What is a Personal Accountant? (15 Things Personal Accountants Do)

By isaac 10/06/2025 ACCOUNTANT, GUIDE 0 Comments

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What is a personal accountant? Simply put, a personal accountant is someone who can handle all your personal finance needs.

What is a personal accountant? What do they do? Find out in this article.

Who is an Accountant

This is a person who has accounting training. Most likely they have a college degree. They can handle bookkeeping duties.

An accountant knows how to work with financial records. They are trained to keep accounts for companies or individuals.

An accountant has the knowledge to set up financial records. They can maintain accurate books for a person or business. Their job may include designing record systems and preparing financial statements.

They can also give tax advice and prepare tax returns.

Who is a Public Accountant?

A public accountant works for many different clients. Each client pays them a fee for their services. They do more than basic bookkeeping.

A certified public accountant (CPA) has earned a state license. This license shows they have high-level skills and training. To get the license, they must pass an exam. They also need business experience and education.

CPA stands for Certified Public Accountant. It is a well-known title in the accounting world.

Must Read: How To Become ACCA-Certified Accountant In Nigeria

What is a Personal Accountant?

A personal accountant manages your personal money. They watch your cash flow.

They do your bookkeeping and help pay bills. They prepare tax returns and check bank statements. They make sure your credit card statements are correct.

Why do you need one? Most people don’t have time to study their financial records. Others don’t know how to spot errors. Personal accountants fill this gap.

Read How to: Become A Chartered Accountant Without A Degree In Accounting

How Much Does a Personal Accountant Cost?

Personal accountants typically charge in different ways:

Hourly rates: $50 to $150 per hour
Monthly retainer: $200 to $800 per month
Project-based: $500 to $2,000 for tax prep

The cost depends on your financial complexity. Simple bookkeeping costs less than full financial management.

15 Things Personal Accountants Do

As we look at what is a personal accountant, let’s see what they do.

Here are the important services personal accountants provide:

1. Managing your finances

You don’t legally need a personal accountant. But having one makes tracking money easier. They help you make smart financial choices.

2. Bookkeeping

A personal accountant tracks your transactions. This includes utility bills, loans, and credit cards. They also track mortgage payments and travel expenses.

Some costs can be deducted from taxes. Medical payments are one example. You need receipts and good records to claim these deductions.

Your accountant won’t follow you around recording purchases. Instead, they track receipts, cards, and bank statements.

Many will introduce you to software like QuickBooks. These programs make it easier to record transactions. The accountant steps in when you need analysis and reports.

3. Handling Taxes

Filling out tax forms is never fun. The good news is you can hire help. A personal accountant will prepare returns and tell you when to file.

If you’ve always done your own taxes, you might hesitate to delegate. That’s normal if money is tight.

But as your finances grow, taxes get harder. This is true for self-employed people too. A personal accountant makes sure returns are filed on time. They also help you avoid paying extra taxes.

They know about deductions you can take. For example, homeowners can deduct mortgage interest and property taxes.

To qualify, you must list all deductions. Personal accountants know this process. They help you list every expense for maximum deductions.

4. Personal Financial Advice and Planning

Have you ever gone to buy one thing and came home with many? Or planned a budget trip but spent all your money?

This happens to everyone. Whether you’re a big spender or impulse buyer, an accountant can help. They can help you manage money better.

First, they show how big purchases affect your other finances. Say you accidentally spend $2,000. Your accountant will explain why you can’t take that vacation next month.

Sometimes impulse purchases hurt your ability to pay important bills. Good personal accountants help create daily, weekly, and monthly budgets. This limits splurging and puts important bills first.

The accountant prepares regular reports about your expenses. They also give financial advice. If you have debt, they suggest ways to save money each month.

5. Offer Investment Advice

A personal accountant can help you save money to start a business. They look for tax breaks and help you avoid overspending. When you have enough cash, they can help you invest it.

They handle most of the financial planning. This includes tax forms, business plans, and loan evaluations. They also provide tax advice.

As your company grows, they help reduce your tax bill. For example, they might suggest putting money into life insurance instead of taking dividends.

Remember that personal income tax can be high. If you earn $300,000 from your business, you could owe $72,000 or more in taxes.

Your dividends might be only $228,000 after taxes. But if you invest in life insurance, you get the full amount plus interest. A personal accountant helps you make these smart business choices.

