Xero vs Wave: Which Software is Best for Your Small Business?

The easiest way to answer that question is to start out with your preferred investment approach. A proposed ASU would update the guidance on accounting for software, specifically when it comes to developing software for internal use. In this way, Wave elements of financial statements not only stands out against Xero, but many other accounting solutions on the market as well.

You can use the accounting tool to handle income and expenses, generate financial statements, and connect with your bank cards and accounts. It also provides you with in-depth reports on cash flow and profit and loss, as well as of overdue bills and invoices. You can use it for a couple of businesses from the same Wave account. To track expenses outside of reconciled bank transactions within Xero, you’ll need to choose the $60/month plan with access to the Expenses feature.

While not technically a feature, it’s important to note a few things about the customer service and support of Xero and Wave. While both offer reporting, Xero has a more extensive reporting feature. You can create, view, and depreciation methods print 55 different reports covering everything from sales to cash flow and budget. Xero has a budgeting feature that allows you to create a three-month, six-month, 12-month, or 24-month budget.

The pricing of these two accounting solutions differs largely based on the way the platforms are structured. With three plans to choose from, Xero prices their service on a monthly, subscription basis. Wave, on the other hand, is a free accounting software—one of the only truly free options on the market. Wave recently added a paid plan, Wave Pro, which costs $16 per month if billed monthly or $170 per year if billed annually.

You’re a freelancer or small business owner

Both Xero and Wave are strong accounting options, although each better serves a different type of user. It is worth mentioning that these reports do cover the financial basics, but you won’t find advanced reporting here. Xero also offers 55+ reports, which far exceeds the 12 offered by Wave.

1. The only things you’ll need to budget for are payroll functionality and access to expert services.
2. QuickBooks has the most robust software and professional infrastructure around it.
3. The feature we like best is its bank reconciliation module—except for the fact that users can’t enter ending balances of checking accounts to start reconciling.
4. By providing feedback on how we can improve, you can earn gift cards and get early access to new features.
5. Wave recently added a paid plan, Wave Pro, which costs $16 per month if billed monthly or $170 per year if billed annually.

Best POS Systems For Small Business In 2024

Bonsai also provides you what is bank leverage with freelance invoice template, retainer agreement, and online signature maker. The scalability of accounting software has also played a pivotal role in its popularity. They can experience dramatic fluctuations in transactions, clients, and revenue streams. Accounting software adapts to these changes seamlessly, accommodating the evolving needs of the business. This scalability ensures that the software remains a valuable asset as the business changes. Wave Payroll also gives you the ability to grant employees access to view their pay stubs and W-2s, as well as contact and banking information.

Xero’s reporting functionality, while more limited, is visually appealing and easier to use. You can view P&Ls, balance sheets, inventory tracking, and so on. While Xero doesn’t charge an invoicing fee, their features are the most basic. If you need to send many invoices or make a lot of customizations, you may find it challenging to use. Learn how to choose the best options to enhance your financial planning, client management, and overall efficiency.

Integrations: FreshBooks vs. Xero

Users can sync their favorite small-business payroll software with Wave via Zapier, but doing so isn’t as simple or streamlined as relying on a built-in integration pathway. Our unbiased reviews and content are supported in part by affiliate partnerships, and we adhere to strict guidelines to preserve editorial integrity. The editorial content on this page is not provided by any of the companies mentioned and has not been reviewed, approved or otherwise endorsed by any of these entities. Let us know how well the content on this page solved your problem today. All feedback, positive or negative, helps us to improve the way we help small businesses. Run payroll on any device with taxes, compliance & reporting built-in.

Features: FreshBooks vs. Xero

In addition, Wave includes unlimited invoices, bills, and transactions for free—all of which are limited within the Early, $11 per month, Xero plan. Wave offers a free plan (Starter) for a single user and a paid option (Pro) for unlimited users. Both plans include accounting and invoicing features, but Pro has additional inclusions, like unlimited user access, bank feed connections, receipt capture, and discounted credit card processing fees.