QuickBooks vs. FreshBooks vs. Wave: Best Accounting Software for Childcare & Nanny Businesses
Running a childcare business means tracking more than just playtime. You need to know what you're making from parent payments, what you're spending on snacks, craft supplies, and cleaning, and if your hourly rate or weekly fees truly cover your costs. QuickBooks, FreshBooks, and Wave are popular tools to manage your money, but they suit different types of childcare operations. Here’s how to pick the best one for your home daycare, babysitting service, or nanny business right now.
READY TO TAKE ACTION?
Use the free LaunchAdvisor checklist to track every step in this guide.
The quick answer
Wave is the best free choice for solo babysitters, part-time nannies, or small home daycares with only a few children. FreshBooks is ideal for dedicated nannies or growing home daycares that send detailed invoices to parents and want to track time per child or family. QuickBooks is the industry standard for larger daycares with multiple staff, different payment structures, or when you hire an accountant specializing in childcare businesses.
Side-by-side breakdown
Wave: This option is completely free for managing invoices to parents, tracking all your income and expenses (like snacks, art supplies, or field trip costs), and scanning receipts. You only pay transaction fees if parents pay you directly through Wave. It has basic reporting, which is fine for a solo babysitter making under $20,000 a year or a home daycare with 1-3 children. It's not built for complex reports or payroll beyond yourself.
FreshBooks: Starting around $19/month, FreshBooks shines for sending professional, easy-to-read invoices to parents. It's great for tracking the time you spend with each child or family, and you can see how profitable each client is – for instance, if Family A’s payments cover the special art supplies or extra hours you provide. It’s perfect for nannies or home daycares that need strong client-based billing but don't handle inventory like bulk diapers for 10+ kids.
QuickBooks: Priced from about $35/month, QuickBooks is the big player. Most bookkeepers and accountants who work with childcare businesses know it inside and out. It handles everything: payroll for your daycare assistants, tracking inventory (like bulk purchasing of diapers or educational toys), detailed tax preparation, and comprehensive reports. It takes more time to learn but offers the most complete system for a growing childcare operation.
When to choose Wave
Choose Wave if you’re just starting your babysitting service, working as a part-time nanny, or opening a small home daycare with 1-3 children. It's perfect if your budget is tight, or you only need to send simple invoices to parents and track basic expenses like a new pack of crayons or a playground pass. The free version is fully functional, not a limited trial. Consider switching when you hire your first daycare assistant, grow to 5+ children, or need more detailed financial reports for tax time beyond simple income/expense tracking.
When to choose QuickBooks
Choose QuickBooks when your childcare business has grown significantly. This means you might have multiple employees or contractors (like specialized tutors or relief staff), you're running a larger daycare with 10+ children, or you have different income streams (e.g., daily care, after-school programs, summer camps). If your accountant, who likely understands childcare-specific deductions and grants, recommends it, that’s a clear sign. It’s built to handle complex payroll, extensive expense categorization (like food program reimbursements), and preparing detailed financial statements for lenders or investors.
The verdict
Start with Wave if you're a solo babysitter, a new nanny, or running a very small home daycare with fewer than 5 children and making under $5,000 per month. Move to FreshBooks if your business is service-based, like a dedicated nanny or a growing home daycare (5-10 kids) where sending professional invoices and tracking time per child or family is key. Upgrade to QuickBooks when your complexity demands it – perhaps you have multiple staff, manage significant inventory, or your accountant specializing in childcare businesses tells you it's time.
How to get started
Open a free Wave account today and connect your business bank account. Take the time to categorize every transaction from the last 30 days. This single step—knowing exactly where parent payments are coming from and what you’re spending on snacks, art supplies, cleaning supplies, and liability insurance—is more valuable than any pricing trick. You can't make smart decisions about your rates or expenses if you don't clearly see your money.
RECOMMENDED TOOLS
Wave
Free accounting, invoicing, and receipt tracking — no monthly fee
FreshBooks
Best invoicing and time tracking for service businesses
QuickBooks
Industry standard — works with every bookkeeper and accountant
Some links above are affiliate links. We may earn a commission if you sign up — at no extra cost to you.
FREQUENTLY ASKED QUESTIONS
Can I switch from Wave to QuickBooks later without losing data?
Yes. You can export your chart of accounts and transaction history from Wave and import into QuickBooks. The migration takes a few hours and is worth doing at a fiscal year boundary to keep your records clean.
Does Wave really have no monthly fee?
Wave's core accounting, invoicing, and receipt scanning features are free. Wave charges transaction fees when customers pay invoices through the platform (similar to Stripe or PayPal). Payroll is a paid add-on starting at $20/month.
Apply This in Your Checklist