Wave Review (Formerly Wave Accounting)
- Numerous features
- Good customer support
- Easy to use
- Accrual accounting
- Attractive invoice templates
- Unsuited for large businesses
- No tax support
“No jargon. No complicated software. No MBA required.”
Wave, a free, cloud-based program that supports 2.5 million users, has been making ‘waves’ in the accounting world since 2010. From humble beginnings, the company has now grown to 150 employees. It has earned the place of #9 in Deloitte’s Technology Fast 50 List, the title of Best Free Accounting Software for Businesses by Business News Daily, and here at Merchant Maverick, we’ve named Wave the Best Free Accounting Software as well. And almost even more impressive, Wave still uses their own software to balance their books.
So why do we like it? Well, for starters, the software is completely free. Yes, there are additional costs for payroll, however, all of the standard features in Wave are free forever (there are no artificial limits like you’ll find with other ‘free’ accounting options). Wave’s beautiful, easy-to-use interface provides tools for invoicing, estimates, expense tracking, billing, contact management, advanced sales tax settings and more. The company has also just launched new Android and iPhone apps, added the first-ever lending feature, and is constantly updating the software to better fit customers’ needs.
The most recent updates address nearly every issue I had with the software previously. By adding a contact management feature, a bank reconciliation feature, and more reports, Wave, more than ever, is a great accounting software solution for small businesses.
Continue reading this article to learn more.
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Table of Contents
Wave “has always been and always will be free.” Unlike most free plans, Wave does not limit you to a certain number of invoices, customers, or transactions, making it one of the best free options out there. The software used to remain free because of small, unobtrusive ads within the software. Now, those ads are no more. The company generates enough revenue from credit card processing, payroll, and lending to keep the software completely free and your screen ad-free as well.
Here are some of the features available:
- Unlimited invoicing
- Unlimited estimates
- Contact management
- Expense tracking
- Personal accounting
- Supports multiple businesses
- Multiple users
You might be asking yourself: what’s the catch? Well, there isn’t one. You get all of the features listed above at zero cost to you. If you’re looking for further support or functionality, however, there are a few extra services you can purchase.
- Payroll: Wave Payroll begins at a base fee of $15/month (each employee costs an additional $4/mo). If you have 10 or more employees, that number drops to $2/mo per employee. (New York, Texas, California and Florida only have to pay $10/month).
- Credit Card Processing: Wave Payments enables online payments of invoices. Wave uses a pay-as-you-go model and charges 2.9% + 30¢ per transaction.
Cloud-Based Or Locally-Installed
Cloud-based. No downloads or installation required.
Hardware & Software Requirements
As cloud-based software, Wave is available on any computer, including Mac, Windows, and Linux. Up-to-date versions of browsers are recommended, but not required. The company also features three iOS apps: Invoice by Wave (iOS 7+), Receipts by Wave (iOS 7.1+), and Payroll by Wave (iOS 5+), as wells as two Android apps: Receipts by Wave (2.3.3+) and Invoice by Wave.
Specific Size Of Business
Wave is designed with the small business owner in mind. Not the small business owner with an MBA; not the trained CPA; but the everyday freelancer, independent contractor, or micro-business entrepreneur who believes in their work and their dreams. Wave supports multiple companies and unlimited users. Basic user permissions are available. A direct Etsy integration also makes Wave a great chose for these online sellers.
Ease Of Use
Wave is one of the easiest accounting software programs to set up. Navigation is simple, and overall organization is intuitive. The interface is pretty to look at too, which never hurts.
- Set Up: To set up your account, you simply enter your business name and the type of business you run; Wave does the rest. The software sets up a chart of accounts for you. All you have to do is go into settings and set your preferences (default invoice template, default invoice due date, sales taxes, etc.). The first time you enter the dashboard, Wave will give three options: 1) Send Invoices and Estimates 2) Track Income and Expenses 3) Set Up Payroll. You can use these suggestions as a guide or jump right into the other features. I recommend adding contacts and items first.
