![]() ![]() If you are, consider a fixed term, fixed interest rate Business Term Depositģ.Starting in December, TD Bank ( TD) savings account customers who exceed six transactions in a billing cycle will pay a $9 fee each time they take money out of their account. If you do, consider a standard variable interest rate savings account that lets you withdraw funds whenever you need them Will I need immediate access to my funds? ![]() There are three key factors to consider when choosing a business savings account:ġ. What type of savings account should I choose for my business? Saving with this in mind allows you to plan for situations such as predictable seasonal cash flow gaps. Having easy access to cash can help your business through those times when money isn’t coming in as regularly. Plan ahead for future projects and seasonal lulls Of course, if you build up your savings enough, while benefitting from compound interest, you may not need to borrow. It shows you have the discipline to regularly save money. Having a history of putting money aside weekly, fortnightly or monthly can help when you need to apply for a business loan, overdraft or credit card 1. Have a visible savings record to help get credit With most savings accounts you can access the money quickly when you need it. This is good news if you have an unexpected expense or see something you want to buy that will help you manage or grow your business. With funds built up in a savings account, you can see the scale of your cash reserves. As is the case with personal savings accounts, it’s good to know you have money set aside to help cope with what life – or business conditions – might throw at you. Getting into the habit of saving regularly could help avoid this. Running out of cash is one of the main reasons small businesses fail. ![]() Term deposits generally earn a higher rate of interest than standard savings accounts. If you’re prepared to lock your money away for a longer period, it could be worth shopping-around for a business term deposit 1 that matches your needs. Therefore, moving surplus income into a savings account could be beneficial – even if it’s just for short periods – particularly if there are no fees for making those movements. Interest rates on savings accounts vary, but they will generally be better than those offered by transaction accounts. If you subscribe to Westpac online banking 1 you can view your transaction and savings account balances alongside each other, and moving cash between accounts can be done 24/7 2. Putting money aside into a savings account could help you keep a closer eye on your day-to-day spending, and any areas for potential reduction may be easier to identify. You can find out more about these obligations on the Australian Tax Office website:Ī transaction account generally gets used to pay suppliers and take payments. With all those transactions coming in and out, monitoring and managing expenditure alone can be difficult. Putting a percentage of your income to one side in a savings account could help avoid the stress of ensuring you have funds available to fulfil your obligations, including any GST you owe. The next it’s Business Activity Statement (BAS) time and you have to declare and potentially be taxed on your income. One day your bank balance could be looking very healthy. Here are six reasons why a savings account 1 could be a good idea for this and other purposes: 1. Some businesses choose to have more than one account to help manage different aspects of their operation, such as tax payments. When setting up in business it can be important to separate personal finances from company money – so you may wish to consider having at least one business transaction account.Ī separate business bank account 1 makes tracking income and expenditure easier, simplifies life at tax time, and could save you time when reconciling. How many bank accounts do I actually need? ![]()
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