Outsourced Bookkeeping – The Ultimate Guide to Hiring a Bookkeeper

If you’re running a small business, it’s hard to focus on marketing, quality, customer relations, vendors, and accounting. The word “hard” can even be switched with “impossible”. There’s a reason there are over 1.7 million bookkeepers across the US helping small businesses just like yours.

Well, with outsourced bookkeeping available to you, it’s very important to know why you need it, what it costs, and what you should look for. Let’s talk about that.

Why You Should Hire An Outsourced Bookkeeping Team

Let’s briefly discuss why you should consider hiring a bookkeeping team from outside your company. We all know that bookkeepers play an essential role within almost any company, so choosing the right people for the job is important.

If you find the right bookkeeping team, you will take a lot of stress off your back and you can even get insights into where your money is going and where you can save. If you’re trying to scale your business, this is invaluable.

Managing a small business isn’t easy. Taking some of the burden of an IRS audit, profit tracking, and business analysis off your shoulders is worth every penny you spend on those services. The thing is, those are just a few examples of the benefits. There are plenty of other reasons to hire bookkeeping services.

Outsourcing these services has several benefits, too. Not having to go through onboarding processes, limiting overhead costs associated with employment, and having a reliable location where that information is stored. If you’re looking to hire a freelancer or a bookkeeping company, they can be easy to vet.

What Services Do They Offer?

So, what do bookkeepers do? Bookkeepers play the important role of tracking your finances and creating insightful financial statements to help you make more informed decisions regarding your company’s money.

It’s common for these services to track your bills, follow your credit statements, and protect your financial data in a secure location for only you and your team to access.

They should make sure your books are always kept up to date and that the proper technology is being used, and they should be able to provide accurate and regular financial statements to your investors and management team.

How Does It Work?

You will be working with a team of dedicated professionals who work in tandem to get you the results you need. You’ll have a dedicated account manager, who will be your main point of contact, and they will connect all of your financial accounts and pull all of your financial data into one platform. 

From there, a team of accountants and bookkeepers will work together, using the right software, to record and track all of your business spending and earnings.

You’ll then receive financial statements once a month with personalized insights into where your company’s money is going. All of this will be done conveniently behind the scenes without even knowing it.

Throughout the ongoing process, you will always be able to contact your account manager with any questions or concerns that are brought up, and you can always request greater insights into your finances. You’ll also be able to discuss alternative services the company may be able to offer you.

Average Cost Of Outsourced Bookkeeping Services

You may be wondering; how much do bookkeepers charge? The cost for a bookkeeper will change dramatically based on a number of factors, including location, experience, education, and employment status. However, the average hourly rate for a bookkeeper is just over $20.

This doesn’t necessarily mean you should expect to pay that. Let’s compare some of the costs you should expect to pay depending on who you hire.

Freelance Bookkeeper

A qualified bookkeeper who is operating independently will likely charge more. They will have to pay their own taxes, purchase their own insurance plans, manage their business expenses (possibly including an office), and support their lives.

The $20 figure we mentioned is if you are employing a bookkeeper, meaning they receive a W2 tax form. In that case, $15 to $25 is a reasonable hourly rate. However, for a qualified, independent bookkeeper, whether they work remotely or in person, you should expect to pay anywhere from $25 to $40 for their services.

The cost will also depend on the location. Whether you’re hiring remotely or within your area, someone working in Boston is bound to charge more than somebody in Omaha.

Lastly, the type of experience will play a role in figuring out the cost. If you are in real estate and you’re looking to find a professional real estate bookkeeper with 10 or more years of experience in the field, you will be paying more than a standard bookkeeper who just received their certification.

Outsourced Bookkeeping Services

When you hire a bookkeeping team as opposed to one individual person, the cost will be shared among other people using their services, making it more affordable and more convenient for your business with a completely different pay structure.

If you’re expecting to pay $20 to $40 an hour for these services in-house, you’ll be surprised to know that outsourcing your bookkeeping services can cost you as little as $500 to $2,000 a month depending on the size of your company and number of transactions!

What To Look For In A Bookkeeping Service

Okay, you know the benefits of hiring a bookkeeping team and what you should expect to pay for their services. Hiring a bookkeeping team is a serious decision that you can’t take lightly, so you need to know what you’re looking for.

There are a few key things to verify before deciding to move forward with a prospective bookkeeper, so let’s talk about a few good places to start.

