how to start a virtual bookkeeping business
Starting a virtual bookkeeping business is not as difficult as it seems. Use this step-by-step guide as a starting point to learn how to set up your virtual bookkeeping services business.
There are limits to who can make a great virtual bookkeeper. You don’t need a college degree, or money, or business experience to get started. You need a bus drive to earn extra income from home.
Maybe you’re looking for home business ideas — and that’s why you’re here. Or maybe you want to know that the work you do matters.
Do you know what’s so great about starting a virtual bookkeeping business?
You have to make your own schedule.
You can work with any type of business.
And of course, you can earn a living by working from home.
So, you want to learn how to start a virtual bookkeeping business?
In this guide, we’ll cover everything you need to know about starting an online bookkeeping services company and more.
Let’s begin.
Table of Contents
What is virtual bookkeeping?
Virtual bookkeeping is a way to record, store and manage all financial transactions for a business from a remote location.
The goal is simple: track the company’s revenues and expenses to optimize profitability.
A virtual bookkeeper helps companies stay on track financially, understand their big financial picture and decide where to spend money.
When people talk about virtual bookkeeping, they are usually referring to online bookkeeping services. Or an outsourced contractor who helps monitor individual accounts, collect taxes, and prepare financial statements.
Virtual bookkeeping services help business owners focus on running their business.
Some small businesses choose to do their own bookkeeping to save on costs, while others prefer to hire bookkeeping professionals.
A virtual bookkeeper allows firms large and small to achieve expert recordkeeping with greater flexibility and lower costs.
Plus, you get to balance their books from home in your underwear – there’s nothing better. This is a win-win situation.
How virtual bookkeeping works
In short, when a company hires a virtual bookkeeper, it gives the bookkeeper (you!) remote access to its bookkeeping software and financial documents.
You can log in from home and access records and documents as if you were sitting with them in their office.
There are three main ways to work remotely with clients using cloud technology:
- Connect remotely to your client’s computer to balance the books, just as if you worked on-site.
- Work online through cloud-based bookkeeping software (such as QuickBooks Online or Xero) with your secure login.
- Use the same desktop software you’re used to, but accessed through a hosted virtual desktop.
Sounds simple – right? And it is, but you may still be asking yourself, “Well, what’s it like to run a virtual bookkeeping business?”
Your answer is:
Some clients will want you to handle all or most of the bookkeeping. such as preparing invoices, billing customers, or payroll. You may even need to email copies of the invoice to the client for approval and have a signature stamp for payment of the invoice.
Some clients will perform tasks on their site, such as entering bills, writing checks, sending invoices, and more. In this case, you will be responsible for making sure they make the proper entries, reconcile accounts and bank statements, obtain financial documents, and more.
Virtual bookkeepers also make themselves available to discuss budget planning, late customer payments, cash flow, and any other finance-related questions.
A virtual bookkeeper’s job will involve some data entry and receipt tracking. You are responsible for categorizing expenses, telling who was paid and how much, and keeping track of receipts. For Revenue, you are responsible for tracking payments and dealing with any invoicing issues.But your job is about more than numbers in a spreadsheet. Bookkeepers are also responsible for preparing four important financial statements:
- Balance sheets, or summaries of the client’s financial position.
- An income statement, or a look at a client’s income and expenses over a period of time.
- A statement of changes in equity, or statement of retained earnings, that shows changes in owners’ equity, retained earnings, and reserves over a period of time.
- A cash flow statement, or a record of cash and cash equivalents entering and leaving a company.
What do you need to become a virtual bookkeeper?
To become a virtual bookkeeper, you must have the same essential qualifications as an on-site bookkeeper. Also, reliable internet and a laptop. Bookkeepers are good at accounting, have basic math and computer skills.
Even if you don’t have formal training, don’t sweat it. You can choose from a bunch of certification courses or classes to learn new skills and take your business to the next level.
Benefits of virtual bookkeeping
Now, there are many wonderful things about owning your own virtual bookkeeping business and working from home. The benefits are real, you can:
- Set your own schedule, which means it can be as flexible as you want.
- Start your day whenever you want.
- Wear sweatpants most days.
- Challenge yourself to earn more because no one sets your salary.
- Cook lunch at home
- Stop with your pets, and take breaks whenever you want.
I mean, which one sounds better? But let’s talk more about the actual benefits of virtual bookkeeping.
How many hours a week do virtual bookkeepers work?
In a typical work week as a virtual bookkeeper, you can expect to work … as much or as little as you want.
If you want to be your own part-time employee, you can work 20 hours a week.
If you want to be a chicken with the head cut off, you can work 50 hours a week.
Remember, this is not a bookkeeping job – this is your own business. So you set the number of clients, hours, and time to work each week.
What kinds of clients do a virtual bookkeeper work with?
That’s the beauty of being a remote bookkeeper. You can also work with almost any type of small business you want.
Accounting rules vary by country, but bookkeeping is a universal language that is spoken the same no matter where a client is located.
Thanks to new cloud-based technology, you have the opportunity to reach a wider audience. Receiving documents by fax, face-to-face client meetings, paper invoices – all these are a thing of the past.
Cloud apps also help you position yourself in the competitive market. You can offload some administrative tasks, update reports, and let clients see their financial data in real time.
What are some good resources for starting a virtual bookkeeping business?
To help you stay up to date on all things virtual bookkeeping and accounting, we’ve compiled a shortlist of resources to help you keep up with what’s happening in the industry. You can find information about international and national associations, publications, blogs and more.
Blogs and newsletters.
Look, we’re not saying you have to sign up for every bookkeeping blog, but you should subscribe to a few to get in the know. Here’s a list to check:
e-News subscriptions (IRS.gov)
Look, we don’t want to toot our own horn—but if you need more help getting started with bookkeeping, you’re in the right place.
We make it easy for you to create a life of independence with free training, resources, and more on how to start and grow a profitable bookkeeping business — from anywhere in the world.
Over to you
Bookkeeping is changing rapidly with new cloud technology and the ability to work remotely with clients. Virtual bookkeepers have to adapt to give your business an edge over your competition.
Remember to focus on providing customers with convenient and valuable experiences. People buy from people, not just from a company.
If this all seems overwhelming – take a deep breath. Trying to understand what virtual bookkeeping is and how it works will help you start a great business.
Here’s your action plan
- Decide on funding.
- Create a business plan
- Obtain necessary bookkeeping certification.
- Choose a business name and structure.
- Get your hardware together.
- Create a website and branded email address
- Choose your bookkeeping software.
- Promote your bookkeeping business.
- Learn, grow and expand your offering.
But if you need more personal, specific advice on starting your own virtual bookkeeping business and making money from home, check out our other resources to get started today.
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