- Organization: Wave is simple and easy to learn – and the software has recently been redesigned to make navigation even more of a breeze. A dashboard of charts and graphs gives you a quick look at the financial state of your business. The menu on the left reads Dashboard, Sales, Purchases, Accounting, Banking, Payroll, and Reports. Each category drops down into sub-menus that show the key features in that section. There is a help button in the bottom left-hand corner of the screen and settings, integrations, and find an accountant buttons in the middle of the menu. There is also a new quick create button that serves as a shortcut to key functions.
- Instructions & Guidance: You likely won’t need much instruction or guidance since the software is so simple to learn. But if you do need help in the beginning stages there is a getting started guide in Wave University and a very helpful video demonstration that overviews the software. There is also a Help Center and a support form for more specific questions.
- Problems: While the user-experience is very nice overall, there are few minor hindrances to note.
- Glitchy: The software glitched on me a few times. Nothing major, just a few minor issues.
- No Cash-Basis Accounting: As it is a company that focuses on small businesses, I was surprised to find Wave does not support cash-basis accounting in addition to accrual accounting.
- Features Missing: The company has done an incredible job at updating their software, but there are a few more features I would like to see. More tax support and the ability to calculate deductions are two features that small business owners need. A project management feature would also be a nice touch.
For a free software, Wave offers a robust feature set that rivals even some paid accounting software programs – and the lack of limits on free features makes Wave even better. Below is a list of the basic features you can find in Wave.
- Dashboard: The dashboard features neat charts for Overdue Invoices and Bills, Income and Expenses, Bank Accounts and Credit Cards, and Payable and Owing.
- Invoicing: If you’ve read any of my other reviews, you know I’m a little bit picky about invoicing templates (or a lot bit picky). But I have nothing to complain about with Wave. Wave provides three distinct, yet incredibly professional invoice templates with customizations like color and logo. You can create default notes, headings subheadings, and footers. The company has also added additional customizations called column editing. This allows you to control which columns are visible on your invoices. You have the unique ability to create product-based invoice columns or service-based invoice columns (and can add as many custom fields as you like). You can also create recurring invoices, send receipts, set reminders, and easily see if your customer has viewed an invoice or estimate already. The only annoying part is that sales tax has to be set for each item when creating an invoice (rather than calculated off the total amount at the bottom of the invoice).
- Estimates: Estimates are also easy to create. There are three estimate templates as well, and you can send estimates using Wave, Gmail, Yahoo Mail, or Outlook. You can also export estimates as PDFs or print them to be sent by mail. There is no duplicate estimate feature yet (I’ve been told it’s coming soon). But in the meantime, after you convert and estimate into an invoice, you are left with a sent estimate; since the invoice is what matters, you can go in and edit the estimate and send it to a new client to save some time.
- Contact Management: The addition of a complete contact management feature is a huge upgrade. I was very glad to see that this feature offers full contact management capabilities, making it easy to save customer information. Under Sales, you can find the Customer Statements tab, which is also a nice supplementary feature. It gives you a complete overview of the invoices and transactions linked to a customer.
- Expense Tracking: You can either connect your account to bank live feeds or manually import bank statements. Note: Like almost all software using bank live feeds, Wave partners with Yodlee, which may violate some banks’ Terms and Conditions. Consult with your bank to see whether live bank feeds are a good choice for you.
- Receipts: Mobile apps make it easy to snap a picture of your receipt and organize it in Wave. You can also upload your receipts manually or email your receipts to Wave and they will take care of it for you.
- Bank Reconciliation: Another happy addition to the Wave family is the new bank reconciliation feature. You can use the bulk categorization feature to organize multiple expenses at once. This saves a lot of time and stress. We’re still waiting on custom bank rules, but those should be coming soon.
- Billing: Entering and paying bills is simple and easy to do. The only drawback is that you can’t set recurring bills.
- Time Tracking (Payroll Only): If you use Payroll, then you and your employees can track time and create timesheets.
