FreshBooks Review for 2020: The Ultimate Guide to FreshBooks Accounting Software

Use our FreshBooks review to determine if FreshBooks accounting software is right for your business.

FreshBooks Review: Everything You Need to Know About FreshBooks Accounting Software

Choosing the right business accounting software can be essential to automating and optimizing your operations—regardless of the size of your business. Whether you’re a freelance contractor or small business owner, therefore, you might be considering a cloud-based solution like FreshBooks that can accommodate your bookkeeping and accounting, as well as related business process needs.

Known for their user-friendly and mobile platform, FreshBooks accounting software offers three different service plans with a range of features, from invoicing to time tracking to project budgeting. However, with all of the accounting software options on the market, you might be wondering: Is FreshBooks accounting software right for my business?

This FreshBooks review is here to help you find out. We’ll discuss FreshBooks pricing, features, and top alternatives—this way, you’ll have all the information you need to determine which accounting solution will best fulfill your business’s needs.

FreshBooks Review: The Basics

Before we dive into the details of FreshBooks accounting software features, let’s start this FreshBooks review by breaking down the basics.

As we mentioned, FreshBooks is web-based accounting software, meaning you can access your account anywhere you have internet access. Designed to accommodate business owners on the go, FreshBooks can also be easily accessed via a browser on your mobile device, as well as using the FreshBooks mobile accounting app for iOS or Android.

With FreshBooks accounting software, you can choose from three subscription plans, differentiated first and foremost by the number of billable clients they allow. On the whole, however, you can expect to receive the following capabilities from FreshBooks accounting software:

  • Customizable, professional invoices
  • Automated bank import
  • Accept credit cards and ACH bank transfers online
  • Dashboard to track and manage your account
  • Expense management
  • Estimates
  • Time tracking
  • Secure data storage with SSL encryption
  • Project budgets
  • Reports and insights
  • Over 200 third-party integration options
  • Customer service via phone and email
Pros
  • Overall capabilities
  • Mobility
  • Usability
Cons
  • Charges for each users
  • Client-limitation
  • Pricing

FreshBooks Reviews: Features

With this overview of FreshBooks in mind, the next step in this FreshBooks review is to explore the different features this accounting software has to offer.

FreshBooks Accounting

With the FreshBooks accounting software, you’ll be able to attach your business bank account and automatically import activity into FreshBooks in order to manage your essential bookkeeping and accounting tasks, including:

  • Bank reconciliation: use the automatic bank import to match account activity against your financial records
  • General ledger: get a complete record of all your financial accounts and transactions
  • Profit and loss: generate a profit and loss statement to show total income and expenses
  • Accountant access: grant your accountant access to specific features and reports within your account
  • Sales tax summary: view a summary of all the sales taxes you’ve paid and collected in any given period
  • Accounts aging: view a summary of overdue invoices
  • Expense report: generate a detailed breakdown of your expenses during any given time frame
  • Invoice details: receive an overview of your invoicing, with filters for date, range, client, and status
  • Chart of accounts: create a customized report of every account and balance in your system
  • Balance sheet: review your balance sheet, detailing assets, debts and liabilities, owner and shareholder equity
  • Cost of goods sold: track the cost of doing business, assign a cost of goods sold category to specific items
  • Trial balance: get a list of balances for each general ledger account
  • Other income: log unique and other income items
  • Journal entries: create manually entered journal entries for one-off transactions

FreshBooks Invoicing

In addition to these accounting capabilities, FreshBooks accounting software will also give you the ability to send professional, customized invoices to all of your clients.

FreshBooks’ built-in invoice software includes:

  • Customizable invoices with personalized templates, colors, fonts, and logos
  • Automatic, customizable payment reminders
  • Automatic late fee option
  • Potential to accept credit card payments on invoices
  • Add tracked time and expenses to invoices
  • Recurring invoices
  • Due dates for invoices
  • Received invoices folder
  • Discounted invoices
  • Deposits on invoices
  • Preview before sending option
  • Multi-currency billing
  • Multi-language invoices
  • Duplicate invoices
  • Automatic tax calculations
  • Simple summary of invoices
  • Retainers
  • Invoice on the go with FreshBooks mobile app

FreshBooks Expenses

In order to perform your business bookkeeping and accounting, you need to be able to track your expenses.

