Tip 10: Hire the Right Bookkeeper
Welcome to the tenth and final installment of the Top 10 Tips for Financial Success blog series, where we hit the books to better manage your books!
Whether you're a small business or a solopreneur, these 10 tips are vital to your bottom line!
Tip number 10 Hire the right bookkeeper
Congratulations! The time has come, and you realize that in order to work more efficiently, you need to hire a bookkeeper. Now the questions become: How do I go about hiring someone to handle my books? What do I look for? What questions should I ask?
Fear not, friend. I'm here for you with the key areas to focus on when hiring the bookkeeper of your dreams!
Prior Experience, References, and Insurance
As with most professions, you'll want to know your bookkeeper's professional background to see if they are a good match for your business needs. Ask for a resume or CV, which should include the types of clients they've worked with before; have they worked mostly with retail stores, or have they done a combination with businesses that operate on retainer? You want a bookkeeper whose experience matches your business type and who can understand the way you bill clients.
Of course, references are the natural complement to a resume, and you'll want to ask for them. Be sure you talk with a representative at the company they list on their resume, not their buddy or "trusted co-worker." Ideally, you'll want to speak to someone at a company that they have done books for recently (as in the past 12 months), and you'll want to ask questions like, "What was it like working with this person?" "What did your tax accountant think about how your books looked at the end of the year?" "Did they meet deadlines?" "How did they handle matters when problems arose?"
Remember, this person will have access to your bank account information, all your expenses, and your income. You'll need to ask a lot of questions to gain a comfort level and trust. There are never too many questions, and any bookkeeper worth their salt will have no problem with you vetting them via references.
The last thing that I would say on hiring is to make sure that they have liability and cyber coverage insurance. Significant, especially in this day and age, that they have those coverages, and if they don't, move on, you'll find another.
Full charge bookkeeping or not?
Generally, bookkeepers prepare your books so that your business advisor or tax advisor can review the big picture and provide advice on your business. At a bare minimum, you can expect your bookkeeper to track your income and expenses, balance your books each month, and work with your tax preparer on tax compliance. They'll also handle accounts payable, accounts receivable, and ensure that you get money owed to you.
But they can also do so much more.
Some levels of bookkeeping services include help with human resources and payroll. At some premium levels of service, bookkeepers can offer technology and process streamlining recommendations to make your business run more smoothly and -- yep! you guessed it! -- make more money.
Knowing the industry lingo will go a long way in figuring out the level of service a bookkeeper provides. Ask the bookkeeper if she is a "full charge" bookkeeper.
A full charge bookkeeper is somebody that does soup to nuts. They handle every sort of aspect of your bookkeeping. Someone who is not a full charge bookkeeper might do only data entry and reconciliations.
Be clear on what you want. If you don't want to think about your books AT ALL, keep the phrase "full charge" in mind when asking for bookkeeper referrals. Asking this detail upfront will save you sanity and money later on.
What does a bookkeeper cost?
Naturally, bookkeeping services will depend on the level of service you are seeking, and the regional market also drives them.
For instance, in the Boston area, business owners can expect to pay anywhere from $50-100 an hour for a high-quality bookkeeper. Quite a range, but it accounts for the levels of service you can expect, and clue you into aspects like experience, full charge vs. not full charge, and if the bookkeeper carries liability and cyber coverages like we talked about earlier.
The better question to ask yourself is: What does NOT having a bookkeeper cost?
Remember, every tip we've covered in this blog series relates to one long-standing theme: saving you time and money. For the same cost as your monthly Starbucks habit, you can have a professional manage your books and keep your financial house in order.
The Bottom Line
Think of your bookkeeping expenses as an investment in your business. A quality bookkeeper will help you manage costs, identify opportunities for more business, and, overall, place you in a position to watch your business grow.
At Beth Blaney & Associates, we help clients create new and better financial habits that support their business and lives. Connect with us at firstname.lastname@example.org to schedule a "Bookkeeping Clean Up and Evaluation!" today! We look at your books in their current state and offer suggestions to build a stronger financial foundation for your business.