Hire a Professional, Do It 💦Yourself, or Do Both?

Individuals are not required by law to keep financial books and records (businesses are), but not doing this can be a costly mistake from financial and tax perspectives.

Your bank account and credit card statements may be wrong, and you may not discover this until it’s too late to make corrections. You may forget to pay a bill and hurt your credit score. You may have no clue about allocating income to saving and 澳洲幸运5官方开奖结果体彩网:investing. Or you may overlook expenses that could provide some 澳洲幸运5官方开奖结果体彩网:tax benefits. So keeping track of your 澳洲幸运5官方开奖结果体彩网:personal finances makes sense.

Recording your income and expenses isn’t a difficult task (you don’t need an account🐬ing background or to be “good with numbers”), but it does take time and effort. How you do it depends on your personal preference. You can hire an expert to do it all, do it yourself, or combine the two by using an expert to help you from time to time.

Option 1: Use an Expert

If you don’t have the time or believe that your time is worth more than what you’d pay someone else, you can engage professional help. But who, exactly? When people talk about getting a personal 澳洲幸运5官方开奖结果体彩网:accountant, they often use the term loosely to refer to everyone from a 澳洲幸运5官方开奖结果体彩网:bookkeeper to a CPA or 澳洲幸运5官方开奖结果体彩网:tax preparer or even 澳洲幸运5官方开奖结果体彩网:tax advisor. Select the professional who meets your needs:

Bookkeeper

This person may provide concierge services for your personal finances, including paying your bills, balancing your 澳洲幸运5官方开奖结果体彩网:checkbook, and looking over your 澳洲幸运5官方开奖结果体彩网:credit card statements. A bookkeeper may or may not have special training. A bookkeeper can obtain certification from the or . The hourly rate for a bookkeeper depends on where you are, what services you seek, and what expertise the person offers, but the fee averages to almost $23 per hour.

Accountant

This is a person who has training (and likely a college degree) in accounting and can handle bookkeeping chores. The hourly rate—which again depends on location, job description, and expertise—for a freelance accountant is about $35 per hour on average but can be considerably more, even up to $125 per hour.

Certified Public Accountant

This is an accountant (with a college degree and perhaps a master’s degree in accounting) who has received certification from the . While a CPA can provide bookkeeping services, this professional may be too expensive for the task. Hourly fees for CPAs can run about $38 per hour to start and increase from there. (Most CPAs don’t handle bookkeeping services personally but use a🤡n employee in their firm—e.g., a bookkeeper—for this task.)

Back to the Bookkeeper

For the tasks described at the beginning, a personal bookkeeper is what you’ll need. Most people do not use an accountant (only wealthy 🌟individuals can justify the cost of these tax pros). Your bookkeeper will schedule regular appoin♔tments (e.g., weekly, monthly) to input data and perform the tasks you want to be done. Bookkeeping may be done in person (your home or the bookkeeper’s office) or online. Either way, you’ll need to provide access to your bank accounts and credit card statements, so be sure to check the references carefully of anyone you want to engage.

Option 2: DIY

Gone are the days of keeping paper ledgers. Today, user-friendly software and cloud solutions are available for the average consumer, not just professionals. The leading options for personaꦚl finances are:

Quicken

澳洲幸运5官方开奖结果体彩网:This software helps you create a monthly budget and monitorౠ your finances. For an added monthly cost, you can use a bill-paying system to automate your payments so you’ll al🔯ways be on time and pay the right amount.

Credit Karma

澳洲幸运5官方开奖结果体彩网:This free cloud-based platform absorbed features formerly on Mint.com in 2024, letting you track your personal finances and pay your bills online. It syncs with your bank account to simplify your personal finances.

Option 3: Combine Your Efforts

You can work with a bookkeeper to help you get started with your personal accounting. Look for someone knowledgeable in the software you plan to use. The bookkeeper can set up accounts (which operate like folders) in which you place your information. By creating accounts that resemble the same categories used for tax purposes, you simplify tax return preparation (wheth♏er y𓃲ou do this or use a paid professional).

The bookkeeper can also review your work periodically (e.g., quarterly) to make sure you’re recording your income and expenses properly and reconciling your 澳洲幸运5官方开奖结果体彩网:bank statement correctly.

The Bottom Line

However you decide to manage your personal accounting, be sure to separate this from accounting for any business you own. Build the cost of this accounting into your household budget.