- Item Tracking: I can’t quite call this feature “inventory” as there is no item tracking and zero reports regarding items. There is, however, a basic item list, which includes an item description, amount, account, and default sales taxes. Wave has conveniently split the items list into two different locations: items you sell are found under Sales, and items you buy are found under Purchases.
- Reports: In my last review, I only had access to three reports. Now Wave has restored their software to their original twelve reports. These reports include Balance Sheet, Income Statement, Sales Tax Report, Payroll Wage & Tax Report, Income by Customer, Aged Receivables, Expense by Vendor, Aged Payables, General Ledger, Account Transactions, Trial Balance, and Gain/Loss on Foreign Currency.
- Lending: This is one of the most unique features Wave has to offer. Wave now partners with OnDeck to help business owners get small business loans and to manage them easily from within their software. Read our article Lending by Wave: Everything Small Businesses Need to Know for more information.
- Sales Tax: The sales tax feature is pretty advanced for accounting software, especially a free one. You can set an indefinite amount of sales tax rates in Wave. You can also set compound taxes and differentiate between recoverable and non-recoverable sales tax.
- Multi–Currency: Wave supports multiple currencies and exchange rates are updated daily.
- Importing/Exporting: You can import contacts via .csv or google contacts and can import bank statements via .ofs, .qbo, .qfx, .aso, and .csv. You can export data via .xcel or .pdf and can print information as well.
Customer Service & Support
Wave offers customer service support from 9:00 am to 5:00 pm EST, and phone support from 8:00 am to 8:00 pm EST.
At the time of our last review, Wave had premium customer service plans that cost extra money. A few users took issue to this, so Wave enacted a new solution. They brought all of their customer services up to premium level, hired more employees, and did away with the paid system altogether. However, this does not mean that all users now have the once-premium phone support. Free phone support covers issues regarding Payroll, Credit Card Processing, and Lending; for everything else, there’s email. As nice as it would have been for everyone to get phone support, this isn’t a bad compromise. Payroll, Credit Card Processing, and Lending are all potential time-sensitive issues and require an extra level of responsiveness, which Wave provides.
For a free software, I was honestly surprised by the number of support resources offered. There are many paid accounting software options, QuickBooks included, which don’t provide this kind of sampling. What’s more, support form response time has improved significantly since the last time we reviewed Wave. All of my questions were answered in less than a day.
In addition, Wave has a good sampling of other resources including:
- Support Form: All customers receive free email support.
- Email: You can email the support center for general questions about Wave (this might not be the best place for troubleshooting inquiries).
- Phone & Chat: Phone and chat services are available for Payroll, Credit Card Processing, and Lending inquiries. Contact Wave for more details.
- Help Center: Wave provides a comprehensive Help Center. It’s a bit hard to navigate at times, but it offers helpful how-to articles and guides. These articles and guides are well laid out with easy to follow steps and plenty of screenshots for us visual learners.
- Wave University: Wave University is similar to a help center but focuses more on training people to use features, rather than troubleshoot features.
- YouTube: Wave offers over 85 YouTube videos and demonstrations that I found particularly helpful. There are short videos that explain each feature in detail or longer webinars that provide an overview of the entire software. The videos are a little outdated at this point, but not so much that they are obsolete.
- Small Business Tips: This section of the Wave blog is geared specifically toward small business advice.
- Blog: The entire blog is on Wave’s site.
- Social Media: Wave has Facebook and Twitter accounts, both of which they maintain regularly and use to post helpful articles and business insights. Facebook is a better place to look for customer service help, while Twitter is a better place to find a cute video or two about Wave kids and the Wave dog. The company also has a LinkedIn account.
Negative Reviews & Complaints
With a few exceptions, Wave reviews are positive across the board. However, there are a couple recurring issues that users have with the software:
- Slow Servers & Downtime: Wave has always had an issue with slow servers and downtime. While the company has been trying to address this issue by rewriting the software’s coding and by finalizing the switch to Amazon-hosted servers, recent complaints of this sort are still easy to find.
