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Did you know you could easily make $47,000 yearly on average from entry-level bookkeeping jobs? Imagine how much you can make with a few years of experience under your belt.
It is a common misconception that bookkeepers and accountants are the same and both terms are often used interchangeably. However, both professions are entirely different from each other. Bookkeepers help maintain accurate records of an organization’s financial transactions whereas accountants collect the financial information for an organization and provide insights for business decisions.
Many businesses need bookkeepers to ensure their financial records are up-to-date and accurate, which is where you come in. Incidentally, it is a very lucrative job where you have the option to work remotely as a freelance bookkeeper or in-house for an organization as a side hustle. Bookkeeping can also be an entry point into accounting as it helps you gain practical experience in the field.
So, if you love to work with numbers and can read patterns like a pro, bookkeeping might be the perfect opportunity for you to make some extra money.
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1. What a Bookkeeper Does
To become a bookkeeper, you first must know what a bookkeeper really does. Bookkeepers manage organizations’ day-to-day financial transactions. As a bookkeeper, you might even help with filing taxes and managing payroll, depending on the company’s finance department’s structure. As a bookkeeper, your duties will include:
- Entering financial transactions and maintaining records, including employee transactions.
- Monitoring and submitting payments and updating the company ledger.
- Helping with bank deposits, verifying receipts, and managing cash drawers.
- Compiling the organization’s profit and losses, payable, and receivables information as financial reports.
- Checking for any errors in previous financial reports while maintaining accurate payroll records.
- Managing payrolls, keeping tax withholding records, and issuing paychecks.
Working as a bookkeeper gives you the flexibility to have a work-from-home job or work full-time. When working freelance, you are free to work according to your own schedule, but you will also have to handle multiple clients simultaneously. In comparison, full-time bookkeepers work fixed hours but only handle a single client.
2. Skills and Qualifications Needed to Become a Bookkeeper
To have a successful bookkeeper career, you will need certain technical skills, like general computer literacy, proficiency in basic math, and an understanding of bookkeeping software. While most businesses use QuickBooks and Xero for bookkeeping, the industry is evolving quickly thanks to AI, machine learning, and automation. You can position yourself better by learning new trends and adapting to these changes quickly.
Other technical bookkeeping skills a bookkeeper needs include data entry, invoicing, budget preparation, financial reporting, knowledge of programs like Excel, and general business knowledge. As necessary as these skills are, you will find it much easier to get a job and hold it if you have workspace skills. Attention to detail, problem-solving, time management, and adaptability are workspace skills that one can only build while working. Bookkeepers must also show trustworthiness and integrity as they regularly handle sensitive financial information.
Talking about educational requirements, you don’t need a certification to become a keeper. However, completing professional bookkeeping courses certainly helps improve your credibility. Certified Bookkeeping (CB) Designation and Certified Public Bookkeeper (CPB) Certification from the American Institute of Professional Bookkeepers are some of the common bookkeeping certifications.
3. Guide to Becoming a Bookkeeper
Let’s dive in deeper and understand how to become an in-house or a virtual bookkeeper.
Step 1: Gain Basic Knowledge of Bookkeeping Principles
As I mentioned before, you don’t need a diploma or any certifications to become a bookkeeper. However, you should have basic knowledge of bookkeeping principles to be able to perform day-to-day tasks. To learn these principles, you can either intern under bookkeepers and learn on the job or take beginner-friendly courses. Both have their merit, and ideally, you should be doing both. For example, interning will help you get hands-on experience. Taking free or low-cost bookkeeping courses will also strengthen you theoretically.
Aside from that, there are plenty of free resources available online for you to get a clearer picture of what a bookkeeper does. For example, the Bookkeeping Training program from Accounting Coach and The Bookkeeping Basics for Beginners video session from LYFE Accounting on YouTube is great for beginners looking to learn the basics.
Similarly, LinkedIn Learning and Coursera have some of the best paid resources like Getting Started in Finance & Bookkeeping and Recording in Journals & Posting in Ledgers. If books are more to your taste, “Bookkeeping All-in-One For Dummies” will keep you busy. The purpose of all these resources is to learn the basics of bookkeeping before you start working with a company. As there are no specific degrees for bookkeeping, these tools will help you get up to speed.
Step 2: Choose and Learn Bookkeeping Software
To learn bookkeeping, you must first gain hands-on experience with the most used bookkeeping software. Many businesses use them for recording and managing their finances as manual recording of financial transactions can be a tedious process. QuickBooks is one of the most used bookkeeping software. It is a comprehensive software with many features like payroll management, tax preparation, and invoicing. As the cherry on top, QuickBooks offers a training and certification program for aspiring bookkeepers.