With FreshBooks, you’ll have access to expense features such as:

  • Receipt capture and attachment
  • Tax-friendly expense categories
  • An easy-to-read summary of spending by category
  • Remembered vendors to log expenses quickly and easily
  • Multi-currency ability to track expenses regardless of currency
  • Editable expenses

FreshBooks Estimates and Proposals

FreshBooks accounting software will allow you to generate estimates and send proposals to your clients.

More specifically, you’ll be able to:

  • Create proposals that outline a project’s scope, timeline, and deliverables
  • Enable your clients to approve and sign proposals online using e-signatures
  • View and respond to client feedback on proposals within FreshBooks
  • Create and email an estimate anywhere using the FreshBooks mobile app
  • Convert estimates to ready-to-pay invoices after client approval

FreshBooks Time Tracking

Whether you’re managing your own hours or the hours for an entire team, FreshBooks accounting software will give you robust time-tracking capabilities.

FreshBooks time tracking features allow you to:

  • Generate daily breakdowns of your time
  • Track your hours and bill clients accordingly, adding the logged hours to their invoices
  • Track time for everyone on your team
  • Log hours
  • Track hours using the built-in timer
  • Track time against specific clients or projects
  • Download the Chrome web browser extension to track time inside other apps like Basecamp and Trello

FreshBooks Projects

To extend your functionality beyond the realm of core accounting, FreshBooks offers project-specific features to help with productivity and the streamlining of your processes.

With these project tools, you’ll be able to:

  • Invite employees, contractors, and clients to collaborate on projects in FreshBooks
  • Upload documents to FreshBooks for file sharing and accessibility
  • Start team discussions and maintain the project conversations within FreshBooks
  • Set due dates for projects
  • Review your ongoing initiatives with project overviews

FreshBooks Payments

On top of their in-depth invoicing functions, FreshBooks accounting software also provides payment capabilities, allowing you to receive payments for your invoices quickly and easily. These payment features include:

  • Use FreshBooks Payments or Stripe to accept payments online
  • Accept credit cards, ACH bank transfers, Apple Pay
  • One-click payment acceptance on invoices
  • Automatic payment recording
  • Automatic expense recording for transaction fees
  • Recurring payments and auto-bills
  • Accept international payments using Stripe
  • Automatic payment reminders and late fees
  • Create project deposits
  • Option to buy FreshBooks Advanced Payments add-on, which offers virtual terminal capabilities

FreshBooks Reporting

As we mentioned in regards to the FreshBooks accounting-specific features, this solution offers a variety of reports to provide you with insights on your business’s financial data.

FreshBooks reports are easily accessible from your Dashboard and can be used to expedite your tax processes. These reports can also be filtered by client, team member, or date, as well as saved, exported or printed to share with your business accountant.

FreshBooks reports include:

  • Profit and loss report
  • Sales tax summary
  • Accounts aging report
  • Payments collected
  • Accounting reports
  • Expense report
  • Invoice details report

FreshBooks Clients

As an accounting software provider that differentiates plans based on the number of billable clients (as we’ll discuss in greater detail shortly), FreshBooks also offers client-specific features.

To help you optimize your communication and better your relationships with clients, FreshBooks includes:

  • Contact information storage that syncs across devices
  • Relationship feed of invoices and communication for each client
  • Internal notes to add to client contacts
  • Remembered common clients for easy access when invoicing
  • Easily editable client profiles for updating and changing information

FreshBooks Mobile and Integration Options

As we mentioned earlier, FreshBooks offers both a mobile app for managing your accounting on the go, as well as integration options with hundreds of third-party tools.

The FreshBooks mobile app is available for both iOS and Android, and although you can’t access every feature of your web account, you can:

  • Create and send invoices
  • Capture receipts
  • Manage expenses
  • Chat with clients
  • Receive notifications
  • Sync data across devices

In terms of integrations, on the other hand, FreshBooks accounting software offers tools that range from CRM software to inventory management apps to payroll software and more. Some noteworthy apps available in the FreshBooks marketplace include Gusto, Google Suite, Bench, Hubspot, Zapier, Shopify, and Slack.

FreshBooks Review: Pricing and Plan Options

As you can see, FreshBooks accounting software has substantial functionality to offer, starting with essential bookkeeping and accounting tools and expanding into project, client, and overall financial management.

