3 Bookkeeping Productivity Tips
In a recent post, I wrote about how to charge for bookkeeping services. I mentioned that a downside of hourly billing is that there's no incentive to get more efficient.
If you find a way to achieve four hours of work in only two, all you've done is cut your invoice in half. In that scenario, having an arsenal of bookkeeper productivity tips isn't all that useful.
Once you start billing based on what you're delivering to your clients, that's when you want to save time on your important tasks. Ever since I made my bookkeeping business fully remote in 2010, I have been obsessed with productivity. I'd like to share some basic concepts I've learned over the years that I hope will help you and your bookkeeping practice.
What productivity doesn't mean?
Being productive means getting the same high-quality client work done in a more efficient way. It does not mean cutting corners in order to take a longer break or bill your client for work you didn't complete.
If you are trying to grow your company, you need to have a very long-term approach. Providing great service to your clients makes them come back year after year. And a happy client will send you new clients through referrals. This is worth far more than a few inflated invoices and a trail of angry clients.
Bookkeeping Productivity Tips
Tip 1: Group similar work into batches.
We all do amazing things for our clients, but let's not kid ourselves into thinking we're artists. Most of our days are spent doing the same tasks over and over again. Whether you have 1 or 101 clients, this tip will save you a ton of wasted time.
Within the workload of repetitive tasks, we can divide these up into certain groups. It won't be the same for everyone, but here are some general guidelines.
- Entering bank transactions
- Managing bills
- Sending out invoices
- Checking email
- Updating your website
- Professional development (eg. Attending a webinar, renewing your certification, etc.)
There are plenty more, but you get the idea. You can try to do a little bit of each of these every day. However, this is not an efficient workflow. And, even worse, you might still be behind schedule by the end of the week. Instead, try batching these tasks.
What is batching?
As an example, let me show you how I process Accounts Payable throughout the week.
Monday: A lot of bills will arrive throughout the week and even through the weekend. I process all of them on Mondays. By process, I mean I enter them into a payment system. In my case I usually use BILL. The bills arrive in my BILL inbox, and all I'm going to do on Mondays is get them categorized and queued up for approval. I usually need the client to go in and approve the bills before they get paid.
Tuesday: Although BILL sends a message to each approver immediately, not all of my clients check their messages regularly. And, sometimes I need other approvals outside of BILL first. On Tuesday, I spend a few minutes sending out messages and reminders to let everyone know they have bills to approve.
Wednesday: This is bill payment day. By now 95–100% of the bills in the system have been approved and are ready to be paid. I log into BILL, and five minutes later all of the bills have been paid.
I know what some of you are thinking. Wouldn't it be quicker to just do all of this in one day? Absolutely not. If I did all of this on Monday, I would get 40–50% of the bills paid. And, I'd be constantly checking email or Slack for replies. That time waiting for other people is time I could be spending on other work. This way I get the work done quickly, and my system allows the client to take up to two days to respond without causing me to spend any time waiting for them.
Other ways to batch your tasks.
Email: Block out time twice a day to check and respond to email, Slack, etc. Depending on your volume, this could be 5–60 minutes. Get through as much of it as you can, and don't leave it open throughout the day.
Professional Development: Take a whole day for to improve your bookkeeping skills. If you read an old post I wrote about going to a four day client workweek, you'll know I try to devote Fridays to working on my business. Some weeks that means updating my website or writing blog posts. Other weeks that means I will take a course to further my skills. It's also a good time to refresh your certifications.
- Meetings: The only thing worse than five meetings in a week is one a day for five days. They always get scheduled right in the middle of when I get my best work done. Instead, I try to book my meetings on one or two days of the week. I know this isn't always possible, so do your best. Even if you just keep one day as a no-meeting day, you'll be glad you did.
Tip 2: Boost productivity with automation.
Bank rules
Why on earth would you do the same tasks over and over again if you can get your bookkeeping software to do it for you? If you use QuickBooks Online or Xero, you should know about bank rules. Let me know if I should write a post about them.
