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What is the need of creating a corporate bank account? It gives you multiple advantages to keep your business finance separate from personal accounts. This way you can learn the art of money management and making balances on both fronts. A mix up of two types just leads to a complete financial mess. Furthermore, opening corporate bank accounts is an obligation as per IRS (Internal Revenue Service) rules are concerned.
In this regard, free business checking is an inevitable mention. Till date, it is not a common option as one can see for personal account checking. However, many entrepreneurs are switching to free checking to avoid charges required for this purpose. There are lots who are yet to get a clear picture of corporate accounts. They may be disheartened to know that such accounts do not yield interest. But you will be better off with corporate bank accounts because these will establish your business creditworthiness.
Now the brass talk is how to set up a corporate account and what about the fees. Let us consider these dual factors:
How to set up a corporate account?
Both commercial banks and credit unions offer corporate accounts. But credit union offers it at much lower rate. There are some states which have not made it mandatory to be a member of a particular organization in order to set up corporate bank accounts. The only requirement is you must reside in the state where the credit union has got the charter.
For your home-based business purpose, you may also open a savings account. You will earn interest on the fund and may use it to meet your bills. If you have a good tie-up with your corporate banking partner, it will facilitate in getting a credit card in your business name. Needless to say, business credit card is a great help when you run short of money and need some immediate cash for necessary buys.
How much to pay for opening corporate accounts?
You must want your corporate bank accounts to come on pocket-comfortable rate. My suggestion is – never jump at any offer, rather do some market research. Also take into account the cost of endorsement stamps and checking as well to compare the offers on more inclusive factors. The reality is some banks charge very moderate fees but have a whole block of hidden charges for the first set of checking or endorsement stamps. So, always keep your eyes open so that you do not end up shelling out penny unnecessarily.
As you extend your relationship with your business banker you’ll have a source to contact in the event your need to borrow money to run or grow your business. Business bankers may also offer other valuable services, such as credit card and payment processing for your small business.
Owning a small business can be very fulfilling, but there is a lot of hard work involved. Most, if not all, of your life is devoted to the running and expansion of your company. Opening a small business checking account may not entirely eliminate the time you spend managing your company’s expenses, but it will sure help you save some.
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