The Freelance Bookkeeper

When I was a kid first learning how to ski downhill, I actually read a book about it. (Yes, I know. I’m a geek. But I didn’t want to break any bones, since I knew that skiing could be risky.) I checked out the skiing equipment, talked to a few friends who already knew how to ski, and tried to imagine how it worked – the mechanics of it all. But I didn’t really figure out how to ski until I got out there myself on the bunny hill and started watching the little kids zipping around like it was nothing. They made it look so easy.

It wasn’t.

But when I finally got the courage to put on the skis myself and ”Just Do It,” I learned. Sure, I fell down a lot. But I continued to watch those who were skiing much better than I was, watching their techniques, how they handled different challenges. Then I’d try doing them myself. And you know what? I became a decent skier in a relatively short period of time!

It’s really no different when it comes to starting and building your own freelance bookkeeping business. However, when I was starting out, I didn’t really have any role models to learn from. I just read a few books (the few that I could find) and jumped in. Yep, I tumbled more than a few times too. But now, 18 years later, I think I’ve got the hang of it.

But the path I took when starting my business was not typical, and I didn’t face some of the challenges that I know many of you do. So instead of just drawing on my own expeience, I wanted to provide a more well-rounded appraoch for seeing how it can be done. That’s why I’ve decided to interview several freelance bookkeepers who are at diffrent stages of success with their business in the coming months.

The idea is that we can all learn, grow and improve, no matter what level of success we’ve achieved so far. No one knows everything there is to know about everything. There are so many ways to start and run your freelance bookkeeping businesss. By seeing a variety of real life examples–sharing the ideas that paid off, and the ones that bombed–we can all reach our goals quicker and easier.

This month, accomplished freelance bookkeeper Sylvia Jaumann has stepped up to be the first case study and share her experiences of how she was able to get her home-based bookkeeping service off the ground from zero to what it is today, a thriving full-time business.

Thanks Sylvia for letting me interview you for the blog! So let’s get right to the questions, shall we?

What was it that made you decide to start your own bookkeeping service?

I’ve pretty much always wanted my own business because I have a strong independent streak. I also got tired of working for bosses who didn’t value my skills or pay me what I thought I was worth.  Once I found out that I could be making $10 – $15 more per hour working for myself, it seriously motivated me to launch my own bookkeeping business.
 
What were the very first steps you took in getting your business going; how did you get your very first client?

I struggled for the longest time with all the logistics I would need to run a freelance bookkeeping business.  Getting a business license and setting up my office was a no-brainer for me.  But when it came down to how I would keep track of all my clients, track my billing and stay organized, I was immobilized with doubt and fear.  I ended up subcontracting for another bookkeeper for a year and this helped me fill in all the blanks as I learned a ton of organizational skills from her.

I picked up my very first client through word of mouth.  I’ve acquired the majority of my clients this way.  I’ve done newspaper advertising and have received enquiries from potential clients, but I seem to find better quality clients through referrals than from other ways to promote myself.   

How much experience and/or technical training as a bookkeeper did you have before starting your business?

I’d had about five years experience working for others before I felt confident enough in my abilities to venture out on my own.  My formal education consisted of basic bookkeeping courses and an income tax preparation course.  I’ve found that’s all I’ve ever needed and it’s worked well for me.
 
What are the three biggest mistakes you see people make when they try to start their own bookkeeping business?

1. Undercharging for their bookkeeping services, thereby undercutting other local bookkeepers.  Not only is this unfair to other bookkeepers, but it’s a disservice to themselves.  Generally, it’s a lack of confidence that prompts bookkeepers to not charge enough for their services.
   
2. Being so hungry for work that they accept every bookkeeping job that comes along, even those jobs that they should probably be passing on.  Bookkeeping jobs that involve a year’s worth of paperwork stuffed in a box are not for the faint of heart.  It can be very frustrating, as often times critical information is missing.  Then there are the clients who don’t pay their bills.  Many times you only find this out after you’ve begun work on the project.
   
3. Not requesting a retainer for new clients.  This is a huge mistake made by bookkeepers who think that if they request money up front, the client will run.  Most clients will not bat an eye if you request a retainer as long at it’s reasonable.  Lawyers and accountants demand them, so why shouldn’t we?

