Where do businesses keep their money?
Some people choose to keep their business profits at home or in their retail space, but we recommend that you create a business bank account to keep your money safe and insured!
Keeping track of your expenses and financials is an important part of running a business. It will help you file your taxes effectively and save you the stress and heartache that comes with poor management of finances.
Should I keep business and personal accounts separate?
As a business owner, you should be keeping your personal money and expenses separate from your business’ or organization’s money and expenses. It’s never too early to start a business banking account. A lot of banks offer free business checking accounts and debit cards.
There are also business credit cards that have special rewards for spending a certain amount of money and offer you more credit to make big purchases. Just be very cautious to not rack up spending you can’t pay off and to pay off any annual fees on the credit card(s).
Put some money in your business checking account, and only use the debit card or credit card associated with the account to pay for your business expenses. Then, every time you get money from the sale of your products or services, put that money into your business checking account to replenish your debit card or to pay off your business credit card.
At the end of each month, your banking statements will give you a quick snapshot of how much you spent and made. If you’re using the money you earn to pay off business related expenses on your credit card and debit card charges and you have money leftover, that’s a very good sign! That means that you’re bringing in more than you’re spending.
Keep track of your business expenses in 3 easy steps
Open a bank account for business and open a debit card
This can be done with your current bank or with a different bank
Debit cards are usually free when you open a checking account, but your spending limit is based on how much money is in your account
Try to pay for all your business expenses through this business account’s debit card or checks.
Deposit sales revenue in your business checking account
**Keep track of your monthly bank statements for your debit and credit cards. Now you have a record of how much you earned and spent all in one place!
If you plan to collect cash payments, we especially recommend opening a business bank account. Banks typically allow you to make daily deposits, to minimize the risk of having high cash amounts in store. They also provide “change” free of charge.