It may seem convenient and easy for you to keep your personal and business finances in a single account; however, this offers several disadvantages. Indeed, opening different accounts for the two can prevent you from experiencing hassles. This will also provide you with different benefits.
Why You Must Open A Business Bank Account
Protection from legal liability – Opening a business bank account will protect your personal assets any legal liability. When your company gets sued and you are keeping your company and personal finances in just one account, the court might go after your personal assets since your bank account won’t reflect 2 distinct entities.
Tax purposes – Another excellent benefit of opening a separate account for your business is that it will be a lot easier for you to file business income and expenses for tax purposes.
Professionalism – Having a business bank account will lend credibility and professionalism to your firm. If clients see that you are using personal checks for transactions, they may assume that you’re not running a legal business operation.
Tips For Opening A Business Bank Account
Having a personal bank account won’t mean that you will easily open another account for your business. But your current bank might not necessarily be the best one of for your company. Bear in mind that banks specialise in various areas. Often, they cater to small businesses. However, there are other banking institutions that can provide reliable equipment loans.
Aside from opening a checking account, consider looking into other financial products as well. These include cash management and the different lines of credit. If you find a bank with extensive knowledge and experience in dealing with companies similar to yours, this may be the best bank for you as well.
The banking cost is another crucial factor to consider if you are choosing the best bank. Most banks today allow companies to open accounts for free. Also, they just require a minimal amount of balance. Sooner, the needs of your business might change and you may need to evaluate your account according to your fees along with the convenience the account offers. And if you choose to upgrade your account, this may lead to higher fees. Remember though that these might be offset by the ease in dealing with the increased volume of transactions. Ease of access to added services from the bank may offset such high fees as well.