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In this Xero vs FreshBooks comparison, Xero outperforms both FreshBooks and Sage in overall accounting software evaluation due to its comprehensive feature set and library of over 1,000 third-party integrations.
FreshBooks and Sage are still worth considering. In fact, FreshBooks may be best for cost-conscious freelancers, since it offers limited features at a low starting cost ($4.60 for the first four months with a deal), and comes with 24/7 support.
In contrast, Sage 50 comes with a higher bill, but larger companies will benefit from its cashflow tools and fraud protection.
Read on to compare all the key features, price plans, and support options for these three accounting platforms. If you want, you can even cut to the chase and compare the best deals now with Tech.co’s comparison tool.
- Xero beats FreshBooks and Sage due to its comprehensive features, budget manager available on all plans, and over 1,000 third-party integrations.
- FreshBooks is the best value for money, starting at $23 per month and offers 24/7 support, built-in time tracking, and website builder integrations.
- Sage 50 targets larger enterprises with advanced cash flow projections, purchase order approvals, and Sage Security Shield fraud protection, but has a higher starting cost of $132.17 per month.
- Free trials differ across platforms, with Xero and FreshBooks offering full-featured 30-day free trials, whereas Sage 50 only provides a 30-day demo.
- Xero provides superior brick-and-mortar support by integrating directly with major EPOS systems like Square, Vend, and Revel.
We’re committed to making accurate verdicts at Tech.co, so when comparing accounting software, our research team measures a number of metrics, including ease of use, advanced features, and support tools. Jump to our methodology section to learn more about our thorough and independent research process.
Xero vs FreshBooks vs Sage: Head-to-Head
Xero is a better solution than FreshBooks and Sage because it has better features overall (including a handy budget manager), a decent value for its cost, and lots of integrations.
In fact, Xero is the second-best accounting software for small businesses after QuickBooks Online, and the second-best overall, making it a sturdy option for businesses of any size. It has top-notch accounting and planning tools, all the collaboration and AI tools you’ll need, and plenty of third-party integrations to boot.
But if you’re just looking for the basics, FreshBooks may be for you. Across the Xero vs FreshBooks matchup, FreshBooks has more limited features than Xero, including a lack of forecasting and budgeting tools and a mobile app with few functions. It has better prices than Xero, however, so it might be attractive to cost-conscious freelancers or smaller businesses, since they are less likely to need advanced features.
Sage 50 is a desktop-first platform with optional cloud features, requiring manual daily data backups to prevent data loss. It costs more, too, starting at about $132.17 per month. However, it offers helpful features, including its own fraud prevention system, Sage Security Shield.
Despite this, Xero and FreshBooks’ better features and lower costs make them both better picks.
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Xero |
FreshBooks |
Sage 50 |
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$132.17/month |
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30 days |
30 days |
30 days (demo only) |
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Experienced accountants and established businesses with complex financial needs |
New businesses |
Businesses seeking tailored financial solutions and strong brand reputation |
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| Try Xero now | Try FreshBooks | Compare Prices |
Best for Accounting Features: Xero
Xero offers the most robust accounting feature set compared to FreshBooks and Sage, featuring key assets like a budget manager on all plans, fixed asset tracking, and over 1,000 integrations.
While FreshBooks offers useful core accounting tools (including time-tracking across all plans), it lacks custom reporting and multi-currency invoicing across all plans, in addition to a more limited mobile app than Xero.
Xero has the best financial management tools
If financial management is your top priority, Xero is the better choice overall. FreshBooks completely lacks budget and forecasting tools, and Sage only offers audit trails on its Premium tier.
Xero also has the best expense management functions: Users can easily upload receipts, log miles driven, and link expenses so that clients know what they’re being billed for. Plus, creating client profiles for billing is simple (and users can adjust which currencies and descriptions apply to each client).
I found uploading receipt images, logging mileage, and linking expenses to clients straightforward and valuable. In particular, the bills function stood out for its ease of creating clients, adding descriptions, and adjusting currencies.
Moreover, unlike Xero and FreshBooks, Sage lacks project accounting tools like time tracking and project cost calculations (although it offers job management), making it the least versatile solution out of the three. If you’re looking to carry out basic accounting, financial reporting, and bookkeeping functions, however, Sage will still be up to the task.
Best for Help and Support: FreshBooks
FreshBooks delivers the strongest customer support in this comparison by offering 24/7 live assistance across all tiers.
