Freelancing can be a rewarding experience. Controlling your hours and schedule and having more freedom with the type of work you do each day can be life-changing. But your finances can look quite different when transitioning to this type of work. It’s wise to set yourself up for success early on to run your small business effectively.
Having a business bank account can make it easier to handle your financial affairs. Many top banks offer plentiful business banking products for businesses of all sizes. Here are a few reasons to consider using business banking products if you’re a freelancer.
1. Easily see where your business finances stand
A separate business checking account can allow you to understand your cash flow better. You’ll see recent transactions and your account balance without subtracting personal expenses. Knowing where your financials stand will make it easier to make important business decisions.
2. Have organized financial records for tax season
Your tax situation changes when you become a freelancer. Since you no longer have an employer deducting taxes from your paychecks, you’ll be responsible for making quarterly estimated tax payments as your freelance business brings in income.
It can also be helpful to keep track of your business expenses for tax purposes when you’re a small business owner because eligible business expenses may qualify for tax deductions.
Having a dedicated business bank account can simplify tax season. You’ll have clear and organized records of your business finances all in one place, and you may find tax season much less overwhelming once you separate your personal and business financial affairs.
Having business banking products can also save you money on software and tools. This is especially helpful if you’re a new freelancer growing your business. You may lack extra funds to spend on business software solutions like small business accounting software.
How can business bank accounts save you money on these expenses? When your business finances are well organized, handling your invoicing and accounting needs will be easier.
Additionally, many business banking apps include built-in tools that can help you manage your money better, which could eliminate the need for pricey software.
4. You may be taken more seriously
Using business banking accounts can also make you appear more professional. Unfortunately, some prospects may be wary of working with a new business if they don’t appear established.
If you’re a new freelancer establishing yourself, how potential clients perceive you matters. Using business banking products can make your business look more legitimate. It can also illustrate that you take your small business seriously and are invested in its success.
5. Save yourself time and feel less stress
Time is money, and a less stressful life is more enjoyable. Separating your personal finances and business finances can simplify your life. You may feel less stressed because you don’t have to waste precious time sorting through various charges in your bank accounts to determine which are business-related expenses and which are personal bills.
Explore business banking solutions
Even a solopreneur can benefit from using business banking products. You’re a business owner, after all. Whether you’re already freelancing or just getting started, take some time to explore business banking solutions so you can manage your company’s finances with ease.
In addition to business bank accounts, business credit cards can be worthwhile. You can earn rewards on your spending and get value from the benefits included with your credit cards. Review our list of the best business credit cards to learn more.
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