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If you run your own business, you know that there are significant differences between managing your personal and your business finances. Ideally, you would have a trained accountant overseeing your day-to-day business expenses and income. But not every business has the size or budget to justify hiring a professional.

Over the last decade, numerous financial tools have entered the market in order to help small business owners keep track of their money — expenses and income — better, and you don’t need an accounting or finance degree to use them.

Functions of an Accounting Department

Many people confuse accounting with other related areas, such as finance or bookkeeping. Finance involves overseeing and planning money-related activities, and bookkeeping relates to recording financial transactions. Accounting covers:

  • Payroll
  • Accounts Payable
  • Accounts Receivable
  • Financial Reporting
  • Financial Controls

4 Easy-to-Use Small Business Accounting Tools

1. QuickBooks

The predecessor to QuickBooks is Quicken—a program designed for individuals to manage their own finances. People became so comfortable with Quicken that they started bringing it to work.

The company developed a businesses-specific version under the name QuickBooks and has since released general versions as well as industry-specific versions. There are two versions of the software — a local version installed on your computer or the online cloud-based version.

The cloud-based version starts at $10 per month for freelancers and goes up to $60 for companies. The base versions cover things like tracking income and expenses, invoicing, accepting payments and generating reports. The more extensive versions let you manage bills and contractors as well a track inventory. As an optional add-on to almost any package, you can tackle payroll with it, too. One of the reasons people love QuickBooks is that it can get linked to your bank account for easier tracking and pairs with TurboTax for simpler filing. To learn more or grab a free trial, head over to www.QuickBooks.Intuit.com.

2. FreshBooks

For those who require slightly less robust tools and appreciate cloud-based software, FreshBooks may be a viable option. Like QuickBooks, it does invoicing, payments, reports, and expense tracking, plus offers payroll as an add-on. Cost for the top-tier options are a bit less expensive as well, topping out at $50 per month. However, QuickBooks differentiates its plans based on the features offered.

FreshBooks does this, too, but also limits the number of clients you can track. For example, the lowest tier for $15 per month limits you to five clients; the top option allows up to 500. FreshBooks offers free trials as well, so if you’re trying to decide whether it’s worthwhile to spring for QuickBooks or if FreshBooks can meet your needs, you may want to take them both for a 30-day test drive. Visit FreshBooks.com to learn more about how the software works or to sign up for the trial offer.

3. Xero

Like FreshBooks, Xero is hot on the heels of QuickBooks, but it has a bit more going for it than FreshBooks. For example, Mac users report that it offers the same intuitive experience and features as the Windows version. It’s also cloud-based and offers many of the same tools, such as invoicing, accepting payments, tracking, bank reconciliations, bill paying and payroll.

Features increase with the monthly rate, both in terms of the types of features and how much you can use the software. The lowest package starts at $9 per month, but you’re limited to five invoices, and it doesn’t include payroll. The highest package starts at $70 per month (dropping to $60 November 2018) and offers payroll for as many as 10 people. If you have more employees, the rates go up accordingly. One interesting thing about Xero is that it has its own advisor network, so if you need to connect with an accounting or finance guru to help you, there is help a few clicks away. In addition to the advisor network, Xero doesn’t hold your data hostage. They’ll also let you import your data into QuickBooks if you ever decide to switch or you later hire an accountant who prefers it. To learn more, go to Xero.com.

4. Zoho Books

Zoho Books has a few things going for it that the others don’t. First, Zoho offers a ton of other business tools, not just accounting. If you’re already using a Zoho cloud program or plan to, adding your accounting with them is a no-brainer. Right now, their offerings include full suite of CRM, HR, help desk and collaboration tools. When it comes to the accounting side, Zoho Books offers a lot of what the others do, but it nudges QuickBooks out by doing estimates and approvals, offering a client portal, and throwing in a few other features. The downside, however, is that Zoho Books does not provide payroll yet and their free trial only lasts 14 days rather than 30. Pricing is a little cheaper, though, ranging from $9 to $29 per month. Head to www.Zoho.com to learn more.

Interstate Capital Can Help Too

If invoicing and tracking cash inflows are some of your biggest woes, Interstate Capital can help. We provide invoice factoring, which means we pay you for your invoices and then handle the collections ourselves. That means you’ll get your money faster and can reduce some of the most common accounting headaches, like getting customers to pay. You also get a personal account manager as a single point of contact and can access your data 24/7 through our robust online program. To find out if factoring is right for you, download our free factoring guide or get a no-obligation factoring quote today.