The 3 Bank Accounts Every Business Needs
Still winging it with one business bank account?
Most small business owners were never taught how to organize their money in a way that supports growth. In this post, we’re breaking down a simple 3-bank-account system designed to give entrepreneurs clarity, confidence, and better cash flow control. Whether you’re preparing for taxes or trying to stay organized, this approach can help you scale without the cash flow chaos!
#1 Operating Account
This is the account that your day-to-day transactions come in and out of. Customer payments, vendor bills, payroll, etc., all need to come in and out of your operating bank account. Find a bank you love and have a great relationship with, that supports the business and most importantly doesn’t nickel and dime you for monthly account fees or features you need to make running your business easy. Don’t have a great bank? Check out Relay.
#2 Tax Account
This account is specifically to save money for taxes!!! Something every entrepreneur and business hates but is often times the biggest expense of a business. Use this bank account to stash cash away every month, so when you need to make your quarterly estimated tax payments, you have cash specifically set aside and earmarked for those tax payments.
#3 Savings Account
Every single business needs a savings account and needs to know what their target amount of cash should be at any point in their business based on their business size and operating model. Having a savings account with the appropriate amount of cash can be the life saver your business needs to weather unexpected events or enable you to say yes to an unplanned opportunity that is advantageous.
Pro Tip: Set both your Tax account and Savings account up as a High Yield Savings. Many banks offer these High Yield Savings accounts. I particularly recommend choosing a bank that does not charge any monthly fees or have a minimum balance requirement. If you need a High Yield bank account recommendation, our current go to is Live Oak.