All three options offer online knowledge centers with video tutorials and webinars, but Xero does not offer phone support, email, or live chat, while Sage does not offer email support, and FreshBooks’ email support is only available on request. Sage and Xero also have community forums, while FreshBooks does not.
Sage stands out for its Sage University feature, which gives users access to on-demand learning and instructor-led classes. All Sage 50 plans come with the Sage Security Shield fraud prevention system, too, stopping problems like ID theft and cyber threats before the need for support arises.
Best Value: FreshBooks
FreshBooks offers a better value for its cost, compared with Xero and Sage.
The Xero vs FreshBooks pricing split starts at $27 per month for Xero’s Early plan, while FreshBooks’ Lite plan costs $23 per month. The next highest plans offer the most functionality, and FreshBooks comes out ahead with its Plus plan available for $43 per month, compared with Xero’s Growing plan at $59 per month.
FreshBooks might have a better price, but with premium accounting features like recurring bills and expense tracking available on all of its paid tiers, Xero remains a safe bet for businesses with a keen eye on their bottom line, and offers a powerful system in return.
Granted, if cutting costs is a top priority, I was most impressed with the FreeAgent accounting solution, which offers a $27 per month plan that’s comparable to FreshBooks Plus or Xero Growing.
Check out our guide to the best expense management software to learn more
To see how the providers’ main plans weigh up, check out our comparison table below:
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Price
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Users
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Bookkeeping
Does it include bookkeeping functions?
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Accounts payable
Does it include a range of accounts payable functions?
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Accounts receivable
Does it include a range of accounts receivable functions?
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Project accounting
Does it offer tools to track different projects?
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Financial reporting
Does it offer financial reporting tools?
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Budget and forecasting
Does it offer budgeting and forecasting tools?
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Sage 50 |
Sage 50 |
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Premium |
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$132.17/month |
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$182.50/month |
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Unlimited |
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Unlimited |
1-5 |
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Expenses tracking only |
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Time-tracking only |
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If you’re looking to unlock advanced accounting features, FreshBooks also offers a Premium plan at $70 per month, with competitive accounts payable and project tools, and a custom-priced Select tier for businesses with complex needs.
Xero offers a premium Established plan too, for $97 per month. This package offers just about every accounting feature under the sun, including multi-currency record payments, employee labor calculations, and custom reporting tools.
You can read a full breakdown of Xero’s pricing model here.
Which Accounting Platform Has the Best Free Trial?
While none of these software solutions offers free versions, Xero and FreshBooks let users test out their products for 30 days, free of charge. Xero offers the strongest free trial, unlocking its full suite of features and 24/7 online support channels to users who sign up.
FreshBooks provides a 30-day free trial covering core invoicing, bank syncing, and tax summaries. In contrast, Sage 50 merely offers a 30-day demo version, with autopopulated data that shows users how it works, but isn’t actually functional.
Best for Integrations: Xero
If you’re looking to combine your product with other software, Xero is the best option. Thanks to its expansive app store, which is home to over 1,000 add-ons, users can choose from a range of integrations, from CRM solutions like HubSpot to payment services like Stripe.
What’s more, unlike FreshBooks and Sage, Xero can integrate with leading EPOS systems too, including Square, Vend, and Revel – making the tool perfectly suited to brick-and-mortar stores with existing point-of-sale software.
FreshBooks also boasts its very own app store, with over 100 options available, including useful ecommerce tools and accounting add-ons. But while FreshBooks integrations are stronger than Sage, they still pale in comparison to Xero’s.
FreshBooks is best for online stores
While FreshBooks’ total feature offering falls short of our frontrunner, Xero, it is a good accounting software for online businesses because of seamless integrations with major website builders like Shopify, BigCommerce, and Squarespace.
Paired with the robust inventory management tools included on its lowest tier, these integrations make FreshBooks especially useful to online retail stores and food delivery businesses.
How Do Xero, FreshBooks, and Sage Compare With Other Software?
Zoho Books is the best accounting software overall, thanks to its first-class inventory tracking, great transaction documentation and comprehensive mobile app.
QuickBooks is another top alternative worth mentioning, too, with powerful cash flow projections, detailed reporting functions, and simple, easy navigation.
