Choosing the right bank can often be what results in a small business being successful or not. Without the right bank, a small business is not going to have the confidence that it needs to make smart choices with the money that it does have coming in and will therefore end up less profitable and perhaps fail. Here are some tips for commercial banking in order to get the most out of it and to be as successful as possible.
1. Utilize a Sweep Account
A sweep account is actually a pair of accounts. One account is like a normal checking account. The other is a special, interest-gathering account or market mutual fund. The way that this pair of accounts works is that you set a limit for the amount of money that you want to have in your checking account and you let the bank know this limit. Then, every time you get deposits from clients and customers that is above the limit of the checking account, you have access to all of that money until the end of the banking day. Then, any excess money over that limit that does not get used is swept into the market mutual or interest-gathering account in order to make sure that your money is working for you without you having to do anything special. This is important because it allows you to make more money based on the money that you have.
2. Have Your Personal Account at the Same Bank As Your Commercial Account
You also want to make sure that you have your personal account with the same bank that you have your commercial account. This is extremely important because it will allow you to stay organized, view both of your accounts in a single online banking page, and easily make transfers between one account and the other. For example, if you need to transfer some of your own money to your commercial account in order to complete payroll for the month because your client is not due to pay you until after the two-week period, you can do this with minimal or no fees.
3. Use Linked Accounts to Accommodate Higher Sums Without Fees
During certain times of the year, you might have a higher balance in your account than normal. You might not have an account that is able to handle this amount without triggering your bank to start piling on fees. To avoid this, consider using linked accounts that are all connected. This allows the accounts to detect if one of them is about to hit a threshold that would result in fees. It can avoid it by pushing some of the money to another connected account automatically.
For more information, talk to a company that specializes in commercial banking, or visit websites like http://www.crossplainsbank.com.
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