Bookkeeping for Newbies

15 Replies

Hello Everyone,

This question goes out to all investors big and small; to the big investors when you started and the small investors where your business is currently. 

I am only in the beginning stages of real estate investing with two current rentals, and I just heard about Freshbooks.com. I wanted to get some opinions on that bookkeeping service verses other bookkeeping services that may be better.

Please let me know.

Thanks,

Peter  

For what is worth.. I am new investor with one 4-plex to my name.  I use a property management company to handle the day-to-day operations and so I only use a simple spreadsheet to keep track of my revenue and expenses month  by month (with a year summary to give my accountant).

I can't remember where I found the spreadsheet template (i think i just googled it, but you could easily re-create something like this).

Hope it helps!

Jason

My CPA recommended Quicken Property Manager. Seems ok so far, but I'm just playing with it at the moment, I'm far from having tested all of its capabilities. But it was pretty affordable so I thought I'd mention. Good luck!

My business partner and I started out with Quicken because he used that for all his rental properties. We have 21 rental properties together. I converted us over to Quickbooks because my CPA recommended it. It seems that most accountants do and it makes things a lot easier. It's easy to generate P&L's and Balance Sheets, which are the docs you need to show anyone who wants to take a look at your books (Lenders, Investors, IRS, accountants). The conversion was painful and time consuming. I wish I would have started out with Quickbooks from the beginning.

The Power of QuickBooks. Things most don't know that QuickBooks can do.

What a shame that most people don't know the actual power of QUICKBOOKS. And yet, if you purchase QuickBooks Pro at Amazon.com, you can most likely purchase it for about $239.00 (Approx) and it's a tax write off.

Today I'm going to show you the things you didn't know QuickBooks can do.

Let's start by QuickBooks allowing YOU to enter in your rental properties, and have it show you all the things you want to know about that property. Let's take a look.

This is in the Fixed Asset Feature of QuickBooks. You can customize this form to show you what you want to see. I wanted to see:

  • My rental address
  • The date I purchased this property
  • What type of dwelling it is
  • The year it was built
  • How much I paid for it
  • How many square feet
  • What I sold it for when and if I sell it
  • When I received my Certificate of Acceptance
  • When I received my Certificate of Occupancy

What would you like to see on your form? Just fill out the form in QuickBooks and your wish is fulfilled.

Let's take a look at it the fixed asset feature even further. The above screen shot is just a Table of Contents for the actual data for this particular property.

When you setup your rental property in QuickBooks in the Fixed Asset Feature, this form will appear and you will fill it out.

You will fill in the name of the rental property, purchase date, cost, etc. Type of rental (asset) location and I like typing in the Notes window the land description, I'm always having to look it up it seems, so I wanted it handy.

The right side of the form is for purchasing a home. The left side is when selling it.

Based on the information entered on this form, I was able to create the first form that I showed you.

Let's take a look at something else I bet you didn't know QuickBooks could do. QuickBooks will show you via colorful graphs where you stand today financially. How much money is owed to you. Expenses, etc.

Let's take a look at another screen shot.

This will show you in colorful details all about your tenants. Who owes you what, if they are past due. Etc.

Let's take a look at some more.

QuickBooks even has a LEAD INFORMATION SHEET for potential customers!!!!

QuickBooks allows you to see all your properties at a glance and how much income they made for you, expenses you dished out and their bottom line.

And QuickBooks will allow you to view each property individually to see how much that property made you in income less expenses equaling your bottom line.

YOU CAN DESIGN YOUR OWN INVOICES.

I DESIGNED AN INVOICE CALLED TENANT BILLING. I designed it to tell me

  • the tenants move in date,
  • security deposit,
  • rental amount,
  • and lease type.
  • They are easy to designe, however, when you purchase my book you receive my Chart of Accounts, Items List, and Templates (like the one below) free with a proof of purchase of the book sent to me via e-mail.

