How to set up a bookkeeping system for your new business in less than two hours.
1. Sign up for a Bank Account
Creating separate accounts is the easiest way to isolate business transactions. Young companies often see a lot of cash flow volatility, so look for a business checking account with no minimum balance requirement.
Top Pick*: Novo Business Checking
2. Get a Business-Only Debit or Credit Card
Your checking account will likely come with a debit card. For a credit card, be advised that until your business builds its own credit history, you’ll need to personally guarantee the debt, even if the card is in your business’s name.
3. Choose and Accounting Platform
Your accounting platform will do the majority of the grunt work to keep your books up to date. While Quickbooks is the most common, it's also one of the more expensive, and there are many others to choose from. Once you’ve created your account, sync your checking and credit card accounts to it so that all transactions will be pulled in automatically.
Top Pick: Wave
4. Create Invoice Templates
Get ready to get paid by setting up invoice templates via your accounting platform and connecting the payment processing tools to your bank account.
5. Set Monthly Task Reminders
It’s a best practice to go through and update your books at least once a month. This process is called the monthly close. First, gather your bank statements, go into your accounting platform, and make sure everything matches up (this is called reconciling). Second, go through and assign each transaction to a category (e.g. office expenses). Lastly, take a look at your Profit & Loss statement and Balance Sheet to see how your business is doing, overall.
Top Pick: Asana
Bookkeeping will become more complicated as your business grows. When you start doing things like buying inventory or taking out a loan, that’ll be a good time to think about hiring an accountant. Until then, this process will keep your books clean
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