Keeping track of projects, and the time spent on those projects, is key for ensuring accurate billing. You can either assign hours to a project after the fact, or time a project live if you are completing a project for a client in real time. FreshBooks pricing begins at $15 per month for the Lite Plan and costs up to $50 per month with the Premium Plan. The pricing plans and structure are relatively similar to Xero’s plans. This article will discuss the main differences between Xero and FreshBooks by highlighting differences in features, price, and usability.
You have the option to either manually import data yourself or get a helping hand from your accountant. Another advantage of Xero is that it works easily with multiple currencies. This is perhaps the result of Xero being started by a New Zealand company where they are more used to working internationally than the U. If your company does a lot of business overseas, or may grow to do that in the future, Xero may be a better solution than Quickbooks. FreshBooks has simple, transparent pricing that fits your budget.
The ability to connect Xero to your bank account means you won’t have to move back and forth between two systems, entering and re-entering financial data. You can import and organize bank statements without leaving the software and reconcile statement lines with transactions in Xero. Another perk, Xero is one of Crossword Clue: single entry in a list Crossword Solver the leading alternatives to Quickbooks. If you’re looking to switch products, they can migrate your accounting data in as little as three hours. Important for service-based businesses, FreshBooks ensures you lose no billable time through dynamic time-tracking and generates invoices based on the logged time.
FreshBooks vs Xero: The Best Low-Cost Accounting Program for 2023
These features are ideal for a freelancer or a self-managing business owner. If you’re a freelancer or a very small business that doesn’t plan to expand rapidly, FreshBooks‘ time tracking, invoicing, and mobile features were made for you. If you run a growing or established business, sell inventory, and/or have a relatively large accounting team, Xero is better equipped to meet your needs. All Xero plans come with accountant access, but FreshBooks’ least expensive option does not. In the same vein, FreshBooks does not provide audit trails for accountants.
- On the surface, Xero seems to cover a wider spectrum of accounting features, which gives it a slight advantage over FreshBooks in terms of utility.
- Like several competitors, Xero provides tools to customize the look and feel of your invoices.
- That said, we have to conclude that FreshBooks is generally a better choice than Xero.
- Xero has some of the worst customer service we have ever experienced, particularly for a company of their size.
- In Xero, you can set invoices to repeat through the “sales” menu.
- Using straightforward dashboards and reports, companies benefit from accurate and valuable information.
It lets you enter bills, accept payments, issue invoices, and capture expense receipts. Our evaluation was based on a rubric scoring methodology in six categories, each with a designated appropriate percentage. FreshBooks integrates with several apps commonly used by small businesses, but its integration options aren’t as vast as Xero’s.
How We Evaluated FreshBooks vs Xero
The only way to assign expenses to the appropriate checking account is by matching transactions in the bank feed. Therefore, without a bank feed, you can’t designate which accounts to subtract expenses, making FreshBooks unusable if you have more than one bank account and no live feed established. FreshBooks is a bit complicated and limited in its banking features, especially with bank reconciliation. What we noticed is that FreshBooks deducts all entered expenses from the Petty Cash account manually.
It offers more features for a very similar price as FreshBooks, and many bookkeepers and accountants are trained in using Xero. With inventory management features that FreshBooks lacks, this tool is ideal for those that sell physical goods, though companies that require the utmost detail may find that it falls short. Xero is extremely well-priced for the functionality that you get, and we found it very easy to use in spite of it being one of the more advanced tools on the market. Bank transactions can easily go awry if not properly monitored, and more accounting software services are beginning to provide bank reconciliation options within their accounting tools.
Katelyn is a Junior Research Analyst at SoftwarePundit, where she conducts in-depth analyses of technology markets & products and writes software-related content. She graduated summa cum laude with degrees in English and Psychology. Her main areas of interest are content creation, user experience, and search engine optimization. Xero and FreshBooks are two accounting tools that we researched and tested in-house.
Suppose you have any questions with regard to cash flow, bookkeeping, expense tracking, and other accounting features provided by Xero. In that case, they have resources like articles, guides, walk-through videos, and guides all available for you either as a visitor or as a user. From buildings to copiers, many businesses have fixed assets on their balance sheet, but it’s rare to find the ability to manage them in cloud-based accounting software. At some point, every business will have to review how it’s performing. Analyzing inventory will tell you what’s moving and what’s sitting on the shelves.
- Xero offers basic accounting features and advanced tools for bookkeepers and accountants.
- Navigating from feature to feature is not difficult, but it has a small tick of having multiple access points to one feature, which can make the process feel repetitive.
- Many or all of the products featured here are from our partners who compensate us.
- There are only nine standard reports, and the sole financial statement it presents is the profit and loss.
- Danielle Bauter is a writer for the Accounting division of Fit Small Business.
Its intuitive design also helps users catch on to using it well. Phone support is available Monday-Friday from 8 am to 8 pm Eastern time. If there are a lot of fixed assets on your balance sheet, you might want to look closer at Xero. Its built-in fixed assets module calculates depreciation and books the journal entries for disposals. When you’re starting out, you can upload your fixed assets from a spreadsheet.
Mobile apps are evaluated based on their ability to perform certain tasks like invoicing, online payment processing, and expense receipt capture. FreshBooks and Xero allow assisted bookkeeping services to help small businesses in keeping the books organized. These bookkeeping services aren’t part of the subscription price, and you’ll need to pay an additional fee to get the service. FreshBooks and Xero aren’t at the same level of difficulty in terms of ease of use. FreshBooks is much simpler and straightforward, which is expected since the software caters primarily to people without accounting experience.
Xero’ business model is to get people ‘hooked’ and slowly up the price. Sometimes even charging for things that were already part of the product and calling it an add on feature. You are charged an additional month beyond your cancelation date. So either you have to plan to cancel 2 months in advance or you have to plan to pay an additional month of service after you actually cancel. Our support team is here to make switching to FreshBooks from any other software (even spreadsheets) super easy, with no interruptions to your business.
FreshBooks is a super-easy-to-use accounting software built specifically for small business owners, letting you easily do everything yourself. However, when it comes to using all the tools available to you as a small business owner, your accountant should definitely be part of your toolbox. You can also connect your bank account and credit cards to your FreshBooks account to automatically track your expenses. Plus, use bank reconciliation to ensure your accounts are accurate and up to date. Automatic Recurring Invoices in FreshBooks combined with Recurring Payments makes it simple for clients to pay and for you to accept payments for products or services rendered—hands-free. Recurring Payments works together with Recurring Templates to automatically bill clients every time an invoice is generated and sent.
Time and mileage tracking
However, it’s got all the required features to bill clients, track expenses, and manage projects. For a more in-depth overview of features offered by FreshBooks, check out the full FreshBooks review. Both FreshBooks and Xero are easy to use platforms that enable even those individuals with relatively little accounting and finance knowledge to access and navigate them easily. Both these software suites are a safe and secure way to manage your business’s accounting processes. Analyze the features and integrations offered by each of the services and choose one that suits your business needs. FreshBooks has its time tracking feature, considered one of the best in its class of accounting software.
FreshBooks’ 5 Best Features:
The exception to our recommendation is if your business is inventory-based, has a lot of fixed assets and relies on reports. Growing, Xero’s mid-tier plan, removes restrictions on the number of transactions you can process, but doesn’t add new features. Because it more than doubles in price, to $30, we prefer FreshBooks. The main “bills” screen in Xero presents the total of bills in draft form, awaiting approval or payment and overdue in boxes. Under that is a column graph that compares bills due with bills paid.