Why accounting is hostile + wildly inaccessible

I have a personal-trainer-turned-friend who is smart, fierce, and driven and I’ve come to adore her. She lost over 100lbs on her own and down 20%+ body fat through her own regiment of discipline, whole foods, and extremely sassy fitness + life tips. I was first drawn in by her “Before” photos as they felt like a similar body type to mine, paired with “After’s” that were completely fire 🔥 (what better proof in the pudding than a player turned coach?). As testament to that mentality, her “Current’s” continue to march towards new goals she sets out towards – almost like a real life case study of what you can accomplish regardless of where you are (as in, why settle for 21% body fat when you can be 18%?). After a few DM’s and a first session trial I knew this was a fit. I was also curious about trying a female trainer as I’d only had male one’s in the past, and while I had come to adore + befriend them too, I will shout from the rooftops that I really enjoy having a female coach more. It’s been motivating and comfortable on a level I hadn’t known (and I do NOT mean physically - THAT part is harder than any of the dudes who trained me).

For anyone working out correctly, you are familiar with bringing a slog of emotional release to this physical activity, and having navigated some soul-crushing type of things personally – I can’t say enough for someone who can wax therapeutic philosophy while telling you to slow down your already excruciatingly slow pilates inspired strength training moves. The ability to not lose count of reps while gently offering helpful reminders like “giving the benefit of the doubt never benefits YOU” is next-level and I love it.

She’s also led the fitness transformation of one of the best pop stars of our time that both Zizi and I love bopping along to – so suffice it to say I’m proud of her for growing her fitness business, hustling as an entrepreneur, and practicing what she preaches everywhere she goes and whoever she’s with.

One thing, however, that doesn’t come naturally to her is…

Accounting.

Bank reconciliations.

Financials.

Of course. The bane of every entrepreneur’s existence. If you’ve experienced this, you’re nodding your head in woeful understanding. If you haven’t personally, you know someone who has. But as a client turned self-appointed big sister who dabbles in finance every day for 5 entities concurrently, I excitedly offered to do a crash course as a birthday present (delivered via present-ation, obviously).

It can’t be that difficult, right?

Wrong. So so so wrong.

Let me clarify for a moment: for a seasoned finance person with [omg, this feels like a lot] 18+ years now under my belt, it is not actually difficult as such. But SO INCREDIBLY ANNOYING. ARDUOUS. COUNTER-INTUITIVE. PAINFUL.

I could not believe the head-scratching trials and tribulations I encountered when I decided to make a dummy set of company financials. And I studied this shit in college1.

For fun on a Tuesday night, I decided to open a Freshbooks account (what the cool kids are using these days? It’s basically an uncomfortably hot version of Quickbooks Online), and link up a couple checking / saving / credit card accounts in order to give myself a deadline of 1 hour to get a couple months reconciled and in a cute little P&L + Balance Sheet format. I was genuinely confident about this (not shocking if you know me, but still).

Over 2 hours later… I still hadn’t completed reconciling even 1 account, had a bunch of remaining un-matched transactions, an un-balanced bank reconciliation, and a bunch of red highlighted errored out “invoices” that were supposed to be reimbursement requests from friends for charges I covered during our Europe trip. Even with ChatGPT at my side (and the benefit of being able to ask intelligent questions) it was so cumbersome that if I hadn’t known from two decades of exposure what the probable next thing to test was, I would have long given up.

Couple takeaways that I want to explore:

1. Every entrepreneur really should have a financial fairy-godmother (not a rich one I mean, like one that helps guide with accounting principles and getting your books right because HOW

2. Accounting really is inaccessible for the every day start-up business person. WHYYY must it feel so antiquated?!

And don’t get me wrong – outsourcing all of this was not off the table, and was considered. But I will say that finding the right fit to outsource to is also very difficult, especially if you don’t know what to ask or look for.

Besides the obvious things like considering what you can afford, you really have to understand what they are offering (which is usually explained in fancy business jargon or now, AI slop with lots of buzz words intended to confuse but hopefully impress) and then you have to interview them because you are literally hiring them and trusting them with your most vulnerable information. Ugh.

I’d taken for granted how painful this whole process is.

And honestly, I don’t have a quick-fix solution (sorry, I’m not selling anything 😂). Just know that if you’re reading this and at some point have banged your head against a computer keyboard regarding accounting and/or finances, I get it + I offer you a hug from the internet. You’re not an idiot, accounting just sucks. This comes naturally to NO ONE.

Or said differently: a mentor, or trusted advisor, or a friend that knows something about this stuff, or a family member who you actually look forward to getting advice from, or friends, friends-of-friends, anything, anyone who might know a thing or two about accounting. Don’t do this alone. Just, don’t.

And as incredible as YouTube is, I assert that I don’t think this is a job for rabbit-holing on YouTube, either. I had trouble finding one decent YouTube explanation on the importance / function of Bank Reconciliations that didn’t absolutely bore me to tears or included 90% of information that doesn’t matter. It is as though every explainer video requires a minimum quota of irrelevant boring jargon that’s just not important. To this end, accounting textbooks are also awful. Again, I don’t have an immediate fix here (still not selling anything!) but my point here is: please don’t assume you should do this by yourself as a business owner. You should absolutely learn how to create Facebook ads by yourself. Or set up a Shopify storefront. Do those by yourself. Don’t do accounting by yourself2.

