From the course: QuickBooks Online: Best Practices to Unlock Business Growth

Banking best practices - QuickBooks Online Tutorial

From the course: QuickBooks Online: Best Practices to Unlock Business Growth

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Banking best practices

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When I sit in meetings with other business owners and the topic of banking comes up, I feel anxiety, confusion and sometimes anger in the room. How to develop banking relationships isn't taught in school. As a former banker, I would like to demystify banking so that this area of your business, your banking relationship, is set up for success. Banking relationships are important, but it is a balancing act between efficiency and necessity. After this lesson, you'll be able to implement strategies to keep your banking relationships simple and easy to manage. Have the funds you need to weather a storm and understand how setting up your bank accounts will help you achieve your goals. Here are three banking practices that will set you up to maximize your business's success. Most businesses only need two or at most three bank accounts. Actually, one account is enough. If you're concerned about security, one account for payroll and to pay bills and another to receive cash will provide all the security you need. To sustain your business through lean times, keep 4 to 6 months of cash in your bank accounts to cover expenses. If your fixed expenses are $80,000 a month, then your cash availability should be $320,000. This may seem unattainable, but I've seen businesses build the funds they need through careful planning using a budget. Next, consider the banks you work with. Here are some attributes of a good commercial bank. Easy online access for copies of checks and deposits. They answer the phone they're willing to lend to you, and they work well with QuickBooks. I can't recommend anyone bank since they differ so greatly by location. Start by exploring banks that other small businesses in your area recommend. Now that you know what a bank should provide. Evaluate your bank with the key attributes to see if your bank is adequate. If not, start asking your fellow business owners where they bank and how they like the service they get. Take some time to review the bank accounts you have open and whether each one serves a measurable purpose. You may be able to simplify your finances and save time and hassle.

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