Wave Accounting Review
As a freelancer or independent contractor, you’re making money and spending money so consider yourself a small business owner. This means you need accounting and bookkeeping software to track everything properly.
However, since you run things on a lean budget, saving money is your top priority! Shelling out funds for a subscription to Quicken or QuickBooks really hurts when you operate on such a small scale.
Before you buy anything, check out this updated review on Wave Accounting - an affordable accounting software that’s been around since 2010 and who's focus is on supporting small business owners like you.
What is Wave Accounting?
Wave accounting was founded in July 2009 by James Lochrie and Kirk Simpson and is headquartered in Toronto, Canada. It was officially launched in 2010 with 8 employees and caters to small and medium businesses by providing free online accounting and invoicing software and affordable credit card and payroll processing services.
Also known as Wave Apps, the platform also provides tax advice services and bookkeeping support.
On June 11, 2019, Wave Apps was acquired by H&R Block. Since then Wave has updated its logo and features but has kept their select freemium services platform.
In a nutshell, Wave Apps offers the following services:
- Track income & expenses
- Accept payments online
- Perform simple payroll services
- Track receipts
- Create in-depth accounting and bookkeeping reports
Who is Wave Accounting For?
Wave is perfect for small business owners, solopreneurs, freelancers, independent contractors, and medium business owners looking for free/affordable cloud accounting and bookkeeping software that can track payments, create invoices, accept payments, track receipts, and much more.
How Much Does Wave Accounting Cost?
Wave Accounting is free to sign up and some of the apps are free to use, other apps are pay-as-you-go, and some are pay-by-month. Here is a quick breakdown on how each one works:
Free Wave Apps:
- All online accounting software
- Invoicing software
- Receipt scanning
Pay-Per-Use Wave Apps:
- Credit card processing: 2.9% + $0.30 per transaction
- Bank payments (ACH processing): 1% per transaction
Monthly Wave App Payments:
- Payroll in tax service states: $35 + $4 per employe + $4 per independent contractor paid
- Payroll in all other 41 states: $20 + $4 per employee + $4 per independent contractor paid
How Do You Sign Up?
- Sign up with your email and a secure password.
- Add your name, business name, and what your business does.
- Choose a starting point. Send invoices, manage accounting, or run a payroll. It’s okay if you don’t know where you want to start too.
- Let Wave know where you are in your business: Just trying it out, full time, part time, or launching it soon.
Note: Wave is available in different countries. You have the option to change currency on the sign up page.
Wave Accounting Features
Once you sign up for Wave Accounting and get access to your Dashboard, it can get overwhelming.
You’ll get access to a robust set of accounting and bookkeeping features so I’m going to start at the top and work my way down in the order you’ll see them on your dashboard.
First Things First...
Here's What You Need to Do in Your Wave Account
Once you’re ready to use Wave Accounting to manage your business, the first things you need to set up are :
- Link business bank accounts (under the Banking section) - this makes tracking profit and loss, and cash flow easier.
- Add products & services for sales (under the Sales section) - list the things you sell to make creating estimates and invoices faster.
- Add current clients/customers (under the Sales section) - this makes creating invoices quicker.
- Add products & services for purchases (under the Purchases section) - list out the things you purchase to run your business. This makes filling out bills to vendors and contractors easier.
- You’ll see that the last 3 items tie into working and managing your account in the Wave platform. It’s also one of the first things you’ll be prompted to do from the dashboard when you sign up.
On the dashboard you get access to current cash flow and profit and losses.
For up-to-date information, have all business bank accounts automatically linked so transactions can be added automatically.
In the Sales section you can create and manage the following accounting/bookkeeping services:
Estimates - Create estimates for customers/clients which can later be turned into invoices.
Invoices - Create free and simple invoices. You can insert your own logo and business color. There are 3 design templates to choose from.
Recurring Invoices - Wave lets you create recurring invoices that collect recurring customer payments automatically.
Checkouts - Accept payments directly from your website without coding.
Payments - This is where you set up your Wave account to accept credit card or bank transfer payments through invoicing and/or checkouts.
Customer Statements - This is a welcome addition to Wave’s features (Wave was lacking this back when I reviewed them in 2017). Customer statements let you keep in touch with customers/clients to remind them of outstanding invoices and create statements so you can share details of account activity for their records.
Customer Databases - This is your database of all customer and client information. Invoices and estimates pull information from here.
Products & Services (Sales) - This is the database of all the products and services you sell along with pricing data. This section is not to be confused with the products and services in your purchases section.
The Purchases section is where everything related to, you guessed it, purchasing will be.
Bills - This falls under your expense category and where you can add bills manually.
Receipts - Keep track of receipts in Wave by uploading them via mobile app on Android or iOS. Or email them to firstname.lastname@example.org.
Vendors - This is where you keep track of vendors or contractors. Upload them from Google contacts, a CSV file, or add them manually.
Products & Services (Purchases) - Not to be confused with products & services in the sales section. This is a database of all the products and services you buy from vendors and other contractors. These are items that will show up on bills.
Transactions - This is where you can manage all bank transactions. There are 3 ways to do it:
- Connect your bank account automatically (US and Canadian banks only)
- Upload bank statements (using Wave Connect add-on)
- Add your transactions manually.
