If you’ve been putting off separating your business and personal finances, this one’s for you. It’s TIME, girl. Past time, actually. 😉 It doesn’t matter if you’re on day 1 of business or day 5000, it’s time to treat your business like a REAL business and simplify your life. So many creatives put this off far too long due to fears, insecurities and sometimes just plain laziness. We all do it with one thing or another, friend, but this is not one of those things worth waiting on. I’m gonna let you in on just a few of the reasons you need to get a separate bank account for your business today.
You’ll save precious time and energy
If you don’t have a separate bank account for your business, every expense you’ve had in your business has been paid for by a personal card. Every month (or heaven forbid every April 14), you have to go through all your charges and document your business expenses in a separate spot. This takes lots of time, time that would be better spent on just about anything else in building your business!
Now imagine you have a separate account for your business, which means you have a separate credit or debit card for your business. All the expenses you incur for your business will be paid for with your business card, so you won’t overspend without realizing it. This also means you won’t be using business money to pay for personal things. At the end of the month, you can just log into your business account and quickly see your balance.
You’ll have clarity as to what you’re actually making.
Honesty moment. Do you actually take the time on a regular basis to go through your expenses and record what you’ve been spending on your business? If not, I get it. It’s boring. Overwhelming. It takes time calculating, entering into spreadsheets, and sifting through purchases trying to remember what they were and whether they were for your business or not.
If you are taking the time to track, do you ever find yourself spending personal money on your business without realizing it until you sit down to do your spreadsheets and tracking? It’s easy to do when you don’t have a clear picture of your funds! Separating your accounts gives you waaaay more clarity on what you’re spending on your business (and equally as important, in your personal life!). It will allow you to know where your business stands financially with just a quick glance. You need to make sure your perspective is accurate, because 100% of your business money is not actually yours!
You’ll be able to confidently pay yourself.
Separating your bank accounts allows you to finally treat your business like your employer. You wouldn’t work for a company where the CEO’s personal funds were mingled in the same account as the business funds. It doesn’t make any sense. There are employees that need to be paid, clear business expenses, etc. It’s time to start thinking of your business in the same way.
If you don’t already, it’s time to start paying yourself regularly. If your finances aren’t separated, you have no way of knowing what your pay should be. Maybe you don’t think your business is making enough to pay yourself yet. But how would you know? If you don’t have clarity on what money is business money, you have no way of knowing how much is available for your salary. After separating your accounts, you’ll be able to start paying yourself regularly!
Taxes will get easier!
Tax season can feel like the worrrrst thing ever. It’s exponentially harder if your finances aren’t separated. I’m here to tell you, taxes don’t have to be that hard if you take care of it throughout the year! I think you get the point by now, but a separate bank account allows you to take a quick look at your statements for the year and total up your expenses and income. I highly highly recommend doing this at minimum once a month, but I suggest once a week! Taxes simplified! 😉
Pro Tip: Once you’ve separated your personal and business finances, I then highly recommend having multiple business accounts to clarify your business finances even more. I recommend having the following accounts to start: General Business Checking, Tax Savings and Salary Savings.
Your quick win for the day? Start a separate bank account for your business and keep those monies separate! 🙂
I'm Val! Coach for creatives like you who are ready to be healthier, happier and more empowered women who love the business you run, the people you serve and the life you live!
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