Confession time – I am still using my business bank account from Nebraska even though I have lived in Texas for four years! I actually mail my checks to Nebraska!
Why? Picking out banks and changing them is not exactly a ton of fun! Yet, it is so important in small business to ensure you have the right bank account for your small business.
Today we are going to go over four things that will help you choose a bank for your small business.
First, small lecture time (I promise to keep this short) – you need to have a completely separate bank, and expense tracking system for your business. You cannot mingle your personal and business funds. So even though my bank is a good 8 hours a way, it is a business account and it is completely separate.
Okay done lecturing – now on to how to pick out the best checking account for your small business.
- Keep expenses as low as possible. The cash flow of your business is critical to a businesses success. There is no point in spending too much on bank fees when you can spend it on marketing, employees or saving for retirement!
- Look for a smaller bank that is willing to get to know you. I look for local/regional banks that can offer services, but not so big that I am just a number. This is also typically where you get the lowest fees, and sometimes the accounts are even free.
- Keep the bank separate from your personal bank. I like to keep my business accounts at different banks then my personal accounts. This way it is harder to co-mingle accounts. Practice this especially if you are operating as a sole proprietor, because the accounts will have very similar names and it can really easy to mess up deposits and withdraws.
- Ensure they have the services you need. No point in picking a bank that cannot give you what you need!
Action Time: No go out and find that small business account and get it set up. (I finally did it!)