Don’t Use Quickbooks For Self-Employed Accounting (Especially If You’re Creative)

You’ll probably hate using Quickbooks, and it’s hard to force yourself to use something you hate. To stay on top of your finances, choose an accounting system that’s right for you. Here’s how.

You can watch my interview with Dani Gardener, or read the article below!

If you’re self-employed you need to stay on top of your finances. That means keeping track of your income and expenses throughout the year. If you’re new to being in business for yourself, you may not know how to do that.

What most people do, is turn to Google. There, you’ll find a variety of recommended accounting software options, like Quickbooks, Freshbooks or Wave. If you know nothing about these programs, you’ll pick one, cross your fingers, and hope it’s what you need. 

Before you do that, I want to give you a heads up. Quickbooks and similar programs aren’t great for a lot of people, regardless of what the marketing says. Don’t get me wrong, I love Quickbooks. (I’ve been using QB since 1997!) But I’m a finance professional with decades of experience. I’m guessing you aren’t. The truth is most finance programs are made for bookkeepers and accountants, not the average self-employed person. Especially not people who consider themselves creative.

Quickbooks may work for you if you’re more of a “left brained” person, meaning you like linear thinking, mathematics and logic. Or if you love learning new software.

If your mind feels more “right brained” though, you may struggle. I notice that artistic, creative and imaginative people find Quickbooks-type programs overwhelming. Frankly, they hate using it. 

It’s hard to force yourself to use something you hate. Likely, you’ll put off managing your finances for weeks or months at a time. Soon, tax time will catch up with you. You’ll stress and scramble trying to get all your information together.

It won’t be because you’re not capable of managing your finances. It'll be because you innocently fell for one of the most common financial mistakes I see. Freelancers, solopreneurs and contractors often choose an accounting system that isn’t right for them.

So…

How do you choose the right system?

If you’re handling your own finances, it’s important to work with your money in a way that fits your style and abilities. You need to consider that when choosing an accounting system as well.

You, my creative friend, are a feeler. 

It’s a strength, so use it. How you feel about a system can tell you a lot. When choosing your system or program, there are a few questions you can ask yourself.

Does this feel intimidating, overwhelming or confusing?

If no, great. If yes, ask the next question.

Do I believe I can learn to use this without much stress?

If yes, great. If no, look for another option.

Am I choosing this because it feels right, or because I think it’s what I’m supposed to use?

If it doesn’t feel right, keep looking. This system is a building block for a solid financial foundation. Don't settle.

Does it look like it will meet my basic needs? 

Your needs may change. That’s ok. You can change systems as you evolve. For now, only consider the basics. The simpler your system the better.

Pay attention to your answers and let them guide you. Your gut can help you decide if you should invest your money and/or time into the option you’re considering. If you want suggestions, there are two options I recommend to creative self-employed people.

For more help in choosing the right system for you see my Simplify Your Finances tiny course.

My favorite recommendation

The first option I tell people about isn’t actually an accounting system. It’s a bank account that includes an accounting system. 

Found* is the beautiful result of an app company that partnered with a bank. And lucky you, all its features cater to the self-employed. In all the basic ways, this is a fully functional bank account. You have a routing and account number, as well as a debit card. More than that, when you log into Found, you’ll be logging into a hybrid bookkeeping system. It does a lot of your accounting work for you.

As money comes into your bank account, the app will categorize it as income. As you spend money, Found will help you categorize it into expense categories. No need for any other program or software. You bank, you categorize. That’s it. If you’re comfortable with online banking this should be a simple bookkeeping solution for you.

Found has other useful features like invoicing clients, and reporting features. It also helps you save for taxes, another reason I like it. Check out Found.com* for yourself.

*Yes, that’s an affiliate link. We’ll both earn money if you use it. But I’d recommend Found anyway. In fact, in my 25 year financial career, it’s the only accounting product I’ve recommended to self-employed people.

My Second Favorite Recommendation

If you already like your bank, and don’t want to switch to a new account, I understand. An incredibly simple spreadsheet is all most people will need. Especially if they are just starting out, or running a simple business.

You can create your own system in Excel, Google Sheets or your favorite spreadsheet program. On a regular basis, enter your income and expense transactions. Categorize them to help you at tax time. (Ie “office supplies”, “business meals”, etc). The spreadsheet can also do all the math for you by totaling your income and expenses. Then you can see your profit at any time.

If you want a done-for-you option, that’s also pretty, I’ve got you covered. The Simple Accounting Spreadsheet is my Google Sheet option.

No matter what you choose, remember, you want it to feel right. If you enjoy managing your money you’ll create a healthy relationship with your finances. Pick the program that will help you succeed.