A lot of the bank and credit card transactions that show up follow a similar pattern. The gas station is always Travel, and Staples is always Office Supplies. By setting up bank rules, you tell the software to always categorize Staples as Office Supplies.
Be careful, though. As I mentioned before, one of the common bookkeeping mistakes is to skip the review process. In QuickBooks Online, this is especially true. In QBO, you can set the bank rules to be accepted automatically. In Xero, they will be categorized, but you still have to click "OK" on each one. You'll want to review the transactions to ensure the $7 at the gas station was fuel and not lottery tickets.
Email filters
While you're batching your email, wouldn't it be great if it was 5 minutes a day instead of 60? Most email clients let you create some type of rules. In Gmail, they call them filters. Just like bank rules, you set up instructions for how certain messages should be handled.
The time you devote to checking email should be spent wisely. This is when you reply to a client who has a pressing issue. Not spending 20 minutes moving coupons into the trash and half-reading newsletters.
Step 0 is to stop receiving emails you don't want. As Merlin Mann says, never organize your garbage. Unsubscribe from all of the store emails you never shop at and the newsletter from the school your kids stopped going to years ago. Once you've done that, here are some filters to set up as quick wins.
- File all of the flyers you actually want into a "Deals" folder that you can look up when you're on that site buying something.
- Move newsletters into their own folder so you can read them at night or on the weekend when you have more time.
- Have emails from your clients go directly into a priority folder. This means you can skip the inbox entirely and go straight to messages that may need a quick response.
Document automation.
If you still have to deal with a lot of files that end up spread across your desktop, downloads folder, and who knows where else, let me introduce you to my friend Hazel. Hazel is a tool that is so powerful it deserves its own post someday.
This one is just for Mac users, but I believe something called File Juggler is a Windows alternative. Basically, like bank or email rules, you can set up rules for folders on your computer. Hazel will watch those folders and execute the rules based on the schedule you set up.
You can start off really basic, like:
- Any files in the Downloads folder that are more than ten days old get sent to the Trash.
- Any image file that starts with "Screenshot" goes into an archive with all my screenshots.
But you can set up more complicated rules like:
- Any PDF that I download from my bank's website goes into a Banking folder and gets renamed based on the date I downloaded it and the URL it came from.
- There are so many crazy options available to you, especially if you can do a bit of scripting too.
I need to write a post just on Hazel. If you want to dig into it further, MacSparky has a great course called the Hazel Field Guide that goes through all of the ways you can automate your files and folders.
Tip 3: Learn your keyboard shortcuts.
If you had to guess, what percentage of your time at your computer is spent with one of your hands on your mouse? What about with both hands on the keyboard?
If the first answer is bigger than the second answer, you can improve your productivity by learning a few keyboard shortcuts.
Every app worth using has at least a few built-in shortcuts. Let's take Gmail as an example.
First, enable keyboard shortcuts. Click the gear icon at the top right and the click "See all settings". On the first tab, scroll down until you see keyboard shortcuts and make sure it's enabled. I have included a screenshot.
Now, most of the actions you perform in Gmail can be done with your keyboard.
Once you're in the Inbox:
- J and K move up and down the list of messages.
- O opens the selected message.
- R to reply, F to forward, A to reply-all (do so wisely).
- E to archive, L to attach a label, or V lets you attach a label and archive all at once.
- G, then I get you back into the Inbox.
- C to create a new message.
Here's the full list: Gmail keyboard shortcuts
Here are links for some of the bookkeeping apps you might be using.
Final thoughts on productivity.
Your high-priority tasks deserve your time and attention. The adjusting entries before you can send the books to the accounting firm at year-end. That's where you need to focus your energy. By using up less time on those other tasks, you can focus on what's important.
We have powerful technology available to us today. Wait until my post about bookkeeping and AI. By setting up a few of these processes, you can get so much more work done in the time you're given.
What's next?
- If you have tips or processes of your own, post them in the comments.
- If you want to get my next post as soon as it comes out, please subscribe to the newsletter.
- If you need help with the bookkeeping or productivity in your business, please contact me.
