Earning your bachelor’s degree in accounting is the first step to a life-long career in the field. According to leading labor market analytics firm EMSI, the median annual salary for a bookkeeper is $42,411. Accountants, on the other hand, earn a median annual salary of $73,570, which is a 73% increase compared to a bookkeeper. This increase can be primarily attributed to the education, training and strategic role of an accountant. A bookkeeper can be the business owner, an in-house employee, freelancer or professional from an online bookkeeping service like QuickBooks Live or Bench.
- On the other hand, accounting focuses on the detailed study of business operations.
- It can be difficult to gauge the appropriate time to hire an accounting professional or bookkeeper ― or to determine if you need one at all.
- There are also other credentials accountants can receive such as CFA and CIA that allow accountants to provide a specific set of services to businesses.
- Bookkeepers do not have the training or certifications to work as accountants, and accountants do not usually have the experience or software knowledge to function as bookkeepers.
- Bookkeepers compute, classify, and record numerical data to keep financial records complete.
The bookkeeper job description entails maintaining the general ledger and accounts, recording transactions, posting debits and credits, running payroll and creating invoices. While there are certain similarities and overlaps between the two, there are distinctions that set these two roles apart. Bookkeepers don’t necessarily need higher education in order to work in their field while accountants can be more specialized in their training. Because bookkeepers tend to work for smaller companies, they may not be paid as much as accountants.
Bookkeeper vs staff accountant salary
Both of these aspects of your business are crucial for financial management and decision-making. Today, we’ll go over the differences between bookkeeping and accounting so that you can figure out how to allocate resources effectively. However, there are also several advantages of hiring a certified accounting professional in addition to or over a bookkeeper. These advantages include the benefit of a comprehensive financial analysis, a higher level of expertise, and legal assistance.
- Bodies like the American Institute of Certified Public Accountants (AICPA) or the Association of Chartered Certified Accountants (ACCA) govern accounting and bookkeeping professionals.
- ”, we can say that this individual is the backbone of the business because, without one, all the upper-level workers will have no actual facts to base their decisions on.
- To earn this title, bookkeepers must demonstrate their expertise in double-entry bookkeeping, knowledge of relevant software, and understanding of relevant business laws.
- It’s a way to show your skill set to potential employers and others in your professional network.
- They prepare the regular economic transactions in a continuous and easy-to-understand way.
The average annual salary for Bookkeepers is $45,140, compared to $83,980 for Accountants. Bookkeepers are not typically highly paid, since their mean salary is 23% below the average salary in the United States ($58,260). Furthermore, they make about a half less than the mean earnings of the Professional, Scientific, and Technical Services industry ($91,150). If you enjoy organization and numbers and have experience with bookkeeping, starting your own business offering this service might be a smart career choice. Since bookkeeping is a more straightforward process than accounting, it is something that many people can (and do) opt to take care of themselves.
Accounting Assistant vs. Bookkeeper: What Are the Differences?
They also need to have attention to detail to ensure that all the numbers in the financial records are correct. Accounting and bookkeeping sound similar in some aspects despite differences. We need accounting fundamentals in both the profession and both accountants and bookkeepers assist the business owner for the growth. Owing to these similarities, some small or average businesses endeavor to hire bookkeepers instead of accountants to handle the accounting operations. Bookkeepers generally need strong attention to detail, data entry skills, and proficiency in bookkeeping software.
Bookkeepers and accountants can learn specialized skills as they progress through their degree programs and gain on-the-job experience. That being said, if this is your chosen field, it is crucial to make one important decision at the very start. Accounting careers may offer flexibility and opportunities across a wide range of sectors. Accountants can specialize in government guide to recurring invoices or nonprofit accounting, consulting or freelance, or work in areas like forensic accounting, auditing or education. All these career paths often start with the same type of education, with many accountants pursuing a Bachelor of Science in Accounting degree. A careful evaluation of your business’s requirements, intricacies, and financial objectives is needed.
Bookkeeper average salary
In most cases, private companies do not pay more than the Big Four for young accountants with little experience. Public accounting generally pays the most to a candidate right out of school. In particular, the big four firms of Ernst & Young, Deloitte, KPMG, and PricewaterhouseCoopers offer larger salaries than mid-size and small firms. Depending on the city, you can expect to earn between $40,000 and $60,000 your first year as a Big Four accountant. While the companies do not publish salaries on their websites, the benefits can be a large draw. For example, KPMG offers employees up to 25 days of paid vacation time, telecommuting opportunities, and a robust health insurance package.
In September 2022, Payscale placed the national U.S. average rate for bookkeepers at $18.46 per hour. Bookkeepers should research local average rates to ensure they price their services competitively. However, keep in mind that those higher living costs may cancel out the financial benefits of increased bookkeeping salaries. In addition, you must be a member of the Association of Certified Fraud Examiners. In most cases, employers want to hire someone with a bachelor’s degree, and a master’s degree may help boost your earnings.
Best Accounting Software for Small Businesses
If you are proficient and comfortable using mathematics and computing figures, plus punctual, organized, and detail-oriented, it is not hard to learn how to be a bookkeeper. Of course, a background in accounting practices will help you ride out a learning curve as a new bookkeeper. As an accountant, you may have to crunch numbers, but those are not the only skills needed.
Bookkeepers who are interested in switching jobs but do not have a college degree might consider becoming an EA after a stint with the IRS. This job doesn’t require a college degree, only five years of tax experience with the IRS. If you are already a CPA, you can act as an enrolled agent without passing the exam. Mid-size and small public accounting firms pay, on average, about 10% less than these firms. If you choose to work for a company internally instead of in public accounting, the starting salary range is very broad.
Is AI replacing the roles of accountants and bookkeepers?
Additionally, Staff Accountant has a higher average salary of $54,216, compared to Bookkeeper pays an average of $40,337 annually. This fact makes your search for a bookkeeper quite hard to narrow down, but you can start by asking your colleagues for recommendations and browsing on websites like LinkedIn. A lot of U.S. bookkeepers get the American Institute of Professional Bookkeepers certification. It proves that the bookkeeper has signed the AIPB’s Code of Ethics and has successfully fulfilled its certification standards.
Bookkeepers and accountants generally need different degrees and training to begin their careers. Though they both work with financial statements, their daily duties are distinct, and they rely on different software, tools and processes. Bookkeepers and accountants are subject to various regulatory compliance requirements depending on their location, the nature of work, and the industries they serve. Non-compliance with these regulations may result in penalties, legal consequences, or damage to a professional’s reputation. Here are some key compliance areas that bookkeepers and accountants should stay informed about. The CPB license ensures that the holder is equipped with a high level of proficiency in bookkeeping practices, managing payroll, QuickBooks, accounting, and tax fundamentals.