Taking the Small Business Plunge | Day 6

Monday, October 6, 2014

Every smart business owner you talk to will tell you that it’s super necessary to have a separate bank account for your business. For one, it helps the government recognize that your small business income is in fact separate than your personal income. Also, since you have now been appointed as your own bookkeeper (love that small biz life), it will make it a thousand times easier to track what’s coming in and what’s going out.

So after you’ve got things all squared up with the government, you can ask that same kind-hearted business banker to open up some accounts for you. (They will be thrilled to do so.) Take what advice he or she has for you as to what kind of accounts you should have.

It’s possible you just want a checking and savings account. Maybe you want to add on a credit card if you’ve got some large purchases you’d like to make up front for your business. Do what seems best for you.

My only recommendation with this is that you stick with the bank you’ve already got your personal accounts at. It’s super easy to keep track of your money if it’s all in one place and it makes transferring funds when you’re ready to pay yourself waaaay easier.

Now you’ll want to put some moola in your brand spankin’ new checking account just to start out – it’s okay to use your personal funds to do so. For me, I think I put 100 bucks in or something.

What do you use your checking account for? The beautiful answer is anything business related. Coffee with a client, supplies, printing, postal service, paying an outside service, networking lunch…you name it. If it makes sense that your purchase directly relates to your business, then use that account. KEEP ALL YOUR RECEIPTS! Even if you buy things online, it will help your organization tremendously if you print out all your purchase confirmations just to have them all in one place.

Again, I’m not an expert and you should definitely ask a professional for tax and financial advice. I just want to share my personal experience with you because sometimes it helps to just chat with someone over virtual coffee about these things, amiright?

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