What is there in bookkeeping, I can do my own.” Probably a common fallacy made by business owners!
Many think, why pay for a pro, bookkeeping looks simple enough. I mean with all these new applications, just connect your bank & credit accounts, categorize transactions and you are home.
Well, let me tell you that this notion is not factual at all! Think for a moment that you can buy over-the-counter medicine for a common cold, but not for an infection! You must go to a doctor, in this case, an accounting/bookkeeping pro!
Categorization is just one part of the entire bookkeeping process! There is the reconciliation process, taking out HST/GST, periodic adjustments, generating financial statements and then interacting with your year-end accountant, to name a few.
The actual cost of doing your own books includes your time, stress, and not forgetting, the money value of your mistakes.
While it’s great to do things on your own, sometimes you are better off just hiring the right pro – and a right pro would pay itself off many times!
Let’s list the hard costs and the soft factors:
Software – $50/mo
Time – $50/hr * 10/hrs/mo = $500, not adding any training time spent on learning the trade of bookkeeping and its finer things!
Stress – We can’t put a monetary value on it! Everyone has their own resilience and tolerance levels.
Opportunity cost – Maybe you lost a great business opportunity by diverting your focus to bookkeeping rather than your business!
The hard costs of doing the DIY bookkeeping come to $550, the soft costs are untenable!
And, because of all the stress, lost business opportunities, you’re likely to make mistakes that could negate all your hard work.
It all adds up to cost a hell of a lot more than $550/mo.
When you are just getting started with your business, things like setting up the accounting process, system and software, etc. can be intimidating. But you can easily navigate this by teaming up with the right professional and letting them take over this process, while you focus on your passion and business.