Xero is a cloud-based alternative that became popular because of its third-party app integration. It is also one of the first bookkeeping software to integrate automation features and has a training program to learn the new features.
Before buying memberships, first use trial or demo versions and leverage free tools like FreshBooks and Wave. Both of these are beginner tools and have all the features like invoicing and financial reports you will need when starting. Free tools like Freshbooks and Wave will help you learn the ins and outs of the bookkeeping software as you work your way to becoming a freelance bookkeeper.
Bonus tip: Udemy and LinkedIn Learning have affordable certifications for QuickBooks and Xero that can help your resume stand out.
Step 2A: Get Certified (Optional but Recommended)
While you don’t need a college degree to become a bookkeeper, you must have a high school diploma or General Development Test (GED). Some companies only hire certified bookkeepers and you can get these certifications from the National Association of Certified Bookkeepers (NACPB) or the American Institute of Professional Bookkeepers (AIPB).
NACPB is one of the most popular bookkeeper’s associations in the US and provides certification for Certified Public Bookkeeper (CPB). However, to become a CPB, you must complete the Accounting Fundamentals course and pass the Uniform Bookkeeping Certification exam. On the other hand, it is a little more complicated to become a Certified Bookkeeper with the AIPB. For this, you will need a year of accounting education and experience working as a bookkeeper.
You might be wondering if getting certified is worth the hassle, as it is possible to work without doing so. Well, yes it is! Most of these programs are self-paced and can be pursued as per your availability. Not only that, these certifications will help you learn bookkeeping, gain credibility, and get more clients when freelancing. If nothing else, you will get better pay! You can make up to $40 an hour, which in my opinion, is a good enough motivation.
Step 3: Gain Practical Experience
Having bookkeeping experience will help you get paying clients, especially when starting out. Luckily, there are various ways you can gain bookkeeping experience as a fresher. For example, start by working for non-profit organizations or small businesses for free. These local non-profit organizations generally have low or no budget and appreciate help from college passouts and interns. It is a win-win situation as you will get practice in managing financial records, updating accounts, and using bookkeeper software.
Working for free or at competitive prices is a great way to collect testimonials and get word-of-mouth referrals. Offering free services at lower prices to friends, family, or small businesses is also a good way to make your name in the community. While these opportunities are great for building technical skills, part-time opportunities and internships will help you develop workspace skills.
Walmart, Best Buy, or your local supermarket can also be great places for part-time jobs and internship opportunities as working in a fast-paced industry will help you get better even faster. Alternatively, Upwork, FlexJobs, and Fiverr are some of the best freelance marketplaces to get remote clients. These virtual bookkeeping jobs are a blessing for students looking for work-from-home jobs or part-time work.
Step 4: How to find bookkeeping Jobs
The next and final step is to find new gigs and build your bookkeeping business. As a bookkeeper, you have the option to either offer umbrella services for all industries or specialize in a specific area. Some industries that hire bookkeepers are finance and insurance, professional, scientific, and technical services, construction, and wholesale and retail trade. Your pay can also vary based on the industry you choose, making narrowing down to one niche even more important.
The next step is to market your services. One of the best marketing strategies is to give services at a discount or for free to small businesses in your area. On the other hand, Fiverr and Upwork are great for getting freelance clients. To get these clients you will need a website that highlights your qualifications, experience, services, and testimonials of your previous clients. Your website is basically your resume that you can use to get new clients through Facebook groups like “USA Bookkeeping Community” and LinkedIn channels like “Bookkeeping in Bunny Slippers.”
While building a bookkeeping career is a slow process, it doesn’t hurt to join professional bookkeeping organizations like NACPB and AIPB to network and get new clients. Be it as a weekend job or even a new career, bookkeeping is the perfect opportunity for you to make some money!
FAQs
How Much Do Bookkeepers Make?
Bookkeeping is a well-paying job where you can easily make $23 per hour or roughly $47,000 per year. The actual pay depends on your experience, where you live, and the requirements of the company. For example, a bookkeeper working in New York can easily make $30 per hour. Whereas, areas like Seattle pay $28 per hour on average.
Similarly, certifications help get better pay while entry-level jobs that don’t require certifications will pay comparatively less. Additionally, working freelance or as a virtual bookkeeper gives you complete freedom over the rates and services you offer.
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