6 Key Reasons to Get a Business Bank Account Now!
Oct 11, 2024
Starting an assisted living business is exciting, but there's one thing you shouldn't forget: setting up a business bank account. It might seem like a small detail, but it's super important for your success. Let's talk about why you need one and how to set it up.
Why You Need a Business Bank Account
When you're running a business, keeping your money separate from your personal cash is crucial. A business bank account helps you do just that. It makes you look more professional and helps you manage your money better. Plus, it can also protect you from problems down the road.
Let's dive into the six big reasons why setting up a business bank account is a smart move for your assisted living facility.
Check out the video, too:
1. Look More Professional
Having a business bank account makes your assisted living facility look more serious and trustworthy. When you pay bills or cash checks, it's all in your business name. This looks way better to the people you work with, like the families of your residents or the companies that sell you supplies.
2. Keep Your Money Organized
Mixing your personal money with your business money can get messy fast. A business account keeps everything separate and easy to track. This is super helpful when you're trying to figure out how much your business is making or spending. It's also a lifesaver when tax time comes around!
3. Protect Your Identity
When you use a business account, you're using your business tax ID instead of your personal Social Security number. This helps keep your personal information safe. It's like building a wall between your business and personal life, which can protect you if something goes wrong with the business.
4. Make Taxes Easier
Tax time can be stressful, but a business account can make it much easier. All your business transactions are in one place, which makes reporting your income and expenses a breeze. If you ever get audited, you'll have all your business finances neatly organized and ready to go.
5. It's a Must for Partnerships
If you're running your assisted living facility with a partner, you definitely need a business account. It keeps things fair and clear between you and your partners. Plus, in some cases, it's actually required by law!
6. Makes Selling Your Business Easier
You might not be thinking about selling your business now, but if you ever do, having a business account will make it much simpler. It shows potential buyers a clear picture of your finances, which can make your business more attractive to them.
How to Set Up a Business Bank Account
Setting up a business bank account isn't as hard as you might think. Here are the basic steps:
- Choose a bank that works for your business needs.
- Gather your business documents (like your business license and tax ID).
- Visit the bank or apply online.
- Decide what type of account you need (checking, savings, or both).
- Make your initial deposit.
Remember, different banks might have slightly different requirements, so it's a good idea to call ahead and ask what you need to bring.
Wrapping It Up
Getting a business bank account is a smart move for your assisted living facility. It keeps your finances organized, makes you look more professional, and can even protect you from headaches down the road.
Ready to take your assisted living business to the next level? We've got two great resources for you:
- Download our free Business Plan Checklist. It'll help you make sure you've got all your bases covered as you start writing your business plan.
-
Need help figuring out where to start? Join the next Roadmap Challenge and build your launch plan with me.
Remember, setting up a business bank account is just one step on your journey to success in the assisted living business. But it's an important one that can set you up for smoother sailing ahead.
Happy investing!
Show full transcript 👇
Transcript
00:00:00
hi everybody i'm brandon gustafson i own and operate two assisted living facilities and i created this channel to help people like you learn the ins and outs of investing in assisted living welcome to assisted living investing [Music] welcome back to assisted living investing uh just quick recap on our last video we talked about why you should promote from within with your uh with your staff and why it's important to do that so go ahead and watch that video i'll link it up here in a card
00:00:41
for you to to go and watch that video today we're going to get into six reasons why you need to have a business bank account why it's important to have that business bank account uh six reasons so number one is business accounts are they just look more professional it looks better to have that that perfect bank account there it makes you look a little bit more professional it's easier to set up contracts with vendors you know we we have like a milk vendor for one of our facilities and so it's
00:01:12
just a little bit easier it looks a little more professional we're doing that if you have a housekeeper or or something like that uh a maintenance company they're able to invoice the company they're not invoicing you you can pay it out of your bank account so checks come with the name of your facility on there so it's just going to look a little bit more professional it's also going to help your residents and their families feel a little bit more comfortable that you're running a
00:01:36
legitimate business not that they don't think that you're a legitimate business i mean you're providing them with these services but um having that bank account so that they are paying it direct directly to the name of your facility and things like that um you know it just makes it feel a little bit more natural a little bit more professional which is great that's what you're you're looking for number two is um it keeps your finances separate so having a separate bank account for your
00:02:08
