Bookkeeping is a vital process of every business that is aimed at keeping financial records orderly and up to date.
As a business owner, freelancer, or manager, outsourcing bookkeeping services helps you take control of your finances.
But how much does a bookkeeper cost?
The answer can vary greatly because of many reasons such as the location, level of experience, and if the service offered is basic or advanced.
Types of Bookkeeping Services
The cost of hiring a bookkeeper depends on the service model type, as there are different ways to go about it:
Freelance Bookkeepers
- Hourly charges for freelance bookkeepers range between $20 and $100 based on experience. Some may also offer flat monthly rates.
- Packages range between $200 to $2,500 based on the complexity of the business.
In-House Bookkeepers
- When hiring a full-time bookkeeper, benefits and salaries must be paid to them.
- For in-house employees, the average bookkeeper’s pay is somewhere between $40,000 to $65,000 a year, plus additional expenses such as benefits, payroll taxes, and an office.
Online Bookkeeping Services
- Due to convenience and low cost, many companies opt for this method, so these services have become popular among businesses.
- These services charge anywhere from $200 to $800 depending on the scope of services required.
- EasyBooks, QuickBooks Live, Bench, and Pilot are some online bookkeeping services that stand out from the rest.
Certified Public Accountant (CPA) For Bookkeeping
- Bookkeeping tasks can be performed by CPAs, but their services come at a premium due to their advanced level of training.
- They charge between $150 and $450 an hour, which makes sense for complicated financial management.
Key Components that Determine Bookkeeping Rates
Scope of Services
Fundamental Bookkeeping: Basic services such as data entry, bank reconciliations, and ledger management are included.
Their professionalism is the bare minimum and, hence, their services are usually very cheap.
Comprehensive Bookkeeping: Financial and payroll planning, reports, tax preps, and financial consultations are some of the higher-level services that are provided. Their pricing is higher due to the level of skill set needed and the level of service provided.
Experience and Qualifications
Novice Bookkeepers: Individuals new to the field may charge less because of their lack of experience.
Competently Certified: Bookkeepers with credentials such as CPA or CB possess greater command of the subject and often charge premium fees.
Business Size and Complexity
Small Scale Enterprises: Their limited activities mean less attention is required towards bookkeeping, resulting in lesser expense.
Corporations: A greater focus is needed on bookkeeping due to an increase in activities and transactions, making the service costlier.
Geographical Location
Urban Areas: Places such as New York and San Francisco are costly to live in, hence the fees in bookkeeping tend to be higher than average.
Rural Areas: Bookkeeping services are offered at comparatively cheaper rates in small towns and almost rural areas due to a low standard of living.
In-House vs. Outsourced Bookkeeping
In-House Bookkeeping: The employment of a dedicated bookkeeper comes with the cost of the salary, benefits, and other indirect expenses.
Outsourced Bookkeeping: Using external service providers or firms can improve flexibility and save costs because of no indirect expenses. Instead, the payment is made for the services provided.
Average Costs of Bookkeeping Services
Knowing the average costs of bookkeeping helps in planning the budget accordingly.
Hourly Rates
Freelance Bookkeepers: Freelancers charge between $25 and $60 depending on the location and years of experience.
Certified or Specialized Bookkeepers: Certified professionals tend to charge a premium and the fee is somewhere between $60 and $100.
Note: Limited bookkeeping requirements are best served under an hourly arrangement.
Monthly Retainer Fees
Basic Services: For small businesses basic services results to costs of between $200 and $500 each month.
Comprehensive Services: More developed businesses incur expenses of a range from $500 to $2,500 per month.
Monthly payments assist in controlling expenses, as they provide a retainer. Monthly payments are beneficial for firms needing uninterrupted assistance.
Salaries for In-House Bookkeepers
Junior: $40,000 – $50,000.
Intermediate: With 3 to 5 years of experience earned can go up to $50,000 – $70,000.
Advanced: Seasoned bookkeepers with specializations and skills can earn between $70,000 and $100,000+.
In-house bookkeepers guarantee quality service but it does come with the added expense of having to provide any necessary onboarding as well as extra benefits.
Outsourced vs. In-House Bookkeeping: Which Is Best?
Choosing between in-house and outsourced bookkeeping depends on your business needs and budget. Here’s a quick comparison:
| Feature | In-House Bookkeeper | Outsourced Bookkeeper |
| Cost | Higher (salary + benefits) | Lower (flexible pricing) |
| Expertise | Limited to employee’s skills | Access to experienced professionals |
| Flexibility | Fixed working hours | Scalable as per business needs |
| Technology | Requires software investment | Often includes software and automation |
| Compliance & Regulations | May need additional training | Experienced in tax and compliance laws |
Many businesses start with outsourced bookkeeping and transition to in-house bookkeeping as they grow.
5 Major Signs You’re Ready to Hire a Bookkeeper
You’re Spending Too Much Time on Finances
Running a business involves many responsibilities, and if bookkeeping is consuming too much of your time, it’s a strong sign that you need help.