That said, the specific features you receive with FreshBooks will vary based on which of the three FreshBooks subscription plans you choose.

Let’s break down the details of these plans—discussing not only what capabilities each offering includes, but breaking down FreshBooks pricing as well.

1. FreshBooks Lite

The first, most affordable plan option from FreshBooks is FreshBooks Lite.

This version of FreshBooks accounting software is well-suited for micro or very small businesses. In particular, FreshBooks Lite would be a worthy home-based business accounting software option, as well as a great option for freelancers or contractors.

As the most affordable of the FreshBooks plans, Lite is also the simplest, with fewer features and greater limitations compared to the other two offerings.

For a limited time only, FreshBooks is offering 50% off the Plus and Premium plans for the first 3 months when new users skip the 30-day free trial period.

Let’s explore further:

FreshBooks Lite Pricing

If you pay for the Lite plan on a monthly basis, the FreshBooks pricing will be $15 per month. On the other hand, if you opt for an annual plan, you’ll save 10% and the monthly cost will be $13.50.

Additionally, if you want to add team members to your FreshBooks account, you can do so for $10 per user per month.

Moreover, if you want to enable FreshBooks Payments or Stripe to accept credit card payments, you’ll pay a per-transaction fee of 2.9% + $0.30 for credit cards and a 1% fee on bank transfers.

FreshBooks Lite Clients

With FreshBooks Lite, you’ll be able to attach five active clients to your account at any given time.

FreshBooks Lite Features

With this version of FreshBooks accounting software, you’ll have access to:

  • Unlimited invoices
  • Unlimited expense entries
  • Unlimited time tracking
  • Unlimited estimates
  • Ability to accept online credit card payments and ACH transfers
  • Automatic expense importing from bank accounts
  • Reports
  • Custom functionality and workflows with over 200 integration options

2. FreshBooks Plus

The second FreshBooks plan option, FreshBooks Plus, offers a step up from the Lite version.

Plus is the most popular version of FreshBooks accounting software—and with additional features and greater client accommodation, this is a solid solution for a variety of small businesses.

FreshBooks Plus Pricing

The FreshBooks pricing for the Plus plan is $25 per month if you subscribe on a monthly basis, or, if you subscribe for an annual plan, you’ll pay 10% less, at $22.50 per month.

Just as is the case with the Lite version, if you want to add team members to FreshBooks Plus, you’ll have to pay $10 per user per month.

Similarly, if you accept credit card payments or bank transfers with this plan, you’ll face the same 2.9% + $0.30 and 1% transaction fees, respectively.

With the FreshBooks Plus plan, however, you also have the option to buy FreshBooks Advanced Payments, where you’ll have access to a virtual terminal to accept payments manually or over the phone. This add-on will cost $20 per month.

FreshBooks Plus Clients

If you opt for this version of FreshBooks accounting software, then you’ll be able to attach up to 50 active clients to your account at a time.

FreshBooks Plus Features

With FreshBooks Plus, your account will include all of the features of the Lite plan, as well as:

  • Unlimited proposals
  • Automated recurring invoices
  • Double-entry accounting reports
  • Scheduled late fees
  • Automated late payment reminders
  • Client retainers

3. FreshBooks Premium

Finally, the best FreshBooks option for high-volume, high-activity businesses is FreshBooks Premium.

FreshBooks Premium is, of course, the most expensive of the three plans, but for this price, you’ll have the greatest flexibility with your accounting software.

FreshBooks Premium Pricing

The FreshBooks pricing for the Premium plan is $50 per month. Just like the Lite and Plus options, if you choose to pay for a full year of FreshBooks Premium, you’ll receive a 10% discount and only pay $45 per month.

Similarly, like the other FreshBooks plans, it will cost 2.9% + $0.30 per transaction for credit card processing and 1% per transaction for bank transfers. If you’d like to opt for FreshBooks Advanced Payments, you’ll pay an additional $20 per month fee.

Moreover, if you want to add team members, you’ll pay an additional $10 per user, per month.

FreshBooks Premium Clients

The number of billable clients is the only differentiator between FreshBooks Plus and Premium. The Premium plan can accommodate up to 500 clients.

