If you’ve been dreaming about starting your own small business, you’ll have a lot of planning to do. One of the clerical decisions that you’ll need to make is how your business will pay bills. Here are a few things that small businesses (and their owners) need to pay their bills.
Open a Bank Account
First, you’ll want to open a bank account designated specifically for your business. This bank account will be used to manage your business finances. You can collect your business income in this account and also track expenses, including the cost of paying bills.
Having a business bank account can also help you to have a healthy balance between your business finances and expenses and your personal finances and expenses. Blending the lines between those two can cause you to lose more personal money than necessary.
Get a Credit Card
Next, you’ll want to apply for and obtain a credit card dedicated specifically to your business. Make sure to research different credit card options to find the one with cash-back features, savings, and benefits that will help your business. You can pay your bills with your credit card to show consistent payments in your history. Having a credit card for your business can help you to grow a great credit score.
This will help you when you’re making large purchases for your business, such as renting a storefront, since you’ll need a good credit score to prove your financial stability. When you’re trying to boost your credit score, make sure that you keep up with payments consistently. Payment history makes up 35% of your score.
Use Online Software
One of the common issues that small businesses encounter when paying their bills is the inconvenience of paper bills. Often, you’ll have a huge pile of bills that have been building up over time, and some deadlines might slip through the cracks. Even when you have paid the paper bills, it might take some time for the mailed payment to be received and posted. You don’t want to be penalized for late payments when the mailing process takes longer than expected. So, going paperless and using online software to pay your bills can eliminate a lot of these issues. Many online bill payment services can help you pay your bills easily and on time without worrying about missing piled-up bills or mailing them out too late. Just remember to save any online documents in a designated electronic folder.
So, if you’re starting a small business and wondering how to manage your business finances, remember that paying your bills is one of the most important parts of owning a business. You’ll need to open a bank account, get a credit card, and use online software to facilitate your bill payments. This will help you to manage your business bills and expenses with greater ease.
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