HERE IS A SECURITY DEPOSIT RECEIPT TEMPLATE I DESIGNED. ONCE AGAIN the tenant and I (the landlord) am able to see at a glance the tenants Move in Date, Security Deposit, Rental Amount and Lease Type. You can even have the Lease Expiration date on here as well if you choose.

I like taking notes about my tenants and things that go on inside my business. So I designed a template called Notes. Just like the sticky notes you see. I type in my notes and print them out and stick them into the tenants physical files, or I just may not print them out until the tenant actually moves and I make their account inactive in QuickBooks. Whatever you choose to do with your notes is up to you.

Frankly, I could go on and on and on as to what QuickBooks can do for you. Some tell me, yea but ya have to customize it to do all this stuff. That's true , but not all the stuff. And if you can fill out a form, you can customize QuickBooks. It's not like you have to be an engineer and sit down with a pencil and paper and plan your design.

As I said above, to pay around $239.00 for a software program via Amazon, and have it be a tax write off to boot, for something this powerful, just doesn't get any better than this. 

Nancy Neville

Although I don't have any information to give on this topic I wanted to say thanks to @Peter Mckernan  for asking this question. I have been looking all around trying to figure out book keeping what's needed and what's not. I was always referred to products such as buildium, simplyfyem etc. I like the idea of quickbooks that @Nancy Neville   gave an example of it seems simple, easy to manipulate to fit your needs, also  with the other software you are charged per month for access. So to me it seems like quickbooks is good to start with to figure out what exactly you want just in case you outgrow quickbooks and want to move up to any of the other software. 

That is really good information Nancy Neville. Also I looked up on your website @nancy Neville , What are you selling ? is it a guide on how to use Quick book ? 

So if I am about to change over to use Quick book effectively, I should buy software from Amazon , then buy your guide to learn how to set it up. is that correct ? or 

@Nancy Neville  - Can you hold receipts in QB? What I'm looking to do is not have a bulging envelope with all my stupid receipts and take a picture or scan them in and associate it with the property the expense took place at. Would this work? Also, do you have an affiliate link where you get consideration for the purchase of QB? If so, please DM me and if I decide to go this route, you'll get a little something for helping me out. 

Hello Mike

You can scan whatever you want into QuickBooks.  But there is a catch.  It's in the clouds and you have to pay a fee. I forget how much it is. 

Neat Receipt is a nice handy little machine, but expensive.  So QuickBooks in the Clouds Attachment would be cheaper, but, if you buy Neat Receipt it's a one time thing.  So I guess it's more or less what you want to do.

I usually by QuickBooks through Amazon, and I get the Download Version.  I find Amazon sells it pretty cheap.  Especially if it's the download version.  You can always go back online to Amazon, to your account, and download it again any time you want to. 

The things I do on here I do it because I want to.  I enjoy helping others out.  However, when people go to my Webpage, that's my line of work, and therefore, you do have to spend money for my goodies.

But anything I post on here is free for the taking!  Thanks for offering though!

Nancy Neville

Hello Tommy:  I have written a step by step guide for Landlords on how to setup your properties correctly in QuickBooks. 

I have also written a book on how to be a landlord.  Even though the back of the book MLC Codes are for Michigan, the rest of the book is for anyone.

Plus I have lots of other information there.  You have to click on Topics.

Thanks for asking.

Nancy Neville

@Nancy Neville  

Thank you for the post! That was very instructional and it is very helpful! I am going to look into getting Quickbooks on Amazon. Thank you for spending the time and showing a demonstration on how to use the service as well! 

Thanks,

Peter 

Using Document Management feature in QuickBooks is free. You can scan and attach your documents - here is an article http://fasttracconsulting.com/2011/09/document-cen... and many others on how to use QuickBooks.

Gita Faust

@Peter Mckernan  for future reference, my experience with FreshBooks is that it's nice for invoicing, but a little clunky (in my opinion) for other things. I use it for my freelance web/design business, which it works great for, but I wouldn't use it for property management, given what other programs can handle.

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