Choosing the right accounting software is a crucial decision for small business owners, freelancers, and entrepreneurs. FreshBooks and Wave are two popular options that cater to different types of users, each offering distinct features and pricing structures. In this blog, we’ll compare FreshBooks and Wave to help you determine which software is the best fit for your business.
Overview: FreshBooks and Wave
FreshBooks is designed primarily for professional service providers such as attorneys, architects, designers, and other similar professions. It’s known for its scalability, offering four different pricing plans that can grow with your business. FreshBooks provides a robust set of features tailored to businesses that require detailed invoicing, expense tracking, and client management.
Wave, on the other hand, is geared towards freelancers, micro-businesses, and sole proprietors. Its standout feature is that its core accounting tools are completely free, making it an attractive option for businesses with tight budgets. Wave offers essential accounting features, making it a cost-effective solution for those who need basic but reliable financial management tools.
Pricing
FreshBooks offers four pricing plans, providing flexibility as your business grows:
- Lite: $7.60 per month – Best for freelancers and businesses with basic needs.
- Plus: $13.60 per month – Suitable for small businesses that require more advanced features.
- Premium: $24 per month – Ideal for growing businesses with larger client bases.
Wave is known for its free accounting software, which includes invoicing, receipt scanning, and expense tracking. While the core features are free, Wave does offer a Pro plan at $20 per month that includes additional features like priority support and advanced financial management tools.
If you’re looking for a budget-friendly option with essential features, Wave’s free plan is unbeatable. However, if you need more advanced features and scalability, FreshBooks offers a range of plans to fit your growing business needs.
User Interface
Both FreshBooks and Wave are praised for their clean and intuitive user interfaces.
FreshBooks has a user-friendly design that’s particularly appealing to users who are not accounting experts. The dashboard is straightforward, providing quick access to key features like invoicing, expenses, and reports. FreshBooks also offers a mobile app with a similarly clean interface, making it easy to manage your business on the go.
Wave also boasts a simple, intuitive design that’s easy to navigate, even for users with little accounting experience. The interface is clean, with all the necessary tools easily accessible from the main dashboard. Like FreshBooks, Wave also offers a mobile app that allows users to manage their finances from anywhere.
Both FreshBooks and Wave offer user-friendly interfaces that are easy to navigate, making either a good choice for those who prioritize ease of use.
Invoicing
Invoicing is a critical feature for any accounting software, and both FreshBooks and Wave excel in this area.
FreshBooks offers highly customizable invoicing options, including the ability to create recurring invoices, set automatic payment reminders, and include late fees. FreshBooks also supports multi-currency invoicing, which is ideal for businesses with international clients. Additionally, you can track when clients view invoices, adding an extra layer of transparency.
Wave also provides a robust invoicing tool that allows you to create and send professional-looking invoices quickly. While Wave’s invoicing features are not as advanced as FreshBooks’, they are more than sufficient for freelancers and small businesses. Wave supports recurring invoices and offers basic customization options, making it easy to manage billing.
FreshBooks offers more advanced invoicing features, making it the better choice for businesses with complex billing needs. However, Wave’s invoicing tools are perfectly adequate for freelancers and small businesses.
Expense Tracking
Keeping track of expenses is essential for maintaining healthy cash flow, and both FreshBooks and Wave offer solid expense-tracking tools.
FreshBooks allows users to mark expenses as billable and charge them back to clients, which is a valuable feature for service-based businesses. FreshBooks also automatically imports transactions from connected bank accounts and supports inventory management, helping you keep track of both your finances and your stock.
Wave also connects to your financial institutions to automatically import transactions. However, Wave’s expense tracking features are more basic than those of FreshBooks. While it covers the essentials, such as categorizing expenses and attaching receipts, it lacks advanced features like billable expenses and inventory management.
FreshBooks offers more comprehensive expense tracking features, making it a better option for businesses that require detailed financial management. Wave is a good choice for those who need basic expense tracking without the bells and whistles.
Payment Processing
Accepting payments online is a crucial feature for many businesses, and both FreshBooks and Wave offer payment processing capabilities.
FreshBooks allows you to accept credit cards and ACH transfers directly through the platform. You can also set up recurring payments for clients using ongoing services. FreshBooks charges a fee for payment processing, but it provides a seamless experience for both the business and the client.
Wave also supports online payment acceptance, including credit cards and ACH transfers. Like FreshBooks, Wave charges fees for payment processing services. The process is straightforward, allowing clients to pay directly through the invoices you send.
Both FreshBooks and Wave offer similar payment processing features, making them both viable options depending on your needs.
Payroll
Managing payroll is a complex task, and only FreshBooks offers robust payroll integration.
FreshBooks integrates with Gusto, a leading payroll service provider, to handle payroll processing. This integration allows you to manage employee payments, tax filings, and benefits directly from your accounting software.
Wave offers limited payroll services, with full payroll tax services only available in a few states. For businesses outside these states, payroll processing may be more manual and less integrated.
If payroll is a significant part of your business, FreshBooks is the better choice due to its integration with Gusto. Wave’s payroll capabilities are more limited and may not meet the needs of growing businesses.
Integration
Integration with other apps is essential for streamlining your business operations, and here’s how FreshBooks and Wave compare:
FreshBooks connects with over 200 apps directly and more than 1,500 apps through Zapier. This includes popular tools like Slack, Trello, Shopify, and HubSpot, allowing you to customize your workflow and enhance your business processes.
Wave offers fewer direct integrations but still connects with a couple of essential apps directly and over 1,000 apps through Zapier. While this may be sufficient for small businesses, those with more complex needs might find FreshBooks’ extensive integrations more beneficial.
FreshBooks offers more extensive integration options, making it the better choice for businesses that rely on multiple apps and tools. Wave’s integrations are more limited but still sufficient for basic needs.
Reporting
Reporting capabilities are essential for understanding your business’s financial health, and both FreshBooks and Wave offer useful reporting tools.
FreshBooks provides 14 standard reports, including profit and loss, expenses, and tax summaries. While these reports offer valuable insights, customization options are limited, which may be a drawback for businesses needing more tailored reporting.
Wave includes 12 standard reports, covering essentials like income statements, balance sheets, and cash flow. Like FreshBooks, Wave’s reports have limited customization capabilities, but they are adequate for most small businesses and freelancers.
Both FreshBooks and Wave offer standard reporting features, with FreshBooks having a slight edge in the number of reports available. However, if you require highly customized reports, you may need to explore other software options.
Conclusion: Which Accounting Software Is Right for You?
Choosing between FreshBooks and Wave ultimately depends on your business’s specific needs and budget.
Choose FreshBooks if:
- You need advanced invoicing, expense tracking, and payroll features.
- You’re looking for software that can scale with your growing business.
- You require extensive app integrations to streamline your workflow.
Choose Wave if:
- You’re a freelancer, micro-business, or sole proprietor with basic accounting needs.
- You’re looking for a cost-effective solution with a free plan.
- You need simple, user-friendly software to manage your finances without needing advanced features.
Both FreshBooks and Wave are excellent accounting software options, but the right choice for you will depend on your business’s size, complexity, and budget. You can select the software that best supports your financial management needs by considering the features that matter most to your operations.
