Starting a Business with Pocket Change Part 3

change jar

In Part Two of Starting a Business with Pocket Change (you can also read part 1 of this series) I discussed specific steps to take and purchases to make when it’s time to create a business identity and launch your business. This next article in the series will touch on free software for running your business. Productivity and money flow are the lifeblood of any business, no matter what the size. Being able to get a handle on these will make running the rest of your business that much smoother.

Productivity and Time Management

Task Coach is OpenSource software that can make planning, tracking, and even invoicing a little bit easier. It’s based on a pretty simple premise: tasks can be broken down into subtasks, and when the subtasks are done, the main task is done. I use this software to keep track of time I spend working on projects both at my computer and away ( i.e. meetings, travel time, etc.).

When I use the software, I create a single task for each project and then fill that project with all the actions (subtasks) I need to do to complete the contract. Tasks and sub-tasks each have their own start, end, and completion dates, plus they each have an area where you can list an hourly rate or a fixed rate. This is great for those of us who bill some things hourly (like business card design) and other things on a fixed rate (like a box of 1000 business cards).

Once the project and sub-tasks are set-up, it’s time to to start working. The ‘Task List’ tab creates a list of all your tasks from all your projects and groups them by completion status. You can then sort which ones are due first and select one to work on. Start tracking your effort (aka the work you’re doing on the project) in real-time by highlighting the task you are going to work on and then clicking the appropriate stop watch icons to start and stop tracking your time. If you want to track something you did away from your computer or office, you simply right-click the task in question and select ‘New Effort’.

When a sub-task is completed, highlight it and click the button next to the stop watch to ‘Mark Task Completed’. This removes the task from your list of incomplete items, and more importantly it calculates the revenue if you gave the task an hourly rate. The time spent and total revenue for a sub-task is added to the running total for the main project when the sub-task is marked complete, so you’ll always know at a glance how much time you’re spending on a project and how much revenue it’s bringing in. When it comes time to invoice, you’ll have every detail available and can be as general or specific in your billing as necessary.


There are countless ways to get your bills to your customers, including handwritten statements, an Excel or Word printout, or using a specific piece of invoicing software. All of them are suited to different situations, and it’s up to you to decide which one will work best for your business.

The most powerful pieces of free invoicing software nowadays are often designed to be web-based and frequently require a database backbone. If you’re interested in a review of these types of products, let us know in the comments. For the purpose of this article, however, I am going to focus on options that can get you up and invoicing the quickest.

If you’re billing customers that will want to pay by credit card, you’ll probably want to start with the PayPal Invoice generator available from within your PayPal account. It will allow you to itemize your bill, and customers receive an email invoice can pay with a credit card without having a PayPal account. With the focus on security and identity theft nowadays, it’s becoming more and more legitimate to not actually handle the card information yourself. You might find you have customers who actually prefer to be billed in this type of fashion.

For standard invoices, you have a variety of options available to you. Most word processing and spreadsheet applications come with a default invoice template you might like. Or, you might be able to sick with handwritten invoices depending on your business type.

Another option, though, is to try an online service like With this free system you can create invoices online without downloading a separate piece of software. If you have access to a web server you can create customized estimate and invoice templates for either printing or emailing to customers. has you create a client, then create a project for that client, and then add services (i.e. web design) and material (i.e. business cards) to the project. You can mark a project as complete in order to create an invoice, or you have the option to create invoice percent/amount increments in order to charge portions of the bill over the lifetime of the project. This option allows you to bill in a format such as “50% down, remainder due on delivery”. You also have the ability to create an invoice for a ‘neverending’ project that gets billed every month, year, etc.

The only drawback to this service is that the email invoices are currently not able to send HTML code, so you’re not able to send a PayPal payment link just yet. However, I’ve spoken with the owner and she says that this feature has been requested and is already in the works.


First, let’s clarify that if you are serious about running a business full time it will almost certainly be in your best interest to meet with an accountant at some point down the road.

With that said, I do want to talk about jGnash. This software is programmed in Java so it should work on whatever operating system you have, and is set-up to handle the double-entry bookkeeping that is common with most businesses. If you’ve never used double entry it can be confusing, but WikiPedia has a farily in-depth tutorial.

The easiest way to get started with this software is to create sub-accounts underneath the default Bank/Expense/Income accounts that are installed. For instance, under Bank you would have a sub-account for checking. Before you get confused about what to put under the Expense and Income accounts, it might help to think of accounts as ‘categories’. So, under Expense you would have sub-accounts (or categories) for where you spend money ( i.e. suppliers and fees), and under Income you would have sub-accounts for all of your income sources (i.e. customers and ad revenue). One thing to note: if you want to really see how things are going, you will want to set-up an income account AND an expense account for the Personal Loan you gave your business (aka the change you saved), since that will start as money coming in and should wind up as money flowing back out when you repay yourself.

Once you’ve got this part set-up, enter your transactions in the main bank account like you would in any other personal finance software. The only real difference is instead of picking a category for an item, you assign it to the appropriate income or expense account. Be forewarned: some expenses will show a positive balance and your income will show a negative balance! This is normal for double-entry accounting; you can check the numbers yourself by running a Profit and Loss (P&L) report in jGnash once you’ve entered in some data.

The first entry will be a deposit into the bank account under Income: Personal Loan. Now you will have a positive balance in the checking account and a negative balance under Income accounts. Any time you make a payment back to yourself for that personal loan, it would be categorized under the Expenses: Personal Loan account.

One of the really nice things about this software is that it will let you split one transaction among several different categories. For instance, I accept a $10 payment for an invoice, but $0.59 of that goes to PayPal for fees. When I enter the transaction into the checking register in jGnash, I click the button to ‘split’ this transaction and mark a deposit of $10 on the Income:Invoices account and a withdrawal of $0.59 on the Expenses: PayPal Fees account.

One Stop Shop!

Looking for something we haven’t listed yet? Check out 101 Essential Freelancing Resources over at It’s actually up to 125 now, after all the reader contributions.

Stay tuned for Part Four of this article series, which will cover finding clients and marketing your business.

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5 Responses to Starting a Business with Pocket Change Part 3

  1. Henry @ Binary Dollar says:

    I want to also mention that Microsoft has a free Accounting Express product that looks pretty cool.

    I wish someone had a free online accounting software.

  2. Tina Parcell says:

    There are actually several pieces of no-cost OpenSource accounting software that are designed to be web-based by installing them on the server that hosts your website. If you are interested, I’ll be happy to investigate a few and possibly create a demo area on my site where you can see them.

  3. Henry @ Binary Dollar says:

    Naw. Probably not worth the effort. Thanks Tina. I appreciate it a lot.

    You’d think there was a free service open to the public though. You know?

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