Reconciliation - Wave helps you reconcile accounts by walking you through each transaction helping you look for missing or duplicate transactions. That way you can make sure your numbers are correct at the end of the month or year.
Chart of Accounts - This gives you a broad view of all the different types of amounts within your business (income, expenses, liabilities, assets, etc). The Chart of Accounts shows the inflow/outflow of money on one page.
Hire a Bookkeeper - You can hire a bookkeeper, tax professional, or accounting coach right in the app if you need.
Connected Accounts - You can use this feature to connect to a Canadian or US bank only to make bookkeeping and accounting easier.
If you're using a bank outside of Canada or US, you can use Wave Connect, which lets you import/export transactions using and add-on.
Payouts - Set yourself up to get paid online for regular invoices, recurring invoices, and online checkouts. Get paid by ACH bank transfers, PayPal transfers, or credit card.
Insurance - Only available in the US, Wave has partnered with Next Insurance to offer small businesses insurance. You can sign up right from your dashboard. Learn more here.
Run Payroll - This dashboard lets you run your entire payroll from one place. You can schedule, edit, and approve payroll for both employees and independent contractors. The dashboard shows start/end periods, and direct deposit dates, you can also generate W-2s, and view total costs from the dashboard.
Employees - Here is where you can add all your employees and their pertinent information (address, tax information, etc.).
Timesheets - Hourly and salaried employees hours can be tracked here. You can also include overtime, vacation, or other types of hours like sick or holiday time too.
Taxes - Set up tax payments for payroll.
Direct Deposit - Set up direct deposit for payroll.
Note: Your Payroll dashboard needs to be set up before you can access the employees, timesheets, taxes, and direct deposit dashboards.
The reports dashboard is where you’ll get the most value. After linking your accounts and managing your business through the Wave platform for a few months, you can see how your business is doing by running a few of these reports.
Get the big picture - Here is where you can run Profit & Loss, Balance Sheet, and Cash Flow reports.
Stay on top of taxes - This section will let you concentrate on reports that have to deal with taxes. Get a Sales Tax, and a Payroll & Wage Tax report.
Focus on customers - If you want to see how your business is doing in relation to sales, these two reports will let you focus on Income by Customer and Aged Receivables.
Focus on vendors - Conversely if you want to see how it’s doing in relation to spending, run these reports: Purchases by Vendor and Aged Payables.
Dig deeper - Lastly, you can run customized reports that detail transactions over the life of your business: Account Balances, Trial Balances, and General Ledger.
Right from your dashboard, you can sign up to get help from a team of professional Wave advisors. Whether it’s bookkeeping, tax help, or accounting, Wave can help.
Wave has a robust integration platform that you can use to customize your workflow.
From the add-on Wave Connect that allows you to import/export financial reports using Google Sheets, to ecommerce apps like Shopify and scheduling apps like Calendly, you can connect workflow apps directly to Wave to make your business run smoother.
Here’s a list of just a few of Waves integrations that you can connect to customize your workflow with Wave.
- Google Sheets
- Zapier and its more than 1000 popular apps!
- And more…
If you want to download your information for your personal records or tax information, Wave lets you do that from your settings tab. You can export information from your accounts, general ledger, journal entries, and transactions.
- Free to sign up and free basic accounting and bookkeeping features, perfect for the micro business owner/freelancer
- Affordable payment processing comparable to, if not cheaper than QuickBooks Self-Employed
- Robust account tracking and reporting, free invoicing and estimates, and all the bookkeeping features a small business freelancer could want for free
- Create multiple accounts for business and personal use
- Multiple workflow integrations
- The online app can be glitchy
- Connected banking only available for US and Canadian banks
- Wave still has separate mobile apps, one for invoicing and one for receipts (Android & iOS)
- Online help database is not obvious from the dashboard. The help button takes you to a Community section or Support section, neither of which takes you directly to the Help Center page, which is much easier to navigate than using the pop-up keyword helper.
- No time tracking feature
- Cannot add users
- Immediate customer service is a bit lacking
Alternatives to Wave Accounting
There are other apps that can help you with accounting and bookkeeping but I found that these are not as robust and free/affordable as Wave.
I really like the fact that even after being purchased by H&R Block, Wave has kept its affordable/free platform and dedication to small business owners (so far…).
I don’t personally use Wave but it's because I got stuck paying for a platform way back before I found Wave when I first started my business. Now all my information is with the other platform. I intend on creating a review on that soon.
But if you’re just starting out and looking for an app to help you track the books, Wave is definitely worth a look.
Just to keep your options open, here are some similar alternatives to Wave accounting for small business freelancers:
If you’re just starting out as a freelancer, or looking for an affordable alternative to your current accounting platform, I suggest you give Wave Accounting a try.
What I like about it is that Wave is the most affordable, most robust accounting software that has been around a while. It focuses on small to medium businesses and has kept its pricing platform in the free/affordable range since they began. This, plus the fact that you can use the Wave platform for personal accounting and bookkeeping use makes it worth the attention.
Your turn. Have you used Wave Accounting? What do you think about it? Let me know in the comments.
- Editor Rating
- Rated 4 stars
- Wave Accounting App
- Reviewed by:
- Published on:
- Last modified:
- PricingEditor: 90%
- Ease of useEditor: 70%
- SupportEditor: 50%