There are more than a few reasons why I didn’t end up with a career in sales. When I sold computers, I had no problem telling a customer that another store had what they needed. I was also prone to underselling someone if I felt it better suited their needs and budget. Most of those customers were happy with the honesty…my employers were not.

The big problem with running my own business is that I have to be in sales again. If I don’t “sell” enough of you on the benefits of my bookkeeping services, it tends to have a negative impact on my bank account.

In the true Eric tradition, I thought I’d undersell you today. I have a feeling that there is a misconception surrounding bookkeepers. If I’m wrong, let me know.

The Theory

Many of you see bookkeepers as an expensive addition to your small business. Sure, the big companies have accounting departments, but individuals starting a home business certainly can’t afford a bookkeeper. Some of you believe it’s an all or nothing scenario. Either you’ve got someone working 20-40 hours per week in the office or you’re doing it all yourself.

The hourly rates of bookkeepers (and other professionals) also scares you off. In Canada, according to Intuit, the average hourly rate of a bookkeeper is $35. My rate is currently below that average at $30/hour. So, since you have that 20-40 hour work week in your mind, you now assume that it’s going to cost you between $700-1,400/month to hire a bookkeeper.

The Reality

Most of the time, if you’re running a business by yourself, you don’t need anywhere near 20 hours worth of bookkeeping per week. In fact, some of you don’t even need a bookkeeper on a monthly basis. Many times, as long as you stay organized, all you need is a bookkeeper to look over the books once or twice a year, just before you send them off to the accountant at tax time. Even if you need someone on a regular basis, it might only take an hour each week to stay up to date. That’s $30/week to take the guesswork out of your new business. Not as bad as you thought, right?

Obviously, each business is different. If you want someone else handling all of our invoicing, budgeting, bank deposits, and government remittances, then you’ll need those 20-40 hours. Like with anything else, the best first step is to plan out your needs.

The Solution

Sit down and figure out what you need to track. If it’s just you, then payroll won’t be a major job. If you don’t need to track inventory, you could do your own invoicing with something like Freshbooks. And, as long as you keep your business transactions in their own bank accounts, keeping track of cash flow should be a snap.

Next, sit down (virtually or literally) with a bookkeeper and discuss your options. You’re not on the clock, so just take your time and ask all the questions you want. In the end, I think you’ll be surprised by how little it will actually cost.

If you have questions of your own, don’t hesitate to contact me. I’m never more than an email/comment/tweet/DM/call away.

One of the many reasons I wanted to start thatbookkeeper.com was because I just couldn’t find many blogs written from a bookkeeper’s perspective. There are so many good sites written by a marketing, sales, or management expert, but I just couldn’t find anything from a fellow bean counter.

You know how, when you buy a new car, it suddenly seems like everyone else is driving that same car now? They weren’t there yesterday, but now you’re seeing them everywhere. The same thing happened with the site. As soon as I started writing, I finally started to discover other bookkeepers’ sites. Really good sites too. Since, by reading this post, you have elected to read what a bookkeeper has to say, I thought I would share my two current favourites.

One Hour Bookkeeper

I really like the tone of this site. On one hand, it’s really informative. On most sites, I’ll really get into every 3 or 4 posts, but I seem to get something useful out of every post I read on this site. On the other hand, it’s really entertaining. I love the “Bad Bookkeeper” section, that follows a fictional character who is doing all the things a bookkeeper shouldn’t do. It’s a great way to learn about how to avoid getting bled dry by an unethical bookkeeper. I think bookkeepers and business owners will really enjoy the site.

Bookkeeping-Essentials

This site is a great resource for anyone who needs to know more about bookkeeping. I don’t care how long you’ve been doing this for, I guarantee you will learn something new by reading the posts and guides. If you’re a business owner, this will help you make sense of what your bookkeeper is doing (or not doing). It can also help you learn how to do some of it yourself. If you’re a bookkeeper, this is the perfect place to strengthen your skills.

I hope you find these sites as informative and entertaining as I have. If you have other sites like these, please share them with me in the comments. I’m always searching for information, and would love to know about a new source.

There’s something that has been gnawing away at my brain for a very long time. It’s the idea of loyalty or reward cards, and more specifically flight rewards. To get downright specific, credit cards that also include some type of “Miles” program.

I understand the allure. You can’t argue with the idea of getting discounts just for showing a piece of plastic to the cashier. Suddenly, by using your card for business purchases, you’re taking the family on a free flight to Disneyland.

And, in a perfect system, these would be a great idea. When I find a small business running perfectly, I’ll be sure to let you know.

In reality, I’m not sure that these are as valuable as people seem to think. I originally wanted to calculate a real number to show how much more they would cost you than using a lower rate credit card and just paying for the flights with cash. Then I realized that there are just too many variables to give a number that I would feel was accurate.

Instead of an exact figure, let’s look at 2 numbers.

19.9 and 11.9

Hopefully you didn’t guess that those were in any way related to my IQ. No, those are interest rates. From the Canadian banks that I looked at, those 2 numbers seem to be the standard ones offered. The first, 19.9, is the interest rate you are charged on a typical Air Miles or Aeroplan Visa or MasterCard. The second, 11.9, is the interest rate you are charged on the no-frills credit card offered by those same banks.

To be fair, the 11.9 card is boring. It doesn’t give you Air Miles, cash back, Petro Points, or discounts on NHL memorabilia. It just gives you an interest rate 8 points lower than the fancier model.

Here’s where we come back to the “perfect system”. In this perfect system, interest rates don’t matter. You have painstakingly setup an automated banking system that is the financial equivalent to perpetual motion. During the month, all of your supplies, utilities, meals, and other bills are paid for by your Visa. Then, the day after your credit card statement is issued, your bank account automatically sends a payment for the full balance and the cycle begins anew.

In this perfect system, I completely agree that having this card is beneficial. You’re paying $0 in interest every month, AND you’re getting your flights either free or at a substantial discount.

It’s when you stray from perfection that this system breaks down. If you are running EVERYTHING through your Visa or MasterCard, that could mean a Visa balance in the thousands or tens of thousands of dollars each month. Make a payment or two after the cut-off each year, at 19.9%, and that flight you’re getting for free suddenly got real expensive.

What the moral of this story?

Be honest with yourself…about yourself. Ask yourself the following questions.

• How much money will I be charging to the card each month?
• How much money do I need to spend in order to generate enough points for a free flight?
• Will I ALWAYS pay the credit card statement on time?
• How much extra will it cost me at 19.9% if I don’t?
• Are there other ways for me to save money on flights?

As for that last question, sure there are. Instead of paying 19.9% interest, why not put money aside that’s generating interest of its own. Ok, probably not at 19.9%, but everything helps. If you’re always paying interest on the balance, using the boring card just saved you 8%, which is a good start. Keep your eye out for discounted flights by tracking specials on Twitter. Reduce expenses in other parts of your business. And, if it’s a flight for a business meeting, maybe find a way to meet virtually instead.

So, what about you? Do you use these cards in your business? Have they saved you money? Do you have any tips of your own? Let me know in the comments.