It can be very difficult at times to keep the various elements of our lives separated. We have parts of our lives that naturally overlap to enhance our lives and other areas where overlaps bring us no benefit. Some things we let bleed over can be detrimental to our lives, families, and work.
It is very important to implement balance in all areas of our lives. Ways to help balance life and work include getting into good habits like exercising, putting limits on our work day, investing in important relationships and developing hobbies or other activities to get our minds off our work.
As a small business owner it is very important to implement a life/work balance in finances as well. Differentiation between the many roles and responsibilities that come with running a business can also be difficult. Developing a system for keeping accurate records of income versus expenses is the first step to best financial practice. The first step in developing such a system is to have a business bank account separate from your personal account. This will be helpful in several ways. It promotes the work/life balance mentioned above bykeeping business out of life and life out of business. Other benefits that stem from this simple first step include:
Simplifying account reconciliation by having all the information needed in one place. Reconciliation can be very time consuming if you have to search through and separate personal and business expenses before you reconcile with the bank.
In the event of an audit complete records of business-related activities, separate from personal expenses, are required. This process is made simple with all information in a specific place from the beginning.
This may seem like a trivial part of your business plan, but this is one step which can prevent a lot of headaches down the road.
I would suggest searching for banks that offer free business checking accounts. One resource to start with is Nerd Wallet Free Business Checking by State. They list free business checking by state. Some banks also offer interest earning checking accounts. It pays to shop around.
I am happy to help with any bookkeeping questions you might have. I enjoy the process and like to see others succeed in their businesses.