How to pick the best business bank account for your startup
There are a lot of things to do when you start a new business: make your product, find your first customers, keep track of your money, and make sure your marketing is working. But picking the right business bank account is one of the most important things you’ll do early on. It may not seem like a fun job compared to other business tasks, but doing it right now can save you trouble later.
Your business bank account is more than just a place to keep your money; it’s an important tool that will help your business run and grow. It’s where your transactions will be processed, where you’ll keep track of your expenses, and where you’ll eventually keep track of your profits to see how well you’re doing. Choosing the right one can affect everything from how well your business does financially to how quickly you can grow.
So, how do you pick the best bank account for your new business? Let’s talk about the most important things that can help you make your choice and how to choose the best one for you.
Why does your business need its own bank account?
Let’s get to the point: why can’t you just use your personal account for your startup? You could do it, in theory. It’s not only a good idea to keep your business and personal finances separate; in some cases, it’s also the law.
To begin with, mixing your personal and business finances can make things very confusing when it’s time to file your taxes. It can also make it harder to keep track of how well your business is doing and make you more likely to be audited by the IRS. Having a business bank account also makes your company look more trustworthy. It shows customers and partners that you care about your business, which can help them trust you.
Things to think about when picking a business bank account
Now that we’ve talked about how important it is to have a separate business account, let’s look at the things that are most important when choosing one. There are a few things you should look for when choosing the right account for your startup.
1. Account fees: An important factor
Fees are one of the first things you should think about when you choose a business bank account. After all, no one wants to pay high monthly fees or surprise charges that cut into their hard-earned profits. Many banks offer free business checking accounts, but these usually have limits, such as a limit on the number of transactions or restrictions on certain types of deposits.
You should carefully read the fee structure of any account you are thinking about opening.
Search for:
- Fees for maintenance each month: Some accounts charge a monthly fee unless you keep a certain amount of money in them.
- Transaction fees: If your business will be handling a lot of cash deposits or withdrawals, make sure to find out if there are fees for each transaction.
- ATM fees: A lot of banks charge you to use ATMs that aren’t in their network. If your business deals with cash, you need to be able to use ATMs that don’t charge fees.
For instance, you might have an online store. You might need a business bank account that lets you do a lot of transactions and charges less for credit card payments and wire transfers. To avoid surprises, make sure you know these things ahead of time.
2. Tools for online and mobile banking
You need to be able to manage your business finances on the go in today’s fast-paced world. Find a bank that has strong online and mobile banking tools. These can help you keep track of your money, make payments, and move money quickly and safely.
For example, some banks have tools that automatically sort your expenses into categories to make it easier to keep track of your money. Some of them come with built-in connections to well-known accounting programs like QuickBooks or Xero. These integrations can save you hours of work, making it easier and faster to manage your money.
Mobile banking apps are a game-changer for business owners who travel a lot or work from home. You can deposit checks by taking a picture, keep an eye on your account in real time, and even move money between different accounts with these apps.
3. Help and support for customers
As the owner of a startup, you will probably need help right away at some point, whether it’s with a technical problem, a question about your fees, or a problem with a transaction. For a smooth banking experience, it’s important to have access to customer service that is quick and knowledgeable.
Think about how well the bank helps its customers before you open a business bank account. Do they have a help line that is open all the time? Are there special support agents for business customers? Can you get help by chatting online, calling, or going to a local branch? When you need help quickly, these things can make a big difference.
When making your decision, think about how some smaller, online-only banks may not have the same personal touch as traditional banks. A local community bank or credit union might be a better choice for you if you want to be able to talk to someone in person about your problems.
4. Getting loans and credit lines
There may come a time when your startup needs a loan or line of credit to help it grow or pay for day-to-day costs. Many business owners don’t think about this when they choose a bank account for their business, but the truth is that your bank could help you get money.
Some banks offer special business loan programs that make it easier for you to get money in the future. If you think you’ll need financial help as your business grows, you might want to choose a bank that offers good support for business loans, lines of credit, and credit cards.
5. Simple to connect with other services
Your banking needs will probably change as your business grows. Your bank should be able to work with other tools you use to run your business, like payroll management, tax filing, and paying vendors.
For instance, if you use Gusto for payroll, make sure your bank can work with it without any problems. This will help you save time and make fewer mistakes when you process payroll. Also, think about how the account will grow over time. What features will your business need in a year or two?
You can relax knowing that you won’t have to deal with multiple accounts or services to get the job done if your bank offers these integrations.
The point is: Begin with what’s best for you
In the end, the best business bank account for your startup is the one that meets your needs the best. Think about things like fees, online banking options, customer service, and the ability to get more money in the future. Pick a bank that can grow with your business and that fits with your long-term plans.
Don’t rush into a decision; take your time looking at all your options. Also, don’t be afraid to ask other business owners for advice or recommendations. The right business bank account can help you build a successful company by giving you the tools and resources you need.
You won’t have to switch accounts later if you make a smart choice now. And as your business grows, you’ll have the help you need to stay focused on what’s important: serving your customers and building your brand.