What’s the best way to avoid those mistakes, or to fix them if someone has already made them?

1. Find out what other bookkeepers are charging and raise your rates accordingly.  You may have to gradually increase your rates with existing clients.
   
2. If you discover that you’ve received a box of unsorted paperwork, request that the client organize it for you (unless you want to do it yourself).  If you explain to the client the amount of money that they will save by sorting it out themselves, oftentimes they will do it.
   
3. Always request a retainer up front for new clients.  If a client is not paying your bill on time and you’ve already taken him on, inform him that no further work will be done until your bill has been paid.  Then get a retainer for all future work.  Once the retainer is used up, request another one.

If a close friend came to you and asked for your advice on getting started with a bookkeeping service, what would you tell her or him?

I’d tell them about the organizational systems I’ve developed in keeping my clients on track.  Setting up a system so that you always know at a glance what remittances need to be paid as well as being able to find important information at a moment’s notice. These are crucial skills for freelance bookkeepers.  Also, I’d tell them to always get a retainer up front before beginning any new bookkeeping jobs!
 
If you had it to do all over again, what would you do differently?

I would have taken the leap a lot sooner than I did. I wouldn’t have let fear and doubt hold me back from living my dream. I wasted too many years working for other people and missed out financially because of this. 

If you had to do it all over again, what would you do the same way?

I’d talk to people and not be afraid to mention that I have a bookkeeping business.  I’ve obtained so many clients by just doing that one thing alone!  Also, I’m not afraid to ask for referrals.
 
What do you think are the biggest challenges facing freelance bookkeepers today?

The biggest challenge I’ve come across are the mom and pop businesses where the mom (with no bookkeeping experience) ends up doing the bookkeeping herself in order to save money.  These small business owners think that as long as they can learn an accounting program that they can easily do the bookkeeping.  We all know this isn’t the case.  Then, at year end, the messes that have been created by the lack of experience ends up costing them more with their accountants than if they’d let a competent bookkeeper handle it in the first place.  It’s frustrating when people aren’t willing to invest in the essential expertise needed to run their business.
 
What’s the biggest challenge you’ve faced in your business so far?  How did you overcome it?

My biggest challenge was finding the self-confidence to actually make the leap into starting my own business.  I knew how to do bookkeeping but had no idea how to manage clients.  I was worried about finding the right systems to keep track of all the work and possibly missing important remittances and deadlines.  To overcome this, I ended up subcontracting for a bookkeeper for a year and learned many tricks and tips from her.  It was a good educational experience for me and gave me a huge shot of confidence.
 
How long did it take you to get enough clients so that you were working full time?

This is tricky because I’d had clients off and on for years before I finally decided to venture out on my own full time.  I’d say from the time I finally decided that I wanted to do this full time to when I actually did, was about eight months.  During this time I gradually reduced my hours at my job.

Do you have any “secret” tips, tricks or techniques that you can share with us that very few people know about that will give us an edge?

I don’t know if this is much of a “secret”, but a trick I use consistently is to setup as many recurring transactions as possible in each client’s accounting data.  I do this for bank charges, monthly debit charges that appear monthly on bank statements, vendor invoices and even for deposits.  Once I’ve figured out where something should be posted to, I don’t want to have to look up the account number every time I post.  This saves a ton of time and keeps me posting consistently to the same accounts.
 
Thanks Sylvia! You shared some really great information and insights with us!

Sylvia told me that she loves to help others get started in this business because she knows how rewarding it can be. In fact, I found out that that is the very reason she has actually written her own ebook on how to start your own bookkeeping business. It’s called, appropriately, “Secrets to Starting & Running Your Own Bookkeeping Business”

I’ve read her book and I can recommend it to anyone who is looking for a systematized way to handle the business. As you can tell from the interview, that’s a key point to what has made Sylvia’s business so successful. She’s developed and proven her techniques. I’m glad to have her ebook in my virtual library because I’m always looking to improve by watching others who are doing well (just like I did when skiing!). Would you benefit by doing that too?

Check out Sylvia’s book here———> Click Here!

So, what did you like best about the interview? What insights did you pick up from Sylvia’s experience? Did she say anything that raised questions for you? Let’s hear about it from you!

Share your comments right here on the blog!

~Gabrielle

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