Welcome to our new series: Best Practices in Accounting and Finance!
Through this series we will be answering some of the biggest questions small business owners have as well as giving tips and advice on being a smart business owner regarding bookkeeping. We take the hassle of bookkeeping away from small businesses. This way, you can focus on income producing activities.
The one burning question we always get: How many business bank accounts and credit card accounts should a business have??
The answer is: One. If you have a lot of money in your checking account, a savings account might be a good idea. You can earn interest if you move some of the funds over to a savings account. And just one, at the most two, credit card accounts. American Express offers a lot of good services for small businesses. We recommend getting an AmEx card, and maybe a Visa or Mastercard. And that’s it!
The reason we recommend one bank account is because: the more accounts you have, the more reconciliations you must do every month. In addition, if you have multiple bank accounts your cash is being spread unnecessarily. Often, that means that your average balance in each account is too low to receive free services from your bank. The same goes for Credit Card accounts: the more accounts, the more you must reconcile each month.
If you have further questions, please reach out to us through our contact page. We are here for you!
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