As a business, there are many tools at your disposal that can help you and your company grow. One invaluable resource that many beginner brands often overlook is a business bank account. Having a business bank account can help you out as a small business in a few key ways.
Whether you’re a budding business, or you want to take your company to the next level, you’ve come to the right place. Here’s everything you need to know about opening a business bank account and why you should. Read up on these 6 reasons to see why a business bank account might be just the thing for your small brand!
Automates your bookkeeping
As a business, you need to make sure your finances and bookkeeping are kept in order. Whether your business is big or small, bookkeeping can be stressful and tricky to do. With the right business bank account, you can automate your bookkeeping and organize your finances easier. To find the right bank account, there are so many options to choose from depending on your brand’s size, budget, and line of work. Keeping all your business transactions, spending, and cash flow in one place is key. It can help you keep track of your finances and run your business better.
Helps you with your taxes
Apart from simple bookkeeping, businesses have a lot of stress to deal with surrounding their taxes. Doing your taxes the right way and on time is crucial, and having the right business bank account can help. A business bank account helps you gather and prepare your tax information on time and easier. Since your account is linked to your spending and transactions, you’ll have all the information you need in one place. You’ll be able to clearly see what you spent on your business to help you calculate your taxes the right way.
Gets you better credit
As a small business, chances are, you’re going to need to take out a loan or credit to fund your business. With an established business bank account, you can build a relationship with creditors that offer you a better credit. Whether you want to expand your brand, hire new employees, or invest in new equipment, you’ll need good credit. Investors will look at your business credit when deciding to loan you the money. Having a business bank account with good credit will open many doors and opportunities for you in the future.
Helps you apply for government loans
Another useful tool for many startups today is taking advantage of government loans. As with regular creditors, the government needs to be assured that you’re a viable and reliable candidate for a loan. A business bank account can organize your finances, and showcase you as a good candidate. If you want support from the government, you’re going to have to present a showcase of your business's cash flow. To have the best shot of getting a loan, consider organizing your funds with a business bank account.
Protects you from debt liability
Running a business is expensive, and if you fail to pay back your loans, you risk the consequences. If you’re not established as a corporation or a limited liability company (LLC), your creditor can come after you legally. You can avoid this by opening a business bank account and establishing yourself as a corporation. This protects you and your personal assets from debt liability. With a business bank account, you can also mix your personal and business assets, without fear of losing everything you own.
Establishes your brand
Using a business bank account not only helps you financially as a small business but can help establish you as a brand. The public is fickle and may look down on you if you continue to use your personal funds to pay for business expenses. Setting up and using a business bank account can lend credibility to your brand and make you look more professional to clients. Clients will consider you a well-established brand and will be more open to working with you. This will positively affect your company and reputation down the line, so it’s worth a shot!
So there you have it! With this guide in mind, it’s easy to see why having a business bank account is so important for your small brand. A business bank account keeps your finances organized, adds credibility to your brand, and opens up doors for you. For starters, a business bank account automates your bookkeeping and makes tax season a breeze.
It can help you gain access to better credit from investors, and government loans. Last but not least, a business bank account can keep you safe from debt liability and can help establish you as a brand. Keep this guide in mind and consider opening up a dedicated bank account for your budding business!
