Xero vs Wave: Which Accounting Software Saves You in 2025?

Are you trying to figure out which accounting software is best for your business? 

It can be tough trying to pick between Xero and Wave, right?

Both say they can help you manage your money.

This article will break down what both offers.

We’ll examine the important details of Xero vs Wave so you can clearly see which software might be a better fit for you.

Overview

We’ve spent time clicking through both Xero and Wave.

Trying out their features, like sending invoices and tracking expenses.

This hands-on experience has given us a real feel for how each one works day-to-day.

Leading us to this straightforward comparison to help you choose.

What is Xero?

So, you’re looking at Xero? It’s a popular choice for many businesses.

Think of it as an online hub for managing your money.

It helps you send invoices, pay bills, and monitor your business’s performance.

Also, explore our favorite Xero alternatives…

Key Benefits

• Automatically imports daily bank transactions.
• Send professional invoices and get paid faster.
• Run over 50 types of financial reports.
• Connect with over 1000 other business apps.

Pricing

• Starter: $2.90
• Standard: $4.60
• Premium: $6.90

What is Wave?

Now, let’s talk about Wave. It’s known for being a free accounting software.

This is a big draw for many small businesses just starting.

It helps you handle invoicing, track income and expenses, and manage your cash flow without a monthly fee for the basics.

Also, explore our favorite Wave alternatives…

Key Benefits

Wave stands out with:

• A 100% free basic accounting plan.
• Easy to use interface for beginners.
• Seamless integration with its payroll add-on.
• Over 2 million small businesses use it.

Pricing

Free: $0
Pro Plan: $16

Feature Comparison

Now, let’s examine the specifics and see how Xero and Wave compare in terms of their actual work.

We’ll explore key features that business owners care about to help you clearly see the differences and similarities.

1. Dashboard Overview

• Xero: The Xero dashboard provides a clear, customizable snapshot of your key financial information. You can seamlessly view your bank accounts, invoices due, bills to pay, and cash flow at a glance.
• Wave: Wave’s dashboard also offers a good overview, highlighting income, expenses, and your bank accounts. It’s designed to be straightforward, especially for those new to cloud-based accounting.

2. Invoicing Features

• Xero: Xero allows for highly customizable recurring invoices & offers a ammonut of templates to suit different business needs. Its invoicing features are robust, including options for online payments and automated reminders.
• Wave: The Wave account offers unlimited invoicing features, even on its free plan. You can create professional-looking invoices and enable online payments to get paid faster.

3. Pricing and Plans

• Xero: Xero’s starter plan begins at $15 per month but has limitations on the number of invoices and bills. Their more comprehensive plans, like the Growing plan at $42 per month, offer more features for growing business owners.
• Wave: Wave’s core accounting solution is free, making it attractive for businesses on a tiny budget. However, features like payroll and online payments come with additional fees.

4. Bank Reconciliation

• Xero: Bank reconciliation in use Xero is a streamlined process that allows you to connect your bank accounts and match transactions quickly and efficiently. This helps ensure your records are accurate.
• Wave: Wave also offers bank reconciliation, letting you connect your bank accounts to match transactions. While effective, some users find Xero’s process slightly more intuitive.

5. Mobile App Capabilities

• Xero: Xero has a well-regarded mobile app that allows you to manage invoices, expenses, and contacts on the go. This provides flexibility for business owners who need to manage their finances remotely.
• Wave: Wave also offers a mobile app for invoicing and payments, allowing you to handle essential tasks from your phone. However, some advanced features might only be available on the desktop version.

6. Time Tracking

• Xero: Xero offers time-tracking capabilities as part of its higher-tier plans. This is individually useful for businesses that bill clients by the hour and need to track time accurately for projects.
• Wave: While Wave’s free accounting doesn’t include built-in time tracking, it does offer integrations with other apps that do. This might be an extra step compared to Xero.

7. Scalability for Different Business Sizes

• Xero: Xero is generally considered a strong accounting solution for both starter businesses and large businesses due to its scalable plans and extensive features. Many customers appreciate its ability to grow with their needs.
• Wave: Due to its free starter plan, Wave is often favored by very small businesses and freelancers. While it can handle growth to a certain extent, large companies with more complex needs might find QuickBooks Online or Xero more suitable in the long run. When you compare Xero and Wave for larger operations, Xero often comes out ahead in terms of advanced features and integrations.