References

One of the first things you should ask for is references, as they are even more important than their resume. Somebody could have all of the experience and education in the world and still be a nightmare to work with.

They may also have a history of overcharging or trying to scam. Checking a bookkeeper’s references is a great way to make sure you’re getting the right people to handle your financial records. Ask questions about their services, see if there were any major billing issues, and ask about their history with each company.

If you’re hiring a bookkeeping company, read their reviews and ratings online to see if their services meet or exceed your expectations and needs. Check with the Chamber of Commerce or on their website for reviews to make sure they are legit.

If you’re paying by the hour, ask about timeliness. Remember that a team of bookkeeping professionals is unlikely to waste time as they have other clients to tend to.

Qualifications

There are a lot of different ways a bookkeeping team can meet qualifications, and it’s not as simple as a certification or experience.

Look into the website’s accreditation first before you make any judgments. However, you may be looking for something serious. This is your business’ finances you’re putting into somebody’s hands, so you want to make sure they are qualified.

Experience definitely matters in the field. Look into how long the company has been around, read a little about the founder or founders, and see if their team is up to the standards you need.

You may also want to know if they’re qualified to handle your specific industry. If they have experience handling similar businesses to yours, that’s always a plus!

Services Offered

Different bookkeeping teams may offer your company different services. Some may have a niche in your field, so look for experience in your industry if you need it. A bookkeeper with experience in a marketing firm won’t likely know some of the hidden costs associated with a construction company, and they may not be able to offer as great of insight because of it.

If the bookkeeper is with a firm, do they offer audit protection services? If you’re working in real estate, does the applicant have experience in the field? Maybe you want franchise bookkeeping services. Ask about all of the services they offer and see if it fits your needs.

Some may offer services beyond just bookkeeping. You may be looking for a virtual assistant to help you with marketing or other services on top of accounting. However, there really is no substitute for the quality a bookkeeper, especially one with experience in your field, can offer. They may even be able to offer you some personal finance tips!

Cost

Keep a number in mind of how much you would ideally like to spend on these services. Keep a lower number in mind for somebody with the minimum qualifications you would accept and a maximum amount for somebody with the ideal qualifications and experience.

Let’s say you’d be willing to pay a new bookkeeper who just finished their accounting education $20 an hour and an experienced bookkeeper with outstanding references $40 an hour. Once you have these figures in mind, ask each applicant about their prices and preferred payment methods.

Remember, you get what you pay for. Paying that $40 per hour is not necessarily a bad thing. It may even be ideal. This prospective bookkeeper will be managing your company finances, which is an invaluable service that will keep your company afloat and (ideally) take a lot of stress off your back.

 

Reliability

Your company has a unique schedule with unique needs. Make sure that if you’re outsourcing a bookkeeper, they can meet your company’s needs. Freelancers may have busy schedules with other clients, they may have crazy travel plans, or more.

You want a team that you can call day or night to get information when you need it, and you want to know exactly when to expect your regular statements.

Ask about how booked their schedule is and be very upfront with them about what it is you need. If you’re looking for somebody to do 20 hours of work for you every week, some freelancers won’t be able to offer you that. It’s best to get that out of the way as soon as possible.

If you find a team of trusted bookkeepers or an outsourced network of them, make sure they have quality hiring standards and are able to take on the workload that your company needs.

There are also plenty of other questions to be asking in terms of reliability, and you should be asking both the team and their references about them. Again, this is the heart of the company you’re putting somebody in charge of. You need to be able to trust them.

Attention To Detail

Finally, bookkeeping is all about getting into the weeds. You need a reliable bookkeeping service that is detail-oriented, organized, and prepared to take on various challenges related to your financing. There are a lot of moving parts involved in financial management, and the IRS can be ruthless. Make sure your new hire has a keen eye for detail. This isn’t a place to cut corners.

A talented, detail-oriented bookkeeper who is reliable, has good references, and has the right experience is worth their weight in gold to your company, so don’t make any sacrifices.

Now that you know what to look for in outsourced bookkeeping services, start searching today! Don’t sacrifice quality, be diligent in your vetting, and find the right bookkeeper for your company so you can keep growing your business.

If you’re interested in a team of highly skilled bookkeepers for your small business, schedule a free consultation with us today to get you the help you need, and stay up to date with our latest accounting news!

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