Accounting software is like a FitBit for your small business. It keeps track of the cash flowing through the business and keeping you alive, and you can track your financial metrics to make your business run more smoothly. There’s no point in keeping an eye on your cash, though, if you’ve spent all your cash on the software that’s supposed to watch the cash — know what I mean?
Luckily, accounting software doesn’t have to be bank-breakingly expensive. The range of options available to small businesses continues to grow, bringing new competition and lower prices to the marketplace. Here’s an overview of what you can expect to pay for your accounting package.
The ones where you pay nothing
Expectations about cost are changing, and some companies are trying to chase that shift. That’s led to a whole slew of free trials, a handful of free introductory versions, and at least one just straight-up free accounting software package. Right now, the easiest flavor of free to find is the minor-limitations flavor. These are great for small businesses as they often bring most of the features of full-priced software, with limitations that won’t affect you until you grow.
- Sage One — Limits invoices that can be sent online, linked financial accounts, and number of users.
- Wave — Wave is free accounting software, with the understanding that you’ll be advertised to while you use it.
Both of these are online services. For a list of some accounting software you can install locally for free, check out Capterra’s Free and Open Source Accounting Software blog post.
Less than $10 per month
If you want to be free of limitations or you don’t like ads as part of your accounting experience, you can find plenty of options for less than $10 per month, per user. These are all introductory products, with the exception of Sage One, which is the premium version of its free product.
- Sage One — $10 per month gives you all the bells and whistles of the free version of Sage One, but allows you to have unlimited users, invoices, and connected financial accounts.
- Kashoo — $4.99 per month lets you manage one small business. Straightforward and uncluttered, Kashoo Solo is a basic accounting package at a low cost.
- Xero — $9 per month for the Starter plan gives you unlimited users, but only five invoices and five bill payments per month. You can also collaborate with your accountant.
- FreshBooks — $9.95 per month on the Sprout plan gives you access to a five clients you can manage, automatic late fee assessment, and expense tracking.
Over $10 per month
Once you jump over $10, you open up the world of accounting software to all sorts of options. A business can easily spend $15, $20, or $70 per month to manage its books. With so many options, you’ll need to do plenty of research before you dive into this level. Here’s a quick rundown of some of the more popular options.
- Xero — For $30 or $70 per month, you can unlock unlimited invoicing and bills, payroll for up to ten employees, multiple currencies, and direct deposits. Xero claims that its $30 offering is its most popular, which allows you to manage the payroll of five employees.
- FreshBooks — $20? $30? $40? The choice is yours. At the highest level, you can manage unlimited clients and give up to five other users access to your account.
- QuickBooks Online — With versions starting at $13 and running up to $40, QuickBooks is still the most popular accounting software around. At the highest end, you’re given multiple user access, inventory tracking, purchase orders, and over 65 built-in business reports.
The big hitters
Beyond these software tools, and their many cousins, you’re starting to enter the world of enterprise-level accounting. Packages like Oracle Financials or Microsoft Dynamics are going to run you thousands of dollars and provide very little that a small business would ever find useful. That’s not to say that it’s bad software, but this shoe is unlikely to fit.
If you think you might need an enterprise-level solution to your accounting problems, please don’t tell your boss that you’ve been thinking about Wave because you heard that it was free. That doesn’t end well for you.
The bottom line
There are accounting options for every budget. For most small businesses, you’re going to be able to find a solution for you in the $5 – $20 per month range. There are also still some installed packages out there, with QuickBooks leading the pack. You can get a one-user, local install of QuickBooks for $300 MSRP.
If you want to look through the entire set of options, check out Capterra’s accounting software directory. And, as always, talk to your accountant if you want personalized advice for your company.
In your experience, how much does accounting software cost? How much should it cost? Leave your thoughts in the comments below!
Header by Abby Kahler