What to Look For When Choosing Accounting Software?

• Here are a few extra things to keep in mind:
  • Think about integrations with other tools you use.
  • Consider the level of customer support offered.
  • Check if the software suits your industry’s specific needs.
  • Look at security features to protect your financial data.
  • Estimate your transaction volume to avoid hidden fees.

Final Verdict

Choosing between Xero vs Wave?

If you’re on a tight budget, Wave’s free plan is great to start.

But if your business is growing and needs more connections and better reports.

Xero is also a solid choice.

It might cost around that 40 per month mark.

But it can save you time for businesses needing more power.

We think Xero is the better pick overall when looking at Wave vs Xero.

More of Xero

• Xero vs Puzzle IO: Puzzle IO emphasizes AI-powered insights and real-time financial statements for modern accounting.
• Xero vs Dext: Dext focuses on AI-driven data extraction from receipts and invoices for seamless Xero integration.
• Xero vs Synder: Synder specializes in automatic synchronization of e-commerce sales and payments with Xero for easy reconciliation.
• Xero vs Easy Month End: Easy Month End is a workflow tool designed to streamline & manage the month-end closing process with Xero.
• Xero vs Docyt: Docyt aims to automate bookkeeping tasks using AI, offering real-time visibility into business finances.
• Xero vs RefreshMe: RefreshMe’s standout feature involves real-time financial data refreshing and reporting within spreadsheets.
• Xero vs Sage: Sage offers a broad suite of accounting solutions, known for strong compliance and inventory management.
• Xero vs Zoho Books: Zoho Books provides a comprehensive accounting solution tightly integrated with the Zoho ecosystem.
• Xero vs Quicken: Quicken is known for personal and small business finance management with budgeting and tracking tools.
• Xero vs Hubdoc: Hubdoc excels at automatically fetching and organizing financial documents directly into Xero.
• Xero vs Expensify: Expensify is a robust expense management tool that seamlessly integrates with Xero for receipt tracking and reporting.
• Xero vs Quickbooks: Quickbooks is a popular accounting software known for its user-friendliness and wide range of features for small businesses.
• Xero vs AutoEntry: AutoEntry automates the capture and data entry of invoices, receipts, and bank statements into Xero.
• Xero vs Freshbooks: Freshbooks is designed for service-based businesses, focusing on streamlined invoicing and time tracking.
• Xero vs Netsuite: Netsuite is a comprehensive cloud ERP system with advanced accounting, suitable for larger enterprises.

More of Wave

• Wave vs Puzzle IO: Puzzle IO emphasizes AI-driven automation and real-time financial insights for modern businesses.
• Wave vs Dext: Dext focuses on automating data extraction from receipts and invoices, streamlining expense management.
• Wave vs Synder: Synder specializes in automating e-commerce sales data synchronization with accounting systems.
• Wave vs Easy Month End: Easy Month End streamlines the month-end closing process for finance teams.
• Wave vs Docyt: Docyt uses AI to automate bookkeeping and back-office tasks.
• Wave vs RefreshMe: RefreshMe centers on real-time financial reporting within spreadsheets.
• Wave vs Sage: Sage offers comprehensive accounting solutions, particularly strong in compliance and inventory management.
• Wave vs Zoho Books: Zoho Books provides a suite of accounting tools integrated within the broader Zoho ecosystem.
• Wave vs Quicken: Quicken is tailored for personal and small business financial management, including budgeting.
• Wave vs Hubdoc: Hubdoc automates the fetching and organization of financial documents.
• Wave vs Expensify: Expensify automates expense reporting with receipt scanning and policy enforcement.
• Wave vs Quickbooks: Quickbooks is a popular small business accounting solution with a wide array of features.
• Wave vs AutoEntry: AutoEntry automates data entry from invoices and receipts into accounting software.
• Wave vs Freshbooks: Freshbooks is designed for service-based businesses, focusing on invoicing and time tracking.
• Wave vs Netsuite: Netsuite is a comprehensive cloud ERP for larger enterprises, with advanced accounting capabilities.

Frequently Asked Questions