Don't make it personal

Setting up a business banking account separate from your personal account may save you hours of productivity for other tasks. It will allow you to not only track your purchases without having to figure out if it is a personal or business expense but it will also allow you to establish a relationship with your business banker which could come in handy when your business is ready to grow and begin asking for financial assistance. There are a few points to consider when choosing the bank for your account:

• Do you prefer a local bank or a national chain? A local bank will provide more personalized service and chances are greater that you will have direct interaction with the bank president. On the other hand, if your business requires that you travel outside of your local area, you may want to consider a chain because you will be able to get assistance in a wider area.
• Do you want to integrate your accounting software with your account? Some banks only integrate with certain software programs. If you chose your software first then you want to make sure your bank is compatible with that program.
• Do you want merchant services available through your bank? Some banks offer merchant services through a third party, however, using their preferred company may allow you instant access to your funds or 24 hour access. Using an outside merchant processor may be cheaper (we will go into more detail in a later article) but there may be a delay in getting the funds transferred to your account.
• Do you want to process your payroll through the bank? You may have a different system for processing payroll but some banks offer free checking for your employees if the bank is managing your payroll which not only includes paying your employees but also paying your employee taxes.
• How many transactions will you have each month? You must consider how frequently you will be making deposits (daily, weekly, merchant service transactions) and withdrawals (payroll, vendors, bills).
  

Most banks offer different levels of business banking accounts depending upon the amount of transactions that you anticipate and the amount of money you plan to leave in the account. When you are ready to open your account, most bankers will require the following documents (always call the bank first to double-check):

• A copy of your letter from the IRS listing your EIN (employer identification number)
• A copy of your business license
• A deposit to fund the account
• A driver's license (or other government issued identification)
• A partnership agreement if you are a partnership or a copy of your articles of incorporation if you are a corporation
  

All parties wanting access to the account should be present when the account is open. Mind your business and keep your personal and business banking separate!