How to Manage Your Remote Based Business Finance and Accounting

Online accounting and finance for digital nomads / remote based businessAlthough you might be making enough money with your remote based business and if you’re a digital nomad, you might be doing more than enough to travel to places that you had never imagine you would go to, it’s critical that you keep track of everything to make sure you keep a positive ROI and achieve the business goals you’ve set as a target. Online bookkeeping and accounting software will help you do this independently of your location.

Not all services are created equal though, and there are different pros and cons worth discussing. You need to choose the right product or service to meet your needs, and in this article, we want to help you understand how to manage your remote business finances.

Why Managing Finances Online is Crucial for Remote Based Businesses

Truthfully, managing your finances as a remote based business or remote professional is as essential as it would be for anyone else. You need to have a solid income source, and you need to have a clear cut budget for how you’ll manage your money while you’re out surfing the globe in case you decide to do it so. You need to make sure your expenses don’t exceed your income, which is why is critical to correctly calculate your cost of living & budget as a digital nomad.

Even when you’re living outside of the country, if you are a US citizen for example, you are still required to pay taxes in the US, so you need to keep track of everything no matter what. Proper bookkeeping is a critical part of your business and an excellent way for you to measure and observe your growth.

If you don’t have your finances in order, you won’t know if you have enough money to continue your nomadic lifestyle. Bookkeeping and financial planning are the keys to success for everyone working remotely.

Criteria to Consider When Choosing an Online Finance / Accounting Software

Generate a report with your business expenses? Send an invoice automatically every month to your clients? Besides these common accounting software functionalities, it’s also important to take into consideration “non-functional” requirements that will help you to work far more efficiently:

  • Bank account integration & financial compliance: Avoid manual imports, excel comparisons or copy/paste scenarios by looking into a software that supports integration with your bank account and that complies with your business base country legal/financial requirements.
  • Mobile access and portability: Having the ability to connect and check your finances on the go, or easily import your expenses receipts by just taking a photo with your mobile, etc. are some of those functionalities that will highly facilitate your day to day as a digital nomad.
  • Security: You want to be able to connect and check your finance information only, but that also carry some risks. It’s then critical to choose a software that complies not only with legal, finance standards, but also offer certain security measures and validation.
  • Dashboards, projections and insights: Accounting and finance software are not only useful to help reduce errors, but it can help you gain valuable insight into the performance of your business to analyse how to improve it further. Many accounting software have highly flexible dashboards templates that show you how your business is performing and create projections based on the historical data that will allow you to identify opportunities.

Besides the software functionalities & characteristics, consider those specific aspects that should influence your decision making process based on your business size, as they will likely have an impact on the software price:

  • A solopreneur will not need the same accounting software as someone who is managing a remote team of 50 employees, right? That said, not all accounting software are cut out for managing payroll, benefits, and all the things that a “team-based” software can do.
  • Small business payroll software like Quickbooks has many different programs in one, and it has tiered options that allow you to tweak the software to meet your unique needs.
  • Business management software programs are more expensive, but they offer more features. These also include point of sale, inventory management, CRM, billing, and purchasing. This software is for larger businesses that hold inventory and purchase regularly.

1. Most Popular Online Finance/Accounting Software

Here are four of the most popular finance/accounting software available today:

1.1. Xero

This software almost seems like it offers big and small business accounting in one. With Xero, you get a real-time view of your cash flow. From the dashboard, you can look at your bank account balance over time, business performance, invoices, and total cash flow. You can do all of this from their mobile app as well.

Directly from Xero you can send and accept invoices. You can even see when the customer has opened them. Xero allows you to manage inventory, send purchase orders, manage and schedule payments, as well as 700 other tools.

Pros

Xero is a cloud-based software with over 2 million users. What’s the secret behind its popularity? Its robust accounting utility, backed by several great time features that save users’ business time. And as we all know, time is money.

Features such as group invoicing, default email templates, and automatic sales tax lookups are also a godsend for business people. Additionally, the software presents some nifty conveniences such as a sales and bills overview.

The most important thing for small businesses to consider, though, is that Xero offers unlimited users. That saves a considerable amount of money down the line.

Cons

There are drawbacks to keep in mind, though. Xero’s tax support is relatively limited, and the range of its invoice templates leave a lot to be desired. Furthermore, many users claim that Xero has a rather steep learning curve. It takes time to settle in and use the software efficiently.

