I once had a client who was trying to manage her entire business bookkeeping… using the Notes app on her phone. Yes—really! And as you can imagine, the chaos completely overwhelmed her. She couldn’t tell where her money was coming from or where it was going. She had no clear view of who still owed her, and keeping track of what she owed her contractors? That was a mess.

If you’ve ever found yourself in a similar spot—juggling numbers in notebooks, spreadsheets, or random apps—this is for you. I’m walking you through the different bookkeeping methods available and helping you figure out which system might be the right fit for you and your business.

I share that story for two reasons:

First, to remind you that I work with all kinds of business owners in all kinds of situations. If you’ve been putting off asking for help because you feel embarrassed about the system—or lack of one—you’re using, hear this: One of my clients managed her books in the Notes app on her phone. You’re not alone.

Second, I want to give you hope. That same client didn’t fully understand what a bookkeeping software or system could do for her. But like we covered before, she did know that bookkeeping was important—and that’s already a step in the right direction. It’s better than doing nothing and avoiding it altogether.

That said, there are definitely better options than using your phone’s Notes app. And by the end of this, my goal is for you to walk away knowing that you can set up a system that’s simple, not overwhelming, and definitely not super techy.

We’re going to explore the pros and cons of spreadsheets versus some of the major players in the accounting and bookkeeping software world so you can feel confident about choosing the best system for your current phase of business.

Now, my perspective might be a little different from what you’ve heard elsewhere. For example, you’ll hear me say that, yes—sometimes a spreadsheet is totally fine. I’ve actually told clients who asked if it was time to upgrade to software that no, they’re not quite there yet. I believe in offering a balanced approach, and today, I’ll walk you through a few key things to consider.

You’ll want to think about where your business is right now, but also where you’re headed. Both of those things will impact whether a spreadsheet or software is the better fit.

So let’s get into it.

First up: the major options for bookkeeping software and systems.

The first is the classic spreadsheet—anything from Google Sheets to Microsoft Excel. This is actually a great starting point, especially if your business doesn’t have many transactions. Some people might be surprised to hear that from me, but it’s true—sometimes simple is best.

Next up is a popular app called Wave (like you’re waving hello). It’s well-liked because it’s free and cloud-based, which makes it really accessible. But there are a few things to be aware of. Because it’s a free service, it could be discontinued at any time without much notice. And since you’re not paying for it, there’s a chance you could lose access to your data. These are just a few of the pros and cons to weigh when considering Wave as your system.

Now, let’s talk about the other two major players in bookkeeping software — both of which are pretty much on equal footing: QuickBooks Online and Xero.

First, QuickBooks Online — not the desktop version. We really don’t recommend the desktop anymore because Intuit is phasing out support for it and has even threatened to discontinue it entirely. The desktop version might still be a good fit if you’re a non-profit since you can get it for free or at a steep discount. TechSoup offers non-profits discounts on QuickBooks Online. So if you’re a non-profit and want to learn more about that, feel free to reach out to me.

In general, though, I recommend steering clear of the desktop version and focusing on QuickBooks Online.

The other major player is Xero — spelled X-E-R-O. Xero is growing in popularity, especially internationally, and it’s gaining traction here in the U.S. as well. These are the bookkeeping platforms you’re most likely to hear about.

You might also hear about options like FreshBooks or even using a CRM (client relationship manager) system to handle bookkeeping. In my experience, these can work as a phase one solution, kind of like a spreadsheet. You can piece things together and it might work for a season, but it’s unlikely to grow with your business over time. You can rely on temporary solutions for a while, but recognize they might not serve you well in the long run.

People often ask me: When should I graduate from a spreadsheet to bookkeeping software? And how do I choose?

Well, a big factor to consider is the number of transactions you have. If you’re processing more than about 50 transactions per month, that’s often a good signal that it’s time to start looking into software or other more robust options.

So, why does using bookkeeping software matter?

When I say software, I mean platforms like Wave, QuickBooks, Xero—any of the accounting programs out there. What software really gives you is automation.

Automation is a game-changer because with these platforms—especially QuickBooks and Xero, which are a bit more robust than something like Wave—you can set up rules. For example, if you’ve categorized a certain expense like “software” before, the program will learn that and automatically predict that it should be categorized the same way next time.

This means you don’t have to manually enter every transaction into a spreadsheet anymore; the software starts doing that work for you. That’s a huge time saver and one of the main reasons to consider switching from spreadsheets to software.

When deciding what’s right for you, a key question is: How many transactions are you handling each month?

And also, How much time is this taking you? If most of your transactions are recurring monthly subscriptions, then yes, you might be able to just drag those across in a spreadsheet, and it’s not too time-consuming. But if you have a lot of one-time or irregular charges, manually entering all that data into a spreadsheet can become overwhelming.

This is where software shines because it connects directly to your bank account and can automate much of the transaction entry for you. Keep in mind, it’s not just the number of transactions but also how complex they are. More transactions or more complex ones usually mean more time spent categorizing. To clarify: when I say “transaction,” I simply mean any money coming in or going out of your business.

Here’s a practical tip — grab a bank statement from the last month (you can usually download this online), and do a quick count of your transactions. Are you around 50 transactions? Or closer to 350? That difference can have a big impact on how much time you’ll spend bookkeeping.

First question to ask yourself: How many transactions do you have?

Next, consider: How simple or complex is your business right now?