Instead of focusing on growth, client relationships, or improving your services, you may find yourself buried in spreadsheets and financial statements.
Hiring a bookkeeper allows you to free up valuable time and concentrate on what truly matters, scaling your business.
Your Books Are Disorganized or Outdated
Messy, outdated, or inaccurate books can create significant problems, including missed payments, tax penalties, and an unclear financial picture.
If you’re struggling to keep track of invoices, receipts, and expenses, a bookkeeper can step in to organize everything.
They ensure your records are updated regularly, so you always have an accurate view of your business’s financial health.
You Struggle with Tax Compliance
Tax season can be stressful, especially if your records are incomplete or inaccurate. Bookkeepers help maintain accurate financial records throughout the year, making tax filing much smoother.
They can also ensure you’re tracking all eligible deductions and staying compliant with tax regulations, minimizing the risk of penalties and audits.
You Struggle with Tax Compliance
Without the right structures in place, tax time can be horrific. However, if a bookkeeper helps you maintain an accurate financial record throughout the year, filing taxes is a walk in the park.
With a bookkeeper, you have someone on your team to make sure you get all your eligible tax deductions while being compliant with regulations, which minimizes risks for audits.
Your Cash Flow Is Unclear
Lacking a robust understanding of your business’s finances puts the entire company at risk, which is one of the reasons bookkeepers exist. Your business can collapse with poor management of your cash flow.
Bookkeepers provide reports that make understanding your cash flow and expenses simpler while making sure that payments are made on time.
You’re Growing Rapidly
Managing your finances becomes challenging as your business grows. You will have to manage a large number of payrolls, invoices, revenue systems, and expenses.
Now you can use a bookkeeper who will take care of all the monotonous tasks, allowing you to shift your focus to expanding your business.
How to Choose the Right Bookkeeper
To make certain that you onboard the best bookkeeper for your business, consider the following:
Capture your requirements: Identify the specifics of the bookkeeping service needed.
Verify Certifications and Skills: Ensure they possess the necessary certification and have relevant work experience.
Compare Pricing Structures: Decide if your budget permits an hourly, monthly, or full-time hire.
Collect Testimonials and Referrals: Seek customer reviews before making a decision.
Bookkeeping Tools: Most bookkeepers will have access to accounting software like EasyBooks, Quickbooks, Xero, and even Freshbooks to simplify their work.
Flexibility: Check if the bookkeeper or the bookkeeping service provider can grow with your business.
Additional Considerations
Software, Hardware, and Technology: The purchase of bookkeeping software (EasyBooks, Quickbooks, Xero, etc) may enhance productivity but does incur extra expenses.
Tax Filing: Some bookkeepers might offer these services for an added fee, which is more affordable than hiring a tax practitioner.
Consulting Services: Detailed advice on the development of financial strategies or plans for businesses can also be given, albeit at a higher rate.
Why EasyFiling Is the Best Bookkeeping Service for You
Whether you’re a multinational corporation, a growing startup, or a small family business, EasyFiling makes sure that its bookkeeping service meets your needs in a budget-friendly way. Here’s why EasyFiling stands out:
Affordable Pricing: EasyFiling offers easy and affordable packages that cater to the needs of small businesses and developing enterprises.
Experienced Professionals: A team of certified bookkeepers and accountants at EasyFiling guarantees compliance and accuracy with financial standards.
Comprehensive Services: EasyFiling offers everything from data entry, payroll processing, financial reporting, tax filing, and more.
Technology-Driven Approach: EasyFiling’s automated system is integrated with the world’s best bookkeeping software to maximize efficiency.
Personalized Support: Solutions provided by our dedicated team offer a personal touch by considering what your business specifically needs. EasyFiling does care about your business!
Scalable and Flexible: Our services are suitable/easy to adapt for established businesses as well as startups because we understand how powerful growth can be.
Conclusion
The price of hiring a bookkeeper in the US is affected by varying factors, such as the services offered, experience, geographical location, and the complexity of the business.
Outsourced services are attractive for small straightforward businesses to save on finances, while larger organizations might find in-house employees to be more helpful when dealing with more intricate finances.
Accuracy in managing your finances, and compliance is vital, which makes understanding your bookkeeping solution options and budget essential.
Frequently Asked Questions (FAQs)
How much is the average bookkeeper cost per month?
Costs range anywhere from $200 to $5,000 per month, depending on how complex the services are.
Is hiring an in-house bookkeeper better than outsourcing?
This is based on the scale and requirements of your business. Smaller businesses enjoy outsourcing because it is cost effective but larger companies might benefit from having an in-house bookkeeper.
What does a bookkeeper do?
Bookkeepers organize and supervise the maintenance of financial records, reconcile accounts, payroll, reporting, and other tax-related activities.
If I have accounting software do I still need a bookkeeper?
Yes, a bookkeeper’s purpose goes beyond what the software offers.
Why should I choose EasyFiling for bookkeeping?
The reason is that EasyFiling provides all-in-one bookkeeping services that are cost-effective, easily customizable, and use advanced technologies with human personal support.
Nabin Adhikari