On another level, Xero has recently come under fire for raising its prices. It is now a rather pricey option for some. Additionally, Xero recently restricted some of its features behind more expensive plans, making the cheaper ones seem stripped down for some.

1.2. Sage

The Sage software allows you to manage everything remotely. You can send invoices, monitor cash flow, import data, reconcile, report, and predict your business tax all from their dashboard. They offer a few different plans to meet the needs of every growing business. The main purpose of Sage is to send and receive invoices.

Pros

Sage is well known for being a comprehensive, robust, locally-installed accounting software. When it comes to business, though, you want to consider Sage Business Cloud Accounting by virtue of it having cloud features.

Sage brings to bear a beautiful UI while remaining sleek and straightforward. Additionally, the software is packed with useful features such as invoice customization, inventory, and integration with over 60 other programs.

Like Xero, Sage also offers unlimited users, making it a cost-effective option.

Cons

While generally feature dense, the software lacks a few features, which some may find to be a significant limitation. There is no project management, no time tracking, and no payroll with basic plans. Additionally, Sage has some rather basic invoice templates, leaving one somewhat underwhelmed.

Lastly, if you rely on mobile apps to get things done quickly, without having to get the laptop out, Sage might not be for you. Its mobile application is buggy, has limited functionality, and often crashes, particularly on Android.

1.3. Freshbooks

Freshbooks offers an all-in-one accounting and invoicing software you can manage from anywhere. The goal of this software is for you to spend less time on your business finances. With Freshbooks, you can automate tasks like invoicing, expense organizing, and time tracking. You can send incredible looking invoices, collaborate with other team members, and organize your expenses.

Pros

Among the biggest names in the accounting scene with over 10 million customers, Freshbooks has undoubtedly earned its popularity through its ease of use. Freshbooks features one of, if not the best, customer support on the market. It is prompt and concise, yet you are guaranteed thoroughness.

Freshbooks is convenient and efficient. Users can expect ease and thoroughness when accessing the platform for their needs, invoicing, billing, and expense tracking. For once, you don’t need to be an accountant to use software for accounting.

Cons

Freshbooks does fall short in some rather crucial areas, though. While recently updated, its feature repertoire is still, to a large extent, restricted to pricier payment plans that don’t provide the greatest value. Many view Freshbooks as expensive for what it offers, even with the more basic payment plans. This holds particularly true when you keep in mind that even some free competitors offer more features than Freshbooks.

1.4. Quickbooks

This software provides a wide variety of package options ranging from self-employed individuals to large corporations. With Quickbooks, you can manage everything from their easy to use dashboard. You can look at your current business cash flow, check out bank account balances, manage invoices, send payments, and schedule bill pay. It’s easy to keep everything organized and simple using Quickbooks.

Pros

Quickbooks Online has grown to over two million users, with the software seeing regular updates and significant changes. The software’s features check all the boxes, with a project management feature being the most recently added to its extensive arsenal.

Quickbooks boasts multiple currency support, inventory capabilities, comprehensive reporting, customizable invoices, and over 600 integrations.

With all these features, it should be no surprise that Quickbooks is considered easy to use and efficient at getting stuff done. Even accountants appreciate the capabilities of the software.

Cons

Quickbooks is not without its faults. It is expensive, and its prices have only hiked in recent times. Additionally, many consider the software’s customer service to be relatively poor, with slow service time and obscenely long phone calls to resolve a simple issue.

Furthermore, Quickbooks can be somewhat buggy and is prone to crashing at seemingly random times. In the past, downtime and outages were commonplace. However, Quickbooks does seem to be addressing this issue, and those are becoming rarer.

1.5. Wave

Wave has been making waves in the accounting industry. It has grown from 1 million users to over 3.5 million in a matter of years, and for a good reason. All other software have difficulty competing with Wave’s price tag. That’s because it’s free.

Pros

However, it isn’t like those other “free” software. There are no artificial limits on everything you try to do in an attempt to pressure you into giving in and paying. Wave is genuinely free, no limits, no strings attached. It really doesn’t get much better than that.

Additionally, Wave is user-friendly, with little to no learning curve. It’s easy to dive into and get to work. Wave also presents convenient features such as lending, automated expense tracking, lightweight eCommerce functionality, and cash-basis accounting.

Cons

It’s not all sunshine and roses, even for Wave, and there are areas where it falls short. Wave lacks on the feature front when it comes to project management, inventory, and time tracking.