business is just going to keep them separate from your personal finances if you have multiple businesses it's going to keep it separate from from that which is just going to make it a whole lot easier when it comes to tax time it's just a little bit more straightforward it just it keeps things organized it's really helpful when you have it there to keep your finances separate and having a separate bank account is going to be the best way for you to do that three is a business account can help
00:02:36
protect your identity so the account that you create is going to be in the business's name it's going to use the business tax id the ein the business tin are some of the other ones tin are some of the phrases you might hear as people are asking about business tax ids um ein tin attend those types of things but your business bank account is going to use that number rather than your personal social security number and so it's going to be tied to a separate entity it's not going to be tied to you
00:03:09
it just kind of gives you that extra layer of protection protects your identity helps protect you from personal fraud those types of things it doesn't mean that you couldn't have business fraud something could hack into your your business bank account and things like that but it keeps it separate from you it helps protect your identity which is extremely important you want to make sure that you are are kind of protected from that and shielded from it because you don't want to have your business turn into something that
00:03:38
you know somebody drains all of your personal funds or something like that it just it's a good idea to keep it there um for that personal identity protection number four is it's going to simplify your tax preparation so all of your transactions are going to be in this separate bank account so it's much easier to prepare your taxes separate accounts also make it a lot easier in the event that there's going to be an audit um so it just kind of keeps it clean it's all in one account it sits
00:04:05
there somebody comes and you know the irs wants to audit you you just have bank records for that single account it's just going to make it a lot easier and more streamlined there from a tax perspective as well which is which is great we all want to have simplified um tax situations to we want to make sure that that is running smoothly as as much as we can number five is business accounts are necessary um when you're in a partnership so if you're doing this as a sole proprietor if you're just going out and doing this by
00:04:37
yourself then i mean you could conceivably set up your own account in your own name but if you're partnering with somebody you're working on a bigger deal you're you're doing different types of of you know you're just doing a partnership you're you're setting up an llc you're you're working as an entity and those types of things it's going to be required that you have that business bank account so entities are legally they're looked at as being separate from their owners and
00:05:03
so it's necessary to have a bank account for them and you also probably don't want to give your personal banking information to a business partner anyways um i i mean even me working with my dad i wouldn't necessarily want to give him my login and use my personal bank account and he wouldn't want to do the same thing for me despite us being you know family and things like that just you never know what's gonna happen you you hope that that people don't um steal or or do those types of things but
00:05:35
it happens and so you just want to be aware of that and so having this separate bank account that is set aside specifically for the business is also going to protect you from that type of a fraud or just funds going missing or something like that it just makes it a lot easier to track and just be aware of everything that's going on there and then number six is a business account is going to make it a lot easier for you to sell your business down the line um so a lot of you are probably getting into this
00:06:05
thinking oh this is what i'm going to do it's my long-term hold i really want to be in assisted living 15 20 years down the line 30 years down the line when you're trying to pass it off to your your children and they don't want it anymore having that separate bank account is is going to make it a lot more simple for you to then sell the business it makes it a lot easier to review bank statements if you need it and there's also kind of the the potential to transition the bank account
00:06:33
over to a new owner if you're doing like a full sell of the business including all assets including cash that's going to kind of come with the the bank account i don't claim to know exactly what that process looks like and how it works but i know that it's a possibility and so having a separate bank account with those assets there is just going to make that a much more streamlined process and so that's another reason why you want to do that next time in our next video we're going
00:07:01
to be getting into how do i set up a business bank account so we've been talking about the six reasons why um you should have a business bank account next time i'll put a card up here we'll get into how do you set up that business bank account what's that process like what can you expect as you're going through it how does it differ from setting up your personal account and those types of things and then in closing to learn more about investing in assisted living make sure you visit me on
00:07:25
assistedlivinginvesting.net i have other content out there free resources working on setting up a a way for us to do kind of some consulting calls and have some conversations with me and help you through the process and and follow me on my other social media platforms i would love to see you over there and just remember it doesn't take a lot just a little bit keep making progress step by step by step you're going to be able to do this you if you just keep making progress you will be successful
00:07:54
thanks for watching and have a great day [Music] you
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