FreshBooks Premium Features

As we mentioned above, the number of clients is the only difference between the Plus and Premium plans. Therefore, FreshBooks Premium includes all of the capabilities of both the Plus and Lite versions.

FreshBooks Select

Although not part of their standard plan offerings, FreshBooks also offers a solution for businesses whose accounting needs go beyond the Premium plan. This service, called FreshBooks Select, is available on a quote basis by contacting FreshBooks directly.

With FreshBooks Select, you’ll have access to advanced billing, tracking, and invoicing features. Additionally, this solution will include a personal account manager, customized training for you and your team, QuickBooks and Xero integration, as well as lower credit card transaction rates.

FreshBooks Pros and Cons

FreshBooks Pros

With all of the details of FreshBooks pricing, plans, and features laid out, let’s consider what these specifics might mean for your business.

Let’s continue our FreshBooks review by starting with the positives: What are the main advantages to opting for FreshBooks as your business’s accounting software?

Here are a few points to consider:

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Overall Capabilities

Overall, regardless of which version you opt for, FreshBooks accounting software has an impressive list of features and capabilities.

Plus, in addition to the typical accounting tools you need for sending invoices and managing expenses, FreshBooks also provides functionality for time tracking, client communication, and project management.

All of these capabilities can truly influence how you optimize your processes, giving you the ability to manage multiple facets of your business within one software platform.

Mobility

Moreover, between their web-based software and mobile app, another of FreshBooks’ most notable benefits is mobility. FreshBooks is designed to accommodate business owners on the go, who need access to their accounting software regardless of location.

With the FreshBooks mobile app, you can utilize the majority of your plan’s features right from your smartphone, or you can even use the web version of FreshBooks from a mobile browser.

Plus, all of your data syncs across your devices, so you don’t have to worry about transferring any information as you go.

Therefore, if accessibility is particularly important to you in regards to your accounting software, FreshBooks can offer this advantage.

 

Usability

Just as FreshBooks mobility is a significant advantage, so is the platform’s overall ease of use. By all accounts, FreshBooks accounting software is intuitive, flexible, and user-friendly, regardless of your previous accounting or business experience.

Therefore, it’s quick and easy to get set up using FreshBooks and won’t take you an extended amount of time to figure out how to make the most of their platform. Plus, if you have any questions or issues, you can contact FreshBooks customer service via phone or email, as well as explore the support resources they include on their website.

This being said, FreshBooks is a great option for business owners who don’t have substantial accounting experience, as well as those who truly want to save time by choosing a platform that is quick and easy to set up and put to use.

 

FreshBooks Cons

Keeping these advantages in mind, let’s discuss the areas where FreshBooks accounting software is lacking. Although these drawbacks may not disqualify FreshBooks as an option for your accounting software, they’re nevertheless worth considering as you compare FreshBooks to other accounting solutions on the market.

Let’s explore further.

Single User

It may seem like a small point, but if you want your team to have access to your accounting software, it’s certainly a drawback that FreshBooks charges you an additional monthly cost for each user you want to add, regardless of which of the three plans you choose.

If you need multiple users, therefore, FreshBooks pricing can grow quickly. Comparing FreshBooks to other accounting software options, some solutions—like Wave or Xero accounting—include an unlimited number of users with all of their plans, at no additional cost.

Client-Limitation

Another possible drawback of FreshBooks accounting software is their client limitations. As we discussed above, the three plans are largely differentiated by the number of billable clients they can accommodate.

This qualification is certainly restrictive, especially if you don’t need the additional capabilities of say, the Plus plan, but have more than five billable clients. In this case, you would have to pay the extra $10 monthly, even if you only have seven billable clients.

Similarly, the only difference between the Plus and Premium plan is the number of clients they each accommodate, and yet—the Premium plan is twice as expensive.

When it comes to other accounting software solutions, some break down their plan levels simply based on capabilities, where others, like Wave Accounting, only offer one accounting platform with add-on options. This being said, if you only need basic features in your accounting software, but have many clients, you may want to consider a FreshBooks alternative.

Pricing

Finally, although FreshBooks pricing is not the highest out there, it certainly isn’t the most affordable either. For $15, the Lite plan includes significant functionality, and yet, only accommodates five clients—which, as we mentioned above, is a definite drawback.