6. Handling Inheritance

Getting an inheritance can mean high inheritance taxes. You may also face high tax rates on income and property. A personal accountant advises you on what to do. They help ensure you only pay what’s required.

7. Structuring Gifts and Donations

Some gifts and donations are taxed like inheritance. The IRS requires tax on gifts over $18,000 per year per person. But you may qualify for tax breaks under certain conditions.

For example, if the gift is property the recipient will use right away, you might avoid taxes completely. Personal accountants look for these provisions.

Another option is making charitable donations from retirement funds. This lowers gift tax and raises the charitable value.

8. Paying Bills

Many Americans struggle with paying bills on time. It’s not always about lacking money. Some people forget until it’s too late. Others are too busy to make physical payments.

Not paying bills can hurt your credit score. With a personal accountant, you won’t worry about this. If they have access to your accounts, they’ll remind you to pay or pay for you.

9. Oversee Payment Arrangements

A personal accountant usually works behind the scenes. They won’t meet your landlord to give rent checks.

But sometimes they take the lead and negotiate for you. They can bargain with sellers for better deals.

Your accountant can also negotiate payment plans with creditors, the IRS, and banks. After all, they know your financial situation and stay objective when negotiating.

10. Recommend Other Professionals

If you have a problem outside their expertise, personal accountants can recommend help. Most have close relationships with people in similar fields.

If you need an insurer, banker, lawyer, or investor, ask your accountant first. They will find the right person for your issue.

11. Checking the Legality of Transactions

Most importantly, personal accountants check financial records for accuracy and legal compliance. If you fill out forms incorrectly, like tax forms, you might need to file amended returns with the IRS.

What’s the worst case? You could face tax evasion charges. This can happen if the IRS audits you and finds you withheld information. The IRS considers tax evasion a serious crime.

Personal accountants review transactions and documents to ensure compliance. This should take a big worry off your shoulders.

12. They aid in the assessment of business performance.

Your financial records show your company’s money situation and results. A personal accountant helps you understand your company’s finances better.

Clean and current records let you track expenses and profit margins. You can also compare recent data to past records and plan your budget.

13. Help With Retirement Planning

A financial advisor can help you plan for retirement and withdrawals. They help reduce the chance of running out of money. They manage sequence of returns risk.

By finding the right withdrawal rate, your accountant manages risks of low portfolio returns.

14. Contributes to the Growth of Your Professional Image

Having a personal accountant adds a professional touch to entrepreneurs.

When other professionals call your accountant instead of you about money matters, it looks more respectable.

An accountant’s speed and organization can also improve your reputation.

15. You’ll have a better chance of being approved for a loan.

Banks often require detailed financial information before approving loans. A personal accountant can prepare and organize this information. This greatly increases your chances of approval.

Accountants help clients estimate their needs. They also communicate the loan’s purpose to the bank. They can help clients figure out how to qualify for mortgages with passive income.

Can You Be Your Own Personal Accountant?

You can be your own accountant. Tracking income and expenses isn’t hard. It requires no accounting knowledge to do well.

Accounting software like QuickBooks for small businesses and Wave Accounting for individuals give you a complete picture. You can see your income, expenses, and ways to improve finances.

If you can’t afford a personal accountant, doing it yourself is great. But it takes more time and effort. You’ll also spend time filing your own tax returns.

At minimum, talk to a certified public accountant (CPA). Ask how you can maximize deductions to get bigger tax breaks.

Personal Accountant Vs. Financial Advisor: What’s The Difference?

A personal accountant is not the same as a financial advisor. Many people confuse the two. Financial advisors (also called financial planners) focus on three areas: budgeting, debt management, and investing.

Check Out>>> How To Prepare For A Financial Audit 2022

An accountant helps with bills, tax returns, and bookkeeping. A financial advisor only helps with financial planning.

If you want to save for college, a home, or retirement, see a financial planner. They also help with insurance planning, budgeting, debt payoff, investing, and estate planning.

Conclusion:

Many people hesitate to hire a personal accountant or financial advisor. I understand because some charge so much it’s not worth it.

The same could be true for personal accountants. You could use their service for a few months to learn how they help. Then decide if you want to continue. In the end, it’s up to you.

I hope you enjoyed this article. Now you know what a personal accountant is. Don’t forget to share it with anyone thinking about hiring their own personal accountant.

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