Posted on: 13 January 2020
When you're launching a new business, you need to address a lot of details. One of the key considerations is opening your company's bank accounts. It's important that your business has a separate business checking account to keep your business transactions separate from your personal ones. However, what you may not realize is that a business savings account can be just as beneficial. Here are a few of the reasons why you should open a savings account for your business at the same time.
Tax Payment Tracking
One of the best things about creating a savings account for your business is that it provides you with a dedicated account that you can use for your tax payments. Since business and employer tax payments are made quarterly, you'll want to be sure that the money earmarked for those tax payments won't accidentally be spent for another expense. When your monthly tax liability is transferred into a savings account, it can sit securely there until such time as you need the funds to make your tax payments every quarter.
Most individuals recognize the importance of having an emergency savings account to address significant, unexpected expenses. Whether the furnace goes out or your hot water tank bursts, you'll need to cover those costs right away.
Opening up a savings account for your business provides you with somewhere to save some of your company's profits on an ongoing basis so that your company has money to fall back on in the face of an emergency, significant capital expenditure, or other major costs.
When you choose a savings account that is interest-generating, that provides you with a passive income source for your business. You will earn interest on that money every month, and that interest will be recorded as additional revenue for your business. The more money you can keep in your savings account, the more interest you will earn on a monthly basis.
The interest rate will vary from one account to another, so take some time to explore your account options before you choose one. The higher the interest rate you can get, the more money you will generate in interest.
As you can see, there are many reasons to open up a savings account for your company. Talk with your bank representative today to find out what kinds of commercial savings accounts they offer so that you can find the right business savings account for your needs.
To learn more about business savings accounts, contact a bank.Share