Why Doesn’t Profit First Work for Everyone? - Ep 172

Business can be overwhelming, so why not keep your banking simple? In this episode, Danielle Hayden answers these common questions from business owners: How many bank accounts should I have for my business, and how much cash should be in each? She shares Kickstart Accounting Inc.'s proven cash management strategies for optimizing your banking setup. You'll learn how much to have in your tax reserve or rainy day fund, our favorite banks and account options, and how often we recommend clients review and contribute to each account.

Find out which actionable steps you can take right now to improve your cash management!

 

Key Takeaways:

• Kickstart Accounting Inc.'s cash management method is a great alternative to the profit-first method, requiring just three bank accounts and less maintenance.

• Utilize savings accounts for taxes and a rainy-day fund to ensure your business is prepared for unexpected expenses and tax liabilities.

• Strategically allocate funds to select accounts based on your business's current season, balancing between growth and sustainability.

• Keeping personal and business accounts separate is crucial for accurate financial tracking and avoiding tax complications.

• A bookkeeper can help you determine the right amounts for each account.

 

Topics Discussed:

How to simplify business banking and cash management (1:03)

The three essential business accounts (1:42)

How often to contribute to each account (6:39)

The best banks and account types (7:31)

How to leverage high-yield savings accounts (8:05)

Proper use of personal savings accounts for business owners (9:45)

This week's homework: first steps to managing cash in your business (10:41)

 

Resources:

Listen to episode 115: Entrepreneurs: Should You Go S-Corp? Pros & Cons + Expert Insight -https://kickstartaccountinginc.com/entrepreneurs-should-you-go-s-corp-pros-cons-expert-insight-ep-115/

 

Listen to this bonus episode:

S Corp Owners: How to Calculate Your Payroll as a Business Owner and Stay IRS Compliant -
 https://kickstartaccountinginc.com/s-corp-owners-how-to-calculate-your-payroll-as-a-business-owner-and-stay-irs-compliant/

Recommended Banks:

Chase

Mercury

American Express

Flourish (High Yield Savings)

Capital One

 

Connect with Kickstart Accounting Inc.:

Instagram | https://www.instagram.com/Kickstartaccounting

YouTube |  https://www.youtube.com/@businessbythebooks

Facebook | https://www.facebook.com/kickstartaccountinginc