Virtual Bookkeeping as a Side Hustle

Nearly every business needs bookkeeping services, whether it be the personal bookkeeping of a self-employed person or a larger company. However, they can only sometimes afford a full-time on-staff employee, so they turn to freelancers and independent contractors. This allows business owners to spend time doing what they do best—running their company.

This is another side hustle opportunity for those who have the skills to do so or are willing to learn them.

Kate Johnson, the founder of Heritage Business Services in Virginia Beach, VA, left corporate finance life to become a virtual bookkeeper in 2017. With a Bachelor’s Degree in Economics, an MBA from Yale, and a love for numbers, she also needed a business that could fit into her life as a Navy wife and mom to three children.

“This virtual bookkeeping business allows me to leverage my innate abilities and also to have flexibility with and where I do my work,” she states in her online bio.

After answering a finance question in a Facebook group about making extra money as a bookkeeper—and getting lots of requests for more information on how to do it—she created her own Facebook group called the Bookkeeping Side Hustle community. The community is a collaborative and educational forum featuring interviews, an e-book, and a growing community for accountants. The group now has over 22,000 members.

How To Start – Entrepreneur vs. Work for Someone Else

There are two ways to undertake a bookkeeping side hustle—either being an entrepreneur and starting an independent business or choosing to work for someone else. Determining which one works best is an important decision in the process.

Johnson has written a Guidebook on how to become a part-time bookkeeper with four main steps on how to do it: Learn accounting, learn bookkeeping software, set up your business, and then get clients. The Guidebook was designed for those choosing the entrepreneurial route, which is not for everyone.

“There’s nothing wrong with giving up a little bit of the upside that comes with entrepreneurship to have a good steady book of business that you are doing for someone else,” she shares. “I say that message a lot in my group.”

Johnson says there are multiple ways to get new clients, including a personal network, social media, and referrals from other clients for those on the entrepreneur track.

In her early days, personal connections were the key. “My first clients all had a direct connection with me,” she says. “So, make sure everyone you know knows that you’re starting a bookkeeping business.”

Now, much of her side hustle business comes from an online presence. On her YouTube channel, she features tutorials on bookkeeping software, among other things.

“I use videos on YouTube to get clients. Now I am trying to use that as my business card—my calling card,” she says. “Most of my incoming, inbound inquiries say they found me on YouTube.”

For those opting to work for someone else, many bookkeepers, such as herself, need more help to handle the client load and often need to hire a freelancer. To this end, every other week on Saturday, she publishes a newsletter including a list of freelance jobs, working for another bookkeeper, such as herself.

Payment and Income

According to Johnson, there is more than one method to charge clients for bookkeeping. It can be done based on an hourly or monthly rate for a regular steady client. Her baseline monthly bookkeeping is $200 for basic books, and her highest-paying client is $495 per month. She currently has six monthly clients and still only works part-time.

“I provide a monthly bookkeeping rate for clients for a fixed fee no matter how long it takes me,” she says. “I have gotten better at it, and I have tools that help me get my job done faster.”

For bookkeeping cleanup projects, as she calls them – where one is repairing accounts that are bad – she earns on average between $1000 and $2000 and does about four to eight cleanups per year. As some bookkeeping cleanup projects are more complex than others, bookkeepers can charge a lot more for these types of projects.

In her case, which is unique, she also receives income from being a side hustle influencer, coaching other individuals and companies about virtual bookkeeping. Her hourly rate is for that is typically $125 per hour. While she makes more money from this side of her income, she explains that most people undertaking this side hustle are going to be straight accounting professionals doing the nuts and bolts of bookkeeping solely.

“I am a real bookkeeper and would easily be able to do more client work if I didn’t do the ‘bookkeeping side hustle activity,’” she notes. “You can still make very good money doing it that way, and you don’t have to be an influencer.

Considerations

While an accounting degree or extensive experience is not required to become a bookkeeper, there are still factors to consider before starting the role as a side hustle.

Johnson recommends the following basics before following the path to virtual bookkeeping:

• Get an accounting textbook and/or take an online accounting class
• Do the first accounting by hand without software
• Learn how to use cloud-based software such as FreshBooks or Quickbooks
• Study accounting basics.

She stresses it’s a high-skilled side hustle, and it’s essential to at least study and be willing to study some basic skills. “If you don’t take that to heart, you’re going to be a bad bookkeeper, and you’re dealing with the business owners’ livelihoods,” she states.

Choosing whether to become an entrepreneur or work for another bookkeeper—with no pressure to seek out new clients constantly—is also an important factor.

For those who have a love for numbers and math and a willingness to learn a few new skills, virtual bookkeeping could be a potential side hustle. The demand is high for individuals and businesses looking for help with their accounting. Grabbing a piece of that pie is ready for those looking to pad their bank account while managing others' accounts.

This article was produced and syndicated by Wealth of Geeks.