• Are you invoicing?
• Are you running payroll?
• Do you have inventory to track?
• How much detail do you want to see in your reports?

Sometimes when you’re managing bookkeeping on your own with a spreadsheet, it’s easy to just lump everything together—total sales here, total expenses there, maybe broken down into a few categories—and call it good. And honestly, that’s fine for a while.

But eventually, it becomes really helpful to dig a little deeper. For example, which of your packages or services are actually selling? It’s much easier to track that kind of detail in software than by manually sorting through a spreadsheet. You can also see which types of expenses are costing you the most.

If you’re handling your own invoicing and payroll, it can get tricky trying to piece together different tools for each. Using one system that includes invoicing, payroll, and inventory can simplify everything and save you headaches.

When you start needing all those features in one place, that’s a strong sign it’s time to graduate from your spreadsheet—or from juggling several smaller or free tools—and move to a more robust software solution that can grow with your business. That’s another important thing to consider.

The third point I want to really emphasize is this: Can the system grow with you?

As your business grows, can you easily add features like invoicing or payroll? Or will you need to juggle multiple apps and integrations just to get the reports and tools you need? It’s tempting to start with a free or simple version, and sometimes that’s totally fine for a season. But I want you to think ahead.

Eventually, you want a bookkeeping software and system that’s simple, easy to use, and able to grow with your business—before you get too far down the road. Otherwise, you might find yourself overwhelmed, suddenly facing thousands of transactions and still stuck on a free or basic version that can’t keep up.

Most of the time, I recommend making the switch during a slow season or at the start of the year. Why? Because if you switch mid-year, you’ll likely have to redo a lot of your work—recategorizing transactions or trying to manage two systems just to get your taxes done. That’s confusing and frustrating.

So think about timing, and where you are in your business growth. It might be time to upgrade—even if you don’t need all the fancy features just yet—because you’ll probably need them soon. That’s definitely something to keep in mind.

Now, the fourth question might surprise you a bit—especially since I’m a bookkeeping coach, not a bookkeeper—but it’s an important one: Do a variety of bookkeepers work with that software?

This is something people often miss. For example, Xero is definitely growing in popularity, but I don’t see as many bookkeepers who specialize in it yet. That means if you pick Xero, you might find yourself stuck without much support or fewer options when you want to outsource your bookkeeping.

The same goes for Wave, the free software. Most bookkeepers I know don’t work with Wave. If you get to the point where you want help, you might not find someone who’s comfortable with that system.

That’s why QuickBooks remains my favorite choice. It’s still the household name and probably the biggest player in the US market. (And yes, if you follow me on Instagram, you might see me throwing some shade at their customer support. I’ll be honest, it’s not great.)

That’s part of why I offer services—to save you from dealing with their frustrating customer service. You can just come straight to me for help.

But the main point is: QuickBooks has the largest network of bookkeepers.

This means you’re much more likely to find someone who can help you when you need it. I do support folks working with Wave as well. Keep in mind that switching from one system to another—like from Wave to QuickBooks—can get complicated and costly.

Sure, you might save money on subscription fees with Wave at first, but most accountants charge for converting your data. Plus, the time it takes to set up a new system, get organized, and learn the new software might make switching not worth it in the long run.

That’s why I always ask two important questions. 1. Can the software grow with you? 2. And do other bookkeepers work with it? Because going with the free or easiest option right now can sometimes cause headaches down the road.

So, we’ve covered how simple or complex your business is. We’ve talked about whether the software can grow with you, and whether lots of bookkeepers work with it. As I’ve said, my favorite is still QuickBooks Online. If you haven’t started using QuickBooks Online yet, don’t sign up just yet! I can get you a discount on the subscription fee, but right now, they don’t have direct links available, so it’s a bit tricky.

Just send me a message, and I’ll hook you up with the best discount currently available if you sign up through my link from the start. That said, I work with people in all kinds of bookkeeping phases—whether you’re still using spreadsheets, working with Wave, or using QuickBooks. Xero is the only one I haven’t personally worked with much yet. I do know some great people who can help if you’re using that system.

Now, to circle back to my client I mentioned at the start of this: she was doing her bookkeeping on her phone’s notes app. We got her set up with QuickBooks Online, and I check in with her every now and then. She openly admits she’s not a fan of numbers or complicated systems. She says QuickBooks has made her life so much easier—and her bookkeeping much smoother. Tax time feels way less stressful for her. She knows exactly who she needs to pay and who owes her, and she’s been really happy with that change.

So if you’re in a spot where you’re struggling to keep track of all the ins and outs of your business, please reach out and let me help.

Now it’s time for the definition segment of this blog!

Today, we’re going to talk about gross versus net. You’ll hear these terms a lot. Think of it this way: You start with the gross amount—the total before taking anything out. Then, you subtract certain things to get the net amount—what’s left over.

For example, with sales: Gross sales is every single dollar your business has brought in. Net sales subtracts things like any sales discounts you’ve given and the cost of goods sold. So, gross growth means all your sales or income combined, and net growth means that total minus some deductions.

You’ll also see this with income. You calculate gross income by adding up all your sales or revenue, and you get net income by subtracting your business expenses from that total. That’s how you get to your net income.

I hope this helped shed some light on whether it’s time for you to switch and graduate to an accounting program or software—or if you’re still good sticking with your spreadsheet.

As always, if you have any questions about whether it’s time to make the switch to a bookkeeping software for your unique situation, just reach out!

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