Imagine you start working for yourself as a freelancer. You don’t have any employees or business partners, so you don’t think you need a business checking account.
But something goes wrong with a client, and they sue you. Because your money is in one account, the client can take everything from you, even your personal finances.
Do you want to avoid this situation? Read on to learn more reasons why you need a business checking account.
Separate Your Finances
One of the best benefits of a business checking account is it can help you separate your finances. If you keep all of your money in a personal checking account, it can be hard to organize your money.
Keeping everything in the same account can also put your personal finances at risk if something happens in your business. If someone sues you or makes another claim, they could come for all of the money in that account.
Whether you have an LLC, corporation, or are a sole proprietor, you need as much protection as you can get. Opening banking accounts for your business is an easy way to organize everything.
Save for Taxes
Another reason to open a business checking account is to prepare for paying taxes. If you work for yourself, you need to pay self-employment taxes every quarter.
Maybe you don’t have that many business expenses, so different types of business accounts seem unnecessary. But you should open a separate account, even if you’ll only use it to save for taxes.
You can put a certain percentage into the account each time someone pays you. Then, you won’t have to worry about spending the money on other things.
Special Features
You may also want to compare business bank accounts and look for special features. Some bank accounts let you waive the monthly fee if you do certain things.
Other accounts provide consultations with a specialist to help you manage your money. Consider if you want any specific features to come with your business checking account that you may not get otherwise.
While you can find services without a business account, they may be just as expensive. But if you get an account that offers certain benefits, you can save money overall.
Add Business Partners
You may have started your business alone, and you might still want to be in control of it. But it never hurts to have a business partner to help with daily operations or a specific department.
When you add a business partner, you may not want to add them to your personal bank account. Even if you don’t think you’ll find a partner, you should open a separate checking account.
That way, you can add the new partner to that account when they join your business. Having a separate account will make it easier for both of you to run the company.
Outsource Banking Tasks
When you start your business, you may handle all of the banking yourself, so it doesn’t matter where the money is. However, you might want to outsource common banking tasks at some point.
If you need to do this, having a separate account will protect your personal finances. You may trust whoever you hire not to do anything scammy, but you never know.
Whenever you decide to outsource, you can add your new hire to the business account. They can do everything you need them to, and you can lower your financial risk.
Connect to Accounting
Whether you outsource banking or not, consider connecting your business checking account to your accounting software. If you did this with your personal account, you’d need to spend more time removing personal transactions.
However, you can connect a business account and import all of your transactions quickly. While you will need to verify they’re all correct, that won’t take as long.
And you won’t have to manually enter each transaction if you don’t connect your bank account. Now, this may not matter at the beginning, but it can save a lot of time as you make more sales and have more transactions.
Appear More Credible
As your business grows, you may need to write checks or send electronic checks. Of course, you can do that from a personal account, and the money can transfer the same way.
But giving a personal check to a vendor or employee doesn’t look very professional. Even if your business is your name, you can use business checks to appear more reliable and trustworthy.
Even if you don’t write checks often, it never hurts to have your business name on your account. Then, you can make sure everyone knows what your business is.
Getting a Business Loan
Maybe you don’t plan on writing checks, but you know you’ll probably need a business loan. Having a business checking account can help you improve your chances of getting one.
You can show potential lenders your business finances only. While your personal finances may look better, they can make it confusing for lenders.
Many lenders require bank statements and other financial records to approve a loan. If you can provide those records for your business finances, you can make it easier for everyone.
Manage Both Accounts Easily
If you already have a personal checking account with a bank you love, consider opening a business account at the same bank. You can go to the same branch to create the account.
Then, you’ll be able to manage both accounts from the same branch or using the same online banking portal. That way, you can easily transfer money to pay yourself, and you don’t have to learn a new system.
Or you can open a business checking account and a savings account at a different bank. If you want multiple accounts, using the same bank for them will help you manage and move money without needing to do as much work.
Will You Open a Business Checking Account?
Whether you run a brick-and-mortar store or offer online services, you need a business checking account. Not only can it help protect your personal finances, but you can plan for taxes and business loans.
And you can easily add business partners or employees to the account when necessary. Plus, you may find an account that offers extra features to help you run your business.
Are you ready to open a business checking account? Visit www.SignatureBankGA.com to get started today.