The market is packed with credible accounting software services, however, so check out our table below to see how they compare in full:
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Xero |
FreshBooks |
Sage 50 |
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$132.17/month |
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30 days |
30 days |
30 days (demo only) |
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Experienced accountants and established businesses with complex financial needs |
New businesses |
Businesses seeking tailored financial solutions and strong brand reputation |
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| Try Xero now | Try FreshBooks | Compare Prices |
Our Methodology
At Tech.co, we take our impartial research and analysis seriously, so you can have complete confidence that we’re giving you the clearest, most useful recommendations.
After conducting an initial investigation to identify the most relevant, popular, and established accounting tools in the market, we conducted further research, including testing six major accounting software platforms.
Based on years of market and user needs research, we’ve established an accounting software testing methodology that scores these platforms against six main categories, and 25 subcategories — with a total of 1,512 areas of investigation being considered overall.
We also put the platforms through their paces with hands-on testing to gain a deeper grasp of their average user experience. We dedicated 57 hours to carrying out 37 user tests, with a total of 555 tasks being completed in total.
Our main testing categories for accounting software are:
- Core accounting features: We check how adept a platform will be at managing accounting tasks, focusing on key bookkeeping features like invoicing, tax preparation, journal entry, time tracking, financial transactions, and payment support.
- Operational efficiency: We determine how capable a system is at ensuring day-to-day processes run seamlessly, paying close attention to third-party integrations, collaboration tools, AI automation, and customization options.
- Financial planning: We assess how capable a system will be at measuring income, profits, and losses. Specifically, we check for the presence and quality of forecasting and budgeting, inventory management, reporting, and compliance tools.
- Help and support: We assess how useful and reliable a platform’s support system is, focusing on support options, whether it’s 24/7 support or knowledge center accuracy, as well as cloud backup, and security safeguards.
- Pricing: We compare the overall cost of each platform, taking factors like monthly costs, set-up fees, hidden fees, and free plans into account. We also measure how strict contracts are, and how much it would cost for a business to terminate them early.
- User experience: An overall judgment of how easily users can interact with the platform. We tested each accounting platform and got our team to report how easy they were to use, how they felt when they were using them, and how likely they were to recommend the platform to another business.
When it comes to calculating a product’s final score, not all testing areas are weighted evenly, with factors like “core accounting features” and “operational efficiency” being prioritized for small businesses, while sector-specific features are valued more highly for businesses across different industries.
We understand that accounting software is always evolving. That’s why at Tech.co, we have full-time product researchers to re-run this testing process regularly. It’s the only way to ensure our results remain reflective of the present day.
Learn more about our research.
If you’re stuck between these three providers, we would recommend using Xero. Xero is a more versatile piece of software than FreshBooks and Sage, with a solid range of basic accounting features, an extensive app store, and top-tier budget, forecasting, and project management tools.
However, while FreshBooks lacks POS integrations and basic budgeting tools, our research suggests it’s a dependable option for online stores because of its impressive ecommerce add-ons and stock tracking tools.
When picking between the three accounting solutions, it really comes down to the needs of your individual business. If you’d like to see a simpler breakdown of our top providers, check our handy form today.
Frequently Asked Questions
Xero is the most practical choice for businesses handling foreign currencies. Xero includes multi-currency support on its Established plan ($97 per month), automatically converting currencies and tracking gain/losses in real time.
FreshBooks does not support multi-currency invoicing across its plans, while Sage 50 requires higher-tier configurations to handle multi-currency accounting efficiently.
Xero is highly scalable as it allows unlimited users across all its plans and supports payroll additions through integrations like Gusto, making growth seamless without per-user plan fees.
While Sage 50 scales well for complex corporate accounting, adding users gets expensive as role-based user permissions are restricted to the top tier.
On the other hand, FreshBooks is less suited for mid-sized growing teams, because base plans are capped at one user and extra team members incur additional monthly fees.
FreshBooks provides basic inventory tracking on its entry-level plan, making it convenient for small retail or online storefronts.
Xero includes robust, tracked inventory tools for basic stock items and seamlessly integrates with advanced inventory systems (like DEAR or Unleashed) through its app marketplace.
Finally, Sage 50 offers advanced assemblies and trackable item lists, making it superior for complex manufacturing or multi-warehouse tracking, though it lacks modern app store flexibility.
Xero and FreshBooks are cloud-native platforms, meaning data is encrypted, stored off-site, and automatically backed up continuously without requiring user intervention.
In contrast, Sage 50 is a desktop-first application. Although it offers cloud-connected features, users must perform manual daily data backups to prevent loss in the event of local hardware failure.
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