In a recent post I talked about the top financial tools for your first year in business, but I wanted to come back to one of the most important tools today: invoicing software.
For most of my clients, invoicing is the source of most of their income so it’s crucial they’re using the best software solution available. There are many great solutions out there so let’s talk about a few of them.
FreshBooks is a cloud-based accounting system that is known for its ease of use. Once you sign up, you can be ready to start sending invoices and receiving payments within minutes! Creating invoices is a breeze and you can customize as needed – plus FreshBooks reminds you of unbilled time and expenses when you start creating an invoice for a client, so you don’t miss anything.
FreshBooks also sends automatic payment reminders, meaning you don’t have to worry about chasing clients who are past-due on their invoices. You can also see when invoices have been viewed. You can choose to accept a deposit, offer discounts, change currency, and add tax as needed. You can also set up recurring invoices and clients can choose automatic payment as well. Freshbooks accepts payments through their own payment processing system and through Stripe. Plus Freshbooks has an app that makes invoicing on the go super easy.
Due is a very simple cloud-based invoicing solution. Unlike some of the other apps in this list, it doesn’t pretend to be anything more than time tracking, invoicing, and payment processing. With Due, you can create simple branded invoices in multiple languages and currencies. You can customize payment terms, send automated reminders, and see when invoices have been viewed. Clients can pay with credit card or through PayPal.
Xero is so much more than invoicing, but that’s what we’ll focus on here. Like others, it is a cloud-based system. Their invoices aren’t as customizable as some, but you can add your branding and update or edit invoice terms as needed. They also offer automated payment reminders, getting you paid faster. You can set up recurring invoices or even send invoices in bulk.
Like FreshBooks, it’s incredibly easy to assign expenses and time to clients on the invoice. But what sets Xero apart is all the integrations it offers. Xero accepts payments through Stripe, PayPal, and ApplePay. And it integrates with many other software programs and systems, making it a great choice for larger businesses.
Harvest is mostly known for its time-tracking abilities, but it offers easy invoicing as well. It automatically pulls your time and expenses into an invoice for each client but it also offers custom invoices. Like other software, Harvest sends automated payment reminders and accepts payments through Stripe and PayPal. Because Harvest isn’t an accounting software, it integrates with QuickBooks and Xero so you can keep your books up to date. Because of its limitations, Harvest is really only a good option for businesses that rely solely on hourly billing.
QuickBooks Online is by far my favorite choice, mostly because QBO offers a complete accounting solution. With a variety of options that fits your business, QBO can be tailored to meet your business’s needs. Like most of the other solutions listed above, you can create beautiful custom invoices. Payment options are limited to QBO’s native payment processing, but their rates are standard for credit cards and they offer free ACH bank transfers.
I recommend QuickBooks Online because it is simply the most robust option – and honestly, the one that many bookkeepers and accountants prefer! If you’re not sure which one is right for you, ask your bookkeeper or accountant. (You’ve hired one by now, right?) Many bookkeepers include the cost of QBO or another solution in their fees, so you should always ask them what they prefer.
Deb Howard Greenleaf, EA, CEO and Principal, of Greenleaf Accounting Services provides virtual accounting and bookkeeping services and specializes in financial management to consultants, coaches, solo professionals, and other small business owners across the US. Deb is an Enrolled Agent (EA)—an IRS-licensed tax professional—and specializes in small businesses and entrepreneurs filing Schedule C or as an LLC. As an Advanced Certified QuickBooks ProAdvisor, Deb spends her day in QuickBooks Online and specializes in providing QBO support.