What I Don't Know About Bookkeeping Software
Module: Keeping Track of the Money
Here's the thing nobody tells you: you don't need software to keep good books. You need to actually keep them. Those are two different problems and I've watched people solve neither by buying an app.
I should say up front, I'm not the guy to teach you QuickBooks. I've never used it. I've never used Wave or FreshBooks or any of the other ones that show up when you search "bookkeeping for small business." I'm sure they're fine. Probably good, even. People I trust use them and don't complain. But I do everything in a plain spreadsheet, the same one I've been running since about 2016, and it works for me. So this lesson isn't going to tell you which software to pick. It's going to tell you what I've noticed from the outside, and what I think actually matters before you worry about the tool.
The tool isn't the problem
Most people who fail at bookkeeping don't fail because their spreadsheet or their app wasn't fancy enough. They fail because they didn't write anything down for six weeks and then dreaded catching up so much they just... didn't.
I know this because I almost did it myself, and I know it because I've watched it happen to a few people in this class over the years. The software question feels like the important one because it's the one you can research on your phone at 10pm without doing any actual work. Comparing three apps feels productive. It's a way of preparing to start a business instead of starting one.
So before you download anything: are you writing down what comes in and what goes out, every time, in something? A notebook counts. A spreadsheet counts. The back of a receipt taped into a folder counts, barely, but it counts. Get that habit first. The tool comes second.
What I think you actually need, starting out
If you're testing an idea on nights and weekends, here's my honest opinion: you probably don't need software. You need the separate bank account we talked about a couple lessons back, and a simple spreadsheet with dates, amounts, and what it was for. That's most of bookkeeping. People make it sound like alchemy and it's mostly just not letting things pile up.
Where software starts to earn its keep is when you've got enough transactions that a spreadsheet gets unwieldy, or you need to send invoices and want them to look professional, or you're doing your own payroll for a helper. If none of that's true yet, you're probably fine with what we built in the earlier lessons. Buy the tool for the business you have, not the one you're picturing when you can't sleep.
The clearance-rack lesson
I've told you before I have a habit of buying things because they're a deal, not because I need them. Years ago I picked up a commercial food scale off a clearance rack for twelve bucks. Felt like I'd won something. Used it maybe twice. It sat in my garage for years — I only really "found" it again the last time I reorganized out there, which is its own project I get into every so often.
Software's the same trap, just at a bigger price tag. A twenty-dollar-a-month app is a $240-a-year clearance scale if you're not using half of what it does. I'm not saying don't ever get one. I'm saying don't get one because it's on sale for three months and feels like the responsible adult thing to do. Get one when your actual bookkeeping has outgrown the thing you're using now. Not before.
If you do want to try something
If you're curious and want to poke around, that's completely reasonable. A few of the free or cheap options let you connect your business checking account directly, which does save some typing. Some people love that. I'd rather type it myself so I notice what I spent, but that's a preference, not a rule.
A couple practical notes if you go looking:
- Try the free version of whatever it is for a real month before you pay for anything. See if you actually use it.
- Anything that connects to your bank account needs a strong, unique password and two-factor turned on. That's not me being dramatic, that's just how you should treat anything linked to your money.
- Keep exporting your data now and then, even from a free app. Companies change their pricing or shut down features with about two weeks' notice, and you don't want your only copy of a year of bookkeeping sitting inside somebody else's app when that happens.
What I'd tell you to actually do this week
Open whatever you're using now — spreadsheet, notebook, whatever we built together — and check: is it current? If it's not, that's the fix, not a new piece of software. Software won't make you write things down. Only you do that.
Before next time: bring your current tracking, whatever it is, and we'll look at whether it's actually keeping up with you or whether you've been meaning to catch up for a while. No shame either way. I've been there.