How to Organize Finances with FreshBooks

When I was approached to do a review of FreshBooks, it couldn’t have come at a better time. I have to admit, I’ve never been good with organizing my finances beyond Excel. I tried another name brand accounting product on two different occasions, and both times gave it up because I could never reconcile my accounts correctly. Not to mention that there was no suitable import option for PayPal with it either.

Since I love to do everything else on the web, FreshBooks seemed like the best choice for diving into proper accounting. I decided to give it a try to see if it would solve a few of my basic needs for the following.

  • Organize my clients’ information. While I love Gmail, it’s not a CRM tool.
  • Create and send invoices to clients outside of PayPal. I.e., shorten the process of having to create an invoice, save it, preview it, and then print it as a PDF.
  • Search for invoices quickly. If you’ve ever had to search for an invoice in PayPal, you’ll understand what I mean.
  • Quickly see how much income I am generating per month from specific sources. This was something I used to have to put together in a spreadsheet since I have income from freelance writing, affiliate products, advertisers, and my eBook (and soon to be premium course).
  • Make tax time a little easier next year. The spreadsheet for that to separate income from expenses and categorize it all has been a nightmare to say the least.
  • Be able to manage accounting information via mobile. Creating, managing, or simply reviewing invoices in PayPal is almost impossible on mobile.
  • Track the time I spend on projects for myself and for clients. While I do bill based on value, I still need to know if I’m spending an extra amount of time on one client over others.

According to the features, FreshBooks looked like it would solve all of those problems. Since I have more than three clients (which you can manage on FreshBooks with a free account), I decided to go with the Seedling plan after my free trial expired, which is $19.95 per month. Here’s how FreshBooks helped me with the challenges I outlined above.

Organizing Clients

The first thing I had to do was add in my clients. Since I love spreadsheets, I decided to go with the spreadsheet import. FreshBooks makes it easy by giving you a sample template to follow.

freshbooks-review-importing-clients

While you can enter each client manually using the new client form, I found it easier to type their information into the spreadsheet and just import it.

Since I didn’t want to add all of the affiliate programs, individual advertisers, eBook customers, and soon to be premium course customers in separately, I created one “client” for each so I could organize the income from them with FreshBooks as well.

Managing Invoices

Invoicing is definitely much easier in FreshBooks. Since I had already sent out a lot of invoices this year that I wanted to track in FreshBooks, I decided to recreate them, mark them as sent, and then enter payment for them. This way, I could run my reports for everything this year.

Adding invoices was not only easy, but I have the added bonus of being able to see the line items in them without clicking through. So instead of having to search for the email I sent to the client about the pricing terms and content length we agreed upon, I can just look at the invoice, hover over the description column, and get that information quickly.

freshbooks-review-invoicing

As far as the earlier mentioned side income items, I created one invoice for all of the income that I received for the whole month from those sources (affiliate products, advertisers, eBooks, etc.).

Reporting

Here’s what I’ve always lacked. Now, I can see reports for my monthly income, how much revenue I have per client by month for one year at a glance, expenses vs. income, and other standard accounting information. All without having to put together a spreadsheet with complex formulas!

freshbooks-review-revenue-by-client

(This would look more impressive if I didn’t have to blur out all of the data and if I had all of my historical data entered. But I didn’t do the later so I wouldn’t have to spend all night blurring names & numbers out.) :)

Importing Expenses

To make tax time simpler, I tried importing my PayPal account, out of which I make most of my business expenses. After my experience with another name brand accounting product, I didn’t hold my breath on this one working so well. As it turns out, FreshBooks does a great job importing your most recent expenses from PayPal and automatically categorizing them. However, they can only automatically import the latest expenses.

Since I have to import six months worth of expenses, separate out personal expenses, and categorize a specific way (personal preference), I decided to download my history from PayPal using a CSV and categorize my expenses myself, then import the CSV into FreshBooks. Time consuming, yes. But still it was still a better import process and you don’t have to “reconcile” like you do with other accounting programs.

Also, once my expenses were imported, I was able to quickly run expense reports to see a summary of how I’m spending money in my business. That, my friends, is always an eye-opener.

freshbooks-review-expense-report

Note that for automatic expense importing from your bank accounts, you will need to have the Seedling plan ($19.95 per month) or higher.

Accounting on the Go

The FreshBooks mobile app give me exactly what I need to know when I’m away from my desktop. I can create invoices, run reports find client contact information, and see my outstanding balances.

freshbooks-review-mobile-app

Time Tracking

Time tracking in FreshBooks is pretty simple to setup. First, you will need to add projects to your account. Each project is linked to a client, so in my case, I have projects like freelance writing, local marketing, and promotions. Once I set those up, I was able to start tracking time on my desktop and my mobile app.

frreshbooks-review-time-tracking

Now, I can get a better feel for where I’m spending my time all day for both my clients and my own revenue-generating projects.

Summary

All in all, I was happily surprised by the ease of setup and features that FreshBooks has to offer for the lowest price plan. It’s also good to know that if I need to add more than 25 clients or start managing a team, that the pricing only goes up to $29.95 and $39.95 per month.

Overall, I definitely recommend FreshBooks if you are a freelancer or even a blogger that is working on projects to make money online. Especially since you can start out with most of the above features (except automatic expense importing) for free with up to three clients!

If you’re curious, sign up for the 30 day free trial – no credit card required – to see if FreshBooks is the right fit for your business!

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  1. says

    I run a small company and was using Pastel for the last few years. A business associate recommended FreshBooks as a more convenient alternative. I must say I am pleased I made the switch and it took little time to get used to the programs interface.

  2. says

    Although I haven’t used Freshbooks, I have heard about it through a couple of my friends who are into finance administrative fields. As far as management and ease of use is concerned, they have rated it highly although one of them wasn’t too satisfied about the ‘online billing’. All in all a handy application. Also I look forward to put it into use some time in the near future.
    Nikhil Naik just posted How To Show Most Commented Posts With Thumbnail Without Plugin in WP