Similarly, even though the Premium plan can offer more clients on top of a rich feature-set, at $50 (and more for multiple users), you may opt for a solution that includes even more capabilities, like QuickBooks Online.

Moreover, if you only need the core accounting tools of the Lite plan, you might opt for a solution like Wave, which can provide FreshBooks’ mobility, ease of use, and essential features—but with no monthly fee.

Top Alternatives to FreshBooks

Before you decide whether FreshBooks is the right accounting software for you, it’s worth taking a look at other solutions on the market. Whether you need a more affordable option or a platform that can provide additional tools, like inventory management, there might be a FreshBooks competitor that will work better for you.

Here are three top alternatives to consider:

Zoho Books

If you’re looking for a FreshBooks alternative that is more affordable and can accommodate more clients but has similar capabilities, you might consider Zoho Books.

With the most basic of Zoho Books, you’ll be able to add 50 contacts, two users, and create five automated workflows. You’ll also have functionality such as bank reconciliation, custom invoices, expense tracking, projects, and timesheets. This plan is very similar to FreshBooks Lite—but at $9 per month, is less expensive and allows for more users and clients.

Moreover, with the two higher-level Zoho Books plans, you’ll have access to even more users and clients, as well as additional features like purchase orders, inventory, and bills. Plus, at $19 and $29 per month, these Zoho Books options are certainly more affordable than the different versions of FreshBooks.

Therefore, Zoho Books is a worthy alternative to FreshBooks accounting software if you’re looking for fewer limitations, at a more affordable monthly cost.

 

Wave

On the other hand, if you’d prefer a completely free accounting software option with impressive built-in functionality, you might consider Wave.

Wave is one of the only true, free accounting solutions on the market, and nevertheless, this platform offers benefits where FreshBooks is lacking.

For example, Wave includes double-entry accounting, an unlimited number of users, as well as billing and invoice reminders, all of which require either an additional cost or, at minimum, the $25 FreshBooks Plus plan. Moreover, Wave gives you the ability to extend your accounting software functionality with their payroll and payments paid add-ons.

Although Wave doesn’t offer some of the broader features that FreshBooks provides, like project and client management, this solution includes significant bookkeeping and accounting tools, especially for free software.

Xero

Finally, for a well-rounded FreshBooks competitor that is quickly growing to be a top QuickBooks alternative, you might look into Xero accounting.

Like FreshBooks, Xero is known for their user-friendly platform and wide-ranging functionality.

Although Xero offers their Early plan for $9 per month, this solution restricts you based on the number of invoices, quotes, bills, and bank transactions. Therefore, either the Xero Growing or Xero Established plan is going to be most comparable to the services FreshBooks offers.

This being said, for $30 and $60 per month, these plans may be slightly more expensive than FreshBooks’ two higher-level plans—and yet, Xero offers unlimited users, as well as advanced tools for inventory, paying bills, projects, purchase orders, and more.

Moreover, Xero includes a mobile app for on-the-go account access, as well as the opportunity to connect to over 700 third-party tools.

Therefore, if you want greater flexibility and features from your accounting software (at a fairly similar cost to FreshBooks) Xero may be an option to consider.

FreshBooks Review: The Bottom Line

We’ve reached the end of our FreshBooks review and now the final decision is up to you. Taking into consideration everything we’ve discussed with regards to FreshBooks pricing, plans, and features, only you can decide if this is the right accounting software for your business.

This being said, there’s no doubt that with the substantial capabilities and overall mobility and usability of FreshBooks, it’s a viable solution for a variety of small businesses. Along the same lines, however, if you need greater affordability and flexibility from your accounting software, it may be worth considering a FreshBooks alternative.

Nevertheless, with a free 30-day trial and no credit card required, you have the opportunity to try FreshBooks accounting software for yourself. By creating a FreshBooks account and exploring the platform firsthand, you’ll have a better sense if this solution can fulfill your business accounting needs.

Senior Staff Writer at Fundera

Randa Kriss

Randa Kriss is a senior staff writer at Fundera.

At Fundera, Randa specializes in reviewing small business products, software, and services. Randa has written hundreds of reviews across a wide swath of business topics including ecommerce, merchant services, accounting, credit cards, bank accounts, loan products, and payroll and human resources solutions. 

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