Hey there, friend! ? Are you starting a business and completely confused on how to get started with your bookkeeping?
Well, sharpen your pencil and pull out your notebook, because today we’re going to chat about how Xero can transform your business accounting into a full-on click party. Yep, once you get it all up and running, it can actually feel like you’re clicking your way through your bookkeeping in minutes!
And your bookkeeping big sis is right here with ya, with smiles and high fives along the way. ?
First things first, let’s get your business checking, savings, and credit card accounts all cozied up with Xero. This is simple to do right from your Dashboard in Xero. Simply enter your login information for each of your accounts (no personal accounts, only your business-related ones!), and pull back as many historical transactions as you can!
When your accounts are linked, it exports information from your bank or credit card directly to Xero for you to categorize. Buh-bye manually typing transactions into a spreadsheet!
Sometimes, certain bank accounts won’t let you import more than 3-months worth of information when you link it to Xero.
But don’t worry! Pull a CSV report with all of your activity for the missing months (like January – April if you linked everything up on May 1st, for example) and you can import it directly into Xero. Once that’s done, you’ll categorize everything directly from your bank feed, just like the transactions that are automatically populating already!
Setting up your chart of accounts in Xero before you start clearing bank feeds makes things soooo much easier – trust me!
Head over to the Chart of Accounts and add all of your different revenue streams (categories like Package One / Two / Three, or different products that you sell, etc.) Also add all of your expense categories, like Branding & Marketing, Contractors (bonus points if you create a separate category for each contractor team member so you can track how much you’re paying them!), Stripe / PayPal / Honeybook Fees (add whatever software you’re using), Software Subscriptions, etc.
Ah, the joy of organization! Everything is neat and tidy, exactly where you need it ?
Alright, here comes the fun part! Once you’ve got everything set up in Xero, it’s time for a CLICK PARTY. (That’s what we call it at MDB hehe)
Take some time to clear all of your bank feeds, one for each bank account or credit card that you have linked up.
Set up bank rules where you are starting to see recurring revenue and expenses, which will help speed up the bookkeeping process tremendously month over month!
But can we also give a standing ovation for the AI that Xero has been introducing the past year? The more you categorize, the more it understands what goes where, and it will actually start to suggest categories for you! I LOVE ITTTTT.
Last but definitely not least, let’s talk about formatting your Profit and Loss statement (P&L). Xero makes this so easy to do. You can group categories together (i.e. all 1:1 services grouped together, all coaching/mentoring categories grouped together, etc.) and you can move categories around based on where you want to see them.
This is where we LIVE when we are first onboarding our clients at MDB. We always make sure we are creating reports that work with our clients’ creative brains, not against them.
In conclusion, remember that financial management with Xero isn’t just about numbers and transactions; it’s about truly understanding how to use clear data to make decisions in your business.
If you’re doing it all yourself (go YOU!), but would love to lean on me and my team for questions, we’ve got our monthly bookkeeping membership – The Business Book(keeping) Club – ready for you! This is a place where you can ask questions, have 1:1 calls with professional bookkeepers for troubleshooting help and access to a huge library of (actually) helpful resource videos on how to do your bookkeeping. We would love to welcome you to the club!
OR if you find yourself setting this all up and you want to bang your head against a wall, take a deep breath and give it over to us. We love this stuff and we will take good care of it FOR you ?
Whatever you choose, know that we are here for you – kinda like a bookkeeping big sis. Let us know how we can help!