Have you been thinking about opening a business checking account?
Odds are, when you first started your side hustle or business, you just deposited any money you made straight into your regular checking account.
But now, it’s becoming harder to keep straight what’s for your business, and what’s for you. Am I right?
That’s where a business checking account comes in. This makes it a lot easier to keep track of the business’s money, and creates a separation between the finances of the business and your personal finances.
If you have an accountant, then please talk about this step with them first. They might have some good recommendations that are specific to your situation.
If you don’t have an accountant – or don’t have the money to pay for one – then it’s time for some research.
First, get out a piece of paper and a pen.
How Does Your Business Operate?
- Are there a lot of cash deposits?
- Are there a lot of transactions? This includes deposits, checks, and ACH transfers
- Is there a high, steady balance?
- How much cash is available to start the account?
Write down your answers for each of these.
What Do You Want From a Bank?
- Is it important to be able to walk into a branch, or drive by and make deposits?
- Would you like an account that requires you to keep a low amount of money in the account, or that requires a high amount?
- Would you prefer a free account or interest bearing?
- Does your business need merchant card processing?
- Do you want an account that offers just a debit card, or a credit card as well?
- Do you want a lot of services from a bank, even if those services include additional fees?
Write down these answers too.
Now, Go Shopping
With your answers in hand, start shopping for a bank that fits your needs. Be sure to look at the big banks, banks that are local to you, and credit unions. You might be surprised by which of those options will be best for your business.
Before You Try to Open an Account
Opening a business checking account is a bit different than a personal account.
The bank that you choose will have different requirements for what paperwork they will need to see, and that paperwork can change based on what type of business you’ve opened. For example, if you have an LLC, then they might want to see your Articles of Organization.
- Find out what paperwork is required by the bank you’ve chosen
- Get all of that paperwork together
- Then open the account
Recap of Your Action Items
- Write down how your business operates (these are your needs)
- Write down what you want from your business account (these are your wants)
- Research and find a bank that meets your wants and needs
- Find out what paperwork that bank needs for you to open a business checking account
- Get your paperwork ready
- Open the account!