- Mobile App Bugs: Many users complained about mobile app bugs, particularly with Receipts by Wave.
- Limited Features: In addition to more reports, users request features like custom bank categories, billing subscriptions, API, and estimates functionality with the mobile apps. Quite a few of these customers were also frustrated because they felt that the company was not listening to their requests.
- Lack Of Integrations: Several people have complained about a lack of third-party integrations. However, with a new Zapier integration, this issue has definitely been resolved (more information below).
Positive Reviews & Testimonials
For the most part, Wave users seem genuinely pleased with the product. There are an ample number of reviews written about the software, and while many ratings have slightly dropped since our last review, comments are positive overall. Wave gets 4/5 stars on Software Advice, and 4.1/5 stars G2Crowd, and 7.9/10 stars on Trust Radius. Almost every app by Wave is rated at 4+ stars (out of five), with the new Android app coming in at 4.7/5 stars. In addition, Wave is BBB accredited and boasts an A+ on their site.
Some of the most common praise of Wave include:
- Price: You can’t beat free, and Wave users agree.
- User-Friendly: Users like the fact that it is easy to learn, easy to navigate, and easy to understand without all of the typical accounting jargon.
- Saves Time: Users also appreciate that Wave saves time, not just because it is easy to learn, but also because it is cloud-based and has mobile apps.
- Personal Accounting: The ability to manage personal and business accounts in a single place is a favorite with business owners, particularly freelancers, independent contractors, and eCommerce shop owners.
- Good Feature Selection: One of Wave’s most well-liked aspects is its robust feature set. Users especially like the receipt scanner, payroll feature, and multiple company support.
Here is what a few people are saying:
“I like Wave because it’s free. For most small businesses you really don’t need a ton of complicated features (depending on what you do), and for me this software fits the bill perfectly. It syncs my bank accounts, lets me label stuff so my accountant can sort through it at the end of the year, and did I mention it’s free?” – Scott E.
“Great for business beginners and advanced users. Compared to all the other cloud accounting choices it holds it’s own. Why make your business accounting difficult, isn’t running a business difficult enough?” – Cathy Fanning | IT Consultant
“Was VERY simple to integrate into my woodworking business. Since most if not all my transactions are electronic, categorizing my expenses has never been simpler. Thanks for eliminating my shoe box :)” – Puddle Town Woodworking
Integrations & Add-Ons
While Wave has dropped several integrations since the last time the first time I reviewed this software, they have added one major integration—Zapier. Zapier connects Wave users with nearly 500 third-party add-ons, which addresses one common complaint about the lack of integrations. (Note: the Zapier integration doesn’t show up on the Wave side of things. To access it, you have to go through Zapier’s site and connect to the Wave API). In addition to Zapier, the integration list includes:
- Paypal: Accept online payments and enable electronic payment of invoices. (Read our review here.)
- Etsy: Connects your Etsy store sales to Wave and provides a testimonial and media platform to promote your items.
- Shoeboxed: Replaces your receipt shoebox with a cloud-based expense tracking tool. Includes receipt scanning and expense reports.
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Wave currently uses 256-bit data encryption as well as a read-only version of banking information to protect private data. Data is automatically backed up, and servers are monitored 24/7 by physical security. The company is currently transferring to Amazon Web Hosting for added security and uptime (as slow servers and downtime are issues for Wave).
Wave has improved by leaps and bounds since our last review. The software was already great; now it’s nigh perfect. With a new contact management feature, bank reconciliation feature, restored reports, and a unique lending feature that isn’t seen anywhere else on the accounting software market, Wave is working hard to meet the needs of small business owners. The software is constantly updated and the company is growing exponentially. Hopefully, this growth will soon mean added tax support, deduction tracking, and maybe even project management.
The quality of the features the company does offer often rivals and exceeds that of paid software. With beautiful invoicing, easy expense tracking, strong customer service, and no artificial limits on the word ‘free,’ Wave is definitely worth a try.