Additionally, while it does have mobile apps, they are relatively poor in functionality. Wave also can’t add multiple users. Thus it’s not viable for larger businesses or even some small to medium ones.

Lastly, Wave lacks many third-party integrations, which can be a significant inconvenience when you encounter it. When considering Wave, keep in mind which third-party integrations you might be using and whether there’s a workaround.

2. Most Popular Managed Online Bookkeeping/Accounting Services

If you’re completely lost and you need someone to manage your finances for you, there are online-based services that can help you as well:

2.1. Bench

Bench offers online bookkeeping services. The difference between this and the previous programs is these services are conducted by actual bookkeepers. They’ll give you a monthly financial statement and expense sheet so you can see everything that happened with your money. They provide a year-end financial package as well with everything you need to file taxes.

Pros

Bench is a relatively speedy online bookkeeping service. They get stuff done quickly, so quickly that you don’t even have to pay attention to it. All you need to do yourself is link your financial accounts to them, and they’ll take care of the rest. The time-saving utility is excellent.

Another area Bench has you covered in is expertise. They have actual, professional bookkeepers working on your accounts, with a senior bookkeeper who reviews financial statements as well. If you’re using Bench, blunders will be the last thing you have to worry about.

Cons

Bench’s bookkeeping system is proprietary and does not integrate with other accounting software such as those discussed above. Accordingly, this means that using other software alongside Bench is not possible. Furthermore, this makes switching to a different bookkeeping service difficult.

Additionally, Bench does not include tax filing services. To do so, you have to pay an additional service charge, just for convenience. The lack of tax filing, combined with the earlier con, can lead to significant inconvenience.

2.2. InDinero

This software gives you an overview of your income, expenses, and profits. Beyond providing you with an easy to use dashboard to get an overview of your finances, they also have a dedicated team of accounting and bookkeeping experts to help you manage everything.

Pros

InDinero features a real-time dashboard, which you can access from your mobile or PC. Accordingly, users may feel much more secure viewing their finances and how they are dealt with.

Furthermore, InDinero offers comprehensive, practical reports that give you all the information you need for tax season and paint a clear picture of your finances. Essentially, InDinero is the bookkeeper to opt for if you’re concerned about transparency.

Cons

InDinero’s transparency comes at a premium. It’s a pricer option than some of its competitors.

Recently, InDinero’s price has risen, which follows a general trend with the service becoming a progressively larger strain on pockets.

Lastly, InDinero has no support for other currencies; this is likely to be problematic for digital nomads or some businesses.

2.3. Pikohana

Pikohana closely resembles the Bench service. Here we have a highly dedicated team of bookkeeping professionals that will help you manage your finances by basically taking care of it for you. Their service is compatible with Xero and Quickbooks so you can use the two side by side to manage your finances and control everything yourself.

Pros

Pikohana is compatible with accounting/financial software such as the ones discussed above. Accordingly, this allows you to pitch in and manage parts of your finances you want to handle personally.

Pikohana comes with a dashboard full of statistics and analytics to keep track of your finances and ensure transparency and complete visibility for your bookkeeping.

Cons

Pikohana isn’t as well known and hasn’t had as many clients as the other BookKeepers on this list. As a result, there is a level of uncertainty when using their services.

Pikohona’s pricing policy can also be pretty restrictive. The service charges an additional premium based on the number of bank transactions. When you reach the limit, you have to purchase more manually. As a result, depending on the business’s nature, Pikohana can be a costly option.

2.4. Botkeeper

Botkeeper offers human assisted, automated accounting: “Botkeeper combines artificial intelligence and machine learning technology, with high-quality skilled accountants to deliver a full-suite bookkeeping & pre-accounting solution”, offering unlimited support and bank-grade security.

Pros

Botkeeper offers detailed, comprehensive analytics and graphs with its reports, clarifying problems and what goes where.

Additionally, Botkeeper has a dedicated account manager for each user account, ensuring attention to detail. At the same time, there is also a team of experts reviewing everything to prevent errors.

Cons

Botkeeper requires you to integrate accounting software such as Xero, Quickbooks, and the others discussed above to have comprehensive accounting.

Botkeeper also has only essential revenue recognition capability, which can be an inconvenience as it may require micromanaging on your part depending on how you get your revenue. Additionally, Botkeeper does not have an extensive list of eCommerce platforms with which it can integrate.

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