Opening A Business Bank Account

Opening a business bank account is a part of having a business identity.

A business bank account is needed because you need to keep your business finances separate from your personal finances.

It’s not like you have a choice anyway, the Internal Revenue Service requires you to. You may find some free business checking, but it isn’t as common for business as it is for personal accounts. Though you probably won’t earn interest in your business checking account, it can help you establish credit for your business down the road.

Your local credit union may also offer business accounts, sometimes at a lower rate than commercial banks do. In some states you may need to be a member in that credit union to be eligible for a business bank account, while in others you only have to be a resident in the state where the credit union is located.

Whatever your choice, you need to compare the fees to make sure you are getting the best deal. The prices can vary greatly and you should check as many as possible to get a good feel for the going rate.

While you’re comparing these financial institutions, don’t forget to include the cost of checks and other miscellaneous costs in your comparison. Some banks may offer a low introductory fee or no fees at all, only to rip you off you with a ridiculous fee for your first set of checks, so pay attention to those details.

For comparison purposes, you may want to check out Deluxe Business Checks. I’ve ordered from them in the past without incident. They have a large selection for the business owner to choose from and are worth a look.

Some other banking items to consider

It may be a good idea to establish a savings account for your business. This allows you to earn interest on accumulated funds that you may need at a later date to pay bills with. This would include estimated taxes and other less frequent bills.

Once you’ve established a working relationship with your bank, you may also want to apply for a credit card in your business name. A business credit card can help when you’re short on funds and suddenly need equipment or inventory.

Aim to build a relationship with your banker over time. They can be a real valuable source to contact in the event your need to borrow money to grow your business down the road. As with just about any endeavor in life, you can never have too many sources to lean on when you have questions or need help.