I suppose it’s time to specify that accounting itself isn’t inaccessible, but the design feels like it is, and that’s because we use the same exact system today for accounting as we did 500 years ago. Luca Pacioli is credited with coming up with double-entry accounting in 1494, to help people count grain and goats and whatever else.

There aren’t a lot of things that have been unchanged for that long (perhaps just the calendar that all of civilization uses with its cute arbitrary lengths of weeks + various months and a random leap year hack because planets turn?).

In any case, this accounting system was capable of supporting the expansion of Italian merchants long ago into bigger networks of trade, credit, and more business partners, so it stuck… and is largely unchanged since then, which is so wild to me.

While we did not have “Freshbooks” then (let alone electricity), Freshbooks and every other accounting system on the planet uses the same logic system today. I’m willing to bet that the accountants in Mesopotamia who were ahead of their time might ALSO be pissed at the Freshbooks UX. If anyone has “at the intersection of modern design philosophy, UX failures, and accounting” listed as interests on their LinkedIn I would enjoy discussing this ad nauseum with you. But I digress.

I’m not here to change accounting or offer a brilliant new method… double-entry accounting really does work. But I do find the following re-frames helpful to consider when heading into this arena:

• Knowing the root definition of debit and credit helps + also is a fun fact for parties if you really want to win friends and influence people. Debit originally meant “he owes.” Credit meant “he trusts.” Obviously these roots are gone but the weirdness stays. Try to leave the concept of “more money” or “less money” at the proverbial door when you enter the accounting world. As in, there is never “more” money or “less” money, it only changes hands (or accounts). So try to look at where the money is flowing from and to – not just “in” or “out” – and a lot of the nuance of double-entry will crystallize.

• As business people (or regular people who manage money for ourselves) - we tend to think of money in piles. How much cash do I have? How much do I owe on my credit card? What pile of cash will I have after I pay what I need to? etc. Accounting, on the other hand, thinks in flows. Which pile is increasing and where did it come from? Which pile is decreasing and where did it go to? For every move, there is a counter move (hence, the “double-entry” of it all). In a flow, there is a give and a take (a debit and a credit). It’s not as much math as it is a mirrored structure (with the intention of transparency, as showing both sides makes it harder to hide stuff + commit fraud).

  We can try to view money in accounting like how we view energy IRL, for example. Compare the flow of money in debits and credits like energy in relationships: in offering emotional labor to a loved one, we “credit” connection while “debiting” our own bandwidth. You get it.

• Getting a little deeper here, but the backbone of Accounting boils down to a “Chart of Accounts”. Do find a decent YouTube explaining what this is before you get started. I suppose the Chart of Accounts is the pantry of Accounting’s kitchen. You wouldn’t try to cook a recipe without knowing what a pantry is (let alone what ingredients are in it), so learn that first. The video I linked is a little eye-roll but it’ll do. Kudos to the guy who made it for best SEO on Google as well as best GEO in ChatGPT for “chart of accounts explanation that is fast and not boring”.

Speaking of boring though, I am about to get very specific on a technical level below, so I bid you farewell at this stage if you’ve gotten this far, unless you go super hard for Freshbooks and need reminders on very basic things that Freshbooks did NOT make obvious. ❤️

Skip this part if you aren’t actually in Freshbooks and clicking around, because this is going to be a bit technical although important. I know this because of the amount of “ohhhhh’s” my trainer exclaimed while walking through the first setups – these are not intuitive, Freshbooks (and QBO as well) will not explain this to you, so I’m jotting them down here.

• Linking a bank account:

  • When linking a bank account or credit card or whatever, your opening balance is NOT a random beginning date you want your books to start with. Let’s say you want to get your books to start from January 1, 2025. Even if that’s your dream date, DO NOT automatically put this date as your opening balance when you link an account. Instead: put the date your STATEMENT says on it, for THAT SPECIFIC ACCOUNT, and put THAT OPENING BALANCE as your amount. I am YELLING because this is so painful not to know, and these accounting systems will not give you a tip on this.

    • You may not have noticed this before, but your checking or savings statements will have different cycle dates than your credit card, for example. If you opened your credit card on the 24th of a month, it will probably forever be the 24th. In this example, find the statement that starts with December 24th, use that opening balance, and use that date - since it’s the closest date before when you want your books to start, January 1 2025.

• Matching transactions:

  • Payments to credit card: A payment from your checking to pay off your credit card is NOT AN EXPENSE. (Your expenses were from the credit card account itself, like when you needed gas or coffee or a massage after trying to learn accounting). Again, paying it off is NOT AN EXPENSE even though it looks like it because its “cash out”. Mark this as a TRANSFER instead.

    • Select from the left side of the transactions matching view, and hit “Mark as” —> “Transfer”. Again I YELL because I CARE.

  • Incoming money: like Venmo’s or Zelles or ACH’s (like what you charge clients or what your Shopify store is selling). You WON’T be able to match these transactions UNTIL an invoice is set up AND a payment has been posted to it. Incredibly annoying to have not one, but TWO, steps to set up before hand to get these initial things all matched up + reconciled, but just know that it is the correct way. When you are expecting money, you SHOULD always have an invoice first, then when you get your payment you should mark that against the invoice, and THEN when you go to your bank reconciliation and SEE the money in your bank, only then can you match it. When you are starting out, these steps can feel a little silly in reverse, but it’s doing the right steps to get it clean.