs. The software does not offer more advanced features like tax estimates or inventory tracking. But if you’re a small business, you can’t do much better than FreshBooks.