Is One Business Bank Account Enough?

By Fournier ABS | September 7, 2022

The short answer is yes, it can be. I work with many solopreneurs who have only one business bank account and it works well for them. However, if you struggle to maintain an adequate balance in that account, or to pay yourself, your employees, or your taxes then opening another account or two may be the answer.

Additional Business Bank Accounts to Consider

Let’s break down the various bank accounts and how you might use them to have better control over your business finances.

Operating Account (Main Checking Account)

This would be the account you already have, the one that your income is deposited into, and that you pay your expenses out of. This is the account that has the most activity and does most of the heavy financial lifting in your business.


Savings Account(s)

Just like with your personal finances, many businesses can benefit from having a business savings account. Moving money that isn’t needed RIGHT NOW into a savings account can help you from overspending and ensure that there are adequate funds for larger or unexpected expenses later on down the road. Your savings account can have a variety of purposes.

  • Saving for Taxes

You’ll want to save for taxes, both quarterly and at year-end. No one likes getting a large tax bill at the end of the year. But it is even worse if you don’t have the money available to pay for it. Saving a portion of your profit every month and paying your quarterly taxes from these savings can make Tax Day a lot less stressful. Not sure how much to save? Check with your tax preparer/CPA to see what they recommend.

  • Saving for Replacements/Upgrades/Improvements

Do you know you are going to need to replace a large piece of equipment in the next year? Are you planning a big brand refresh? Will you need to invest in a larger amount of inventory for the upcoming holiday or another busy season? Use a savings account to help cover these future expenses by saving a piece of every sale in the months prior to incurring the expense. This way you won’t be scrambling to figure out how you are going to pay that big invoice.

  • Saving Prepaid Contract Funds

Do you have customers or clients that pay you ahead of time for future work? Maybe you provide monthly services, and they pay you for 6 months all at once. Or, maybe they contract you for a large project and pay you more than the required initial payment. Use the savings account so you don’t spend the money that will be needed at a later date.

You may choose to have one large Savings account that covers all these categories or open an account for each one of these scenarios. Whether you have one savings account or multiple savings accounts, each comes with its own pros and cons; deciding what is right for you and your business will mean evaluating the pros and cons of both. And remember, the more bank accounts you have, the more accounts you need to reconcile and maintain.

Other Accounts (Optional)

There are a few other accounts that may make sense depending on your type of business and the size. Some of these could be:

  • Payroll Account

This type of account would be a checking account that you transfer funds into from your operating account to cover your payroll. This would be the account from which your payroll provider pulls the wages and taxes every payday. Having a separate payroll account will ensure that you can always cover payroll, as long as you keep it funded.

  • Business Credit Card

Having a business credit card can be beneficial. However, a Business Credit Card comes with all the same advantages and pitfalls as a personal credit card. Making sure you can manage the credit and not become overextended will be key.

  • Owner Profit Account

Much like the savings accounts described above, this is an account into which you would transfer a percentage of your monthly profit, and then on a quarterly basis, you would pay yourself 50% of what was in this account. This is in addition to however you pay yourself on a weekly, biweekly, or monthly basis for your own living expenses.


Having Multiple Bank Accounts Isn’t For Everyone

Every business is different, as is every business owner. If having only an operating account works for you and your business, then great, stick with that. But if it isn’t working, then consider opening another or a few more accounts with specific purposes. The key to successful money management and a profitable business is having a system that works for you and helps keep your money in your hands.


Need Help Managing Your Business Finances?

Need assistance with organizing your accounts or getting a better handle on your business finances? We work with solopreneurs and small business owners all over the U.S. to have peace of mind and confidence in their numbers. Set up a free consultation today!

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