How to Get Caught Up on Your Books When You’re Behind

Fell behind on your bookkeeping? You’re not alone, and it’s not too late to fix it. Whether it’s a few months or a full year of transactions, there’s a smart way to get caught up without losing your sanity.

Here’s how to do it, step-by-step.

Step 1: Start Where You Are

First things first - don’t let guilt keep you stuck. Life gets busy. You were running your business, serving clients, and maybe doing everything else too (including laundry, school pickup, and dinner). Instead of trying to “go back and do it perfectly,” commit to moving forward. You’ve got this!

Behind on your books doesn’t mean behind on your worth. This is your chance to clean things up and move forward with clarity.

Step 2: Gather What You Need to Get Caught Up

Before diving into the numbers, collect the essentials:

• Bank and credit card statements for all business-related accounts

• Invoices and receipts (digital or paper)

• Any previous bookkeeping spreadsheets or software exports

• Logins to your accounting software, if applicable (like QuickBooks Online or Xero)

  
  

Organizing your documents upfront is a key part of small business bookkeeping. It saves hours of searching later and helps you stay consistent.

Step 3: Tackle One Month at a Time 

Don’t try to do everything in one sitting. Break your catch-up work into manageable chunks by focusing on one month at a time. Start with the most recent month and work backward - or go oldest to newest if that helps you build momentum.

For each month:

• Categorize income and expenses

• Reconcile bank and credit card statements

• Look for recurring charges or subscriptions to evaluate

  
  

This approach is perfect for online bookkeeping for entrepreneurs who want progress, not perfection.

Step 4: Separate Personal and Business Transactions

If you’ve been using one account for everything (no judgment, we’ve seen it!), now is the perfect time to separate personal and business finances. This is essential if you want to maximize tax deductions for small businesses and stay compliant.

Having separate accounts is not just about tax season, it’s one of the best ways to stay organized for tax season all year long.

Step 5: Automate Where You Can With Cloud Bookkeeping Tools

If you’re using cloud bookkeeping software like QuickBooks Online, Xero, or Wave, connect your bank feeds to automatically import transactions. This feature can drastically reduce manual entry and free up your time.

Automation helps eliminate errors and makes your catch-up process smoother. It’s a cornerstone of virtual bookkeeping services that prioritize efficiency and accuracy.

Step 6: Know When to Outsource Your Bookkeeping

If you’re more than three months behind or feeling totally overwhelmed, this might be your sign to explore outsourced bookkeeping services. A professional bookkeeper can:

• Help you get caught up quickly

• Organize your chart of accounts

• Reconcile your statements

• Prepare accurate financial reports

  
  

Outsourcing allows you to get back to doing what you love without drowning in receipts or spreadsheets.

Bonus Tip: Use This as a Financial Reset for Your Books

Getting caught up isn’t just about checking a box. It’s an opportunity to:

• Open a separate business account (if you haven’t yet)

• Create a system to track income/expenses weekly

• Use cloud bookkeeping software that works for you

• Start reviewing reports monthly instead of yearly

  
  

Want help cleaning up your books and creating a system you can actually maintain? Start by grabbing our free guide: 10 Ways to Keep More Money as a Small Business Owner - it's full of smart, actionable strategies you can use right away.