Choosing the Right Bank Account for your Wrestling Club
Choosing the right bank account for your small business is a crucial step in managing your wrestling clubs finances well. The right account can help you streamline your financial operations, save on fees, and access essential banking services while saving you time. In this tutorial, we’ll walk you through the key considerations and steps to select the best bank account for your wrestling club.
Understand Your Business Needs: Before you start comparing bank accounts, it’s essential to understand your business’s unique financial requirements. Consider the following factors:
a. Business Type: Different types of businesses have different banking needs. For example, non-profit might have different banking needs for multiple people having access that a single member LLC Wrestling Club does not need.
b. Transaction Volume: Evaluate how many transactions (deposits, withdrawals, and transfers) your business conducts on a monthly basis as this can determine if you want a business checking or savings account. Your fees may also vary based on transaction volume.
c. Cash Flow: Consider your business’s cash flow and whether you need a savings account or a checking account, or both. Some savings account’s limit your withdrawals to 6 per month, or you must pay a fee to access additional withdrawals.
d. Financial Goals: Determine your short-term and long-term financial goals, such as saving for expansion, managing cash reserves, or handling payroll.
Compare Different Account Types: Banks offer various types of business accounts. The most common ones include:
a. Business Checking Account: Ideal for daily transactions, paying bills, and managing cash flow.
b. Business Savings Account: Helps you save and earn interest on excess funds while keeping them accessible.
c. Merchant Services Account: Necessary if your business accepts credit card payments. Although not necessary if you process payments with WrestlingIQ
d. Business Line of Credit: A credit account that can help you manage short-term cash flow gaps, typical for businesses that have large up front expenses to complete a job. If your club runs tournaments or camps, a line of credit may be helpful to manage the gap between payments posting and expenses for the venue, referees, etc.
e. Business Credit Card: Provides a revolving line of credit and can help with expense tracking. Most major banks offer business credit cards, they can be helpful for building credit for the business as well as giving your club a short term line of credit for expenses such as gear purchases. You can also earn and redeem points.
Research Different Banks:
Once you have a clear understanding of your business needs and the type of account you require, research different banks and financial institutions. Consider the following factors:
a. Fees and Charges: Compare account fees, transaction charges, and any minimum balance requirements.Currently many business checking accounts require you to hold a minimum balance of around $1,500 or pay a monthly service fee of $10-$20.
b. Location: Evaluate the bank’s physical locations, ATMs, and online banking options.This is sometimes overlooked. A covenant location to make deposits and withdrawals can sometimes save you hours a month in travel for your club.
c. Account Features: Look for features like mobile banking, remote deposit, and integrations with accounting software. Chase Bank has one of the most robust mobile banking applications and the majority of your business can be managed off site.
d. Customer Service: Consider the bank’s reputation for customer service and support.
Read the Fine Print: Before committing to a bank account, carefully review the account agreement and terms and conditions. Pay attention to:
a. Fees and Penalties: Understand the charges for overdrafts, wire transfers, and other services.
b. Interest Rates: If you’re opening a savings account, check the interest rates offered.
c. Account Restrictions: Ensure you’re aware of any limitations on transactions or withdrawal limits.
Ask for Recommendations: Seek recommendations from fellow business owners, accountants, or financial advisors who can provide insights into banks that cater to businesses similar to yours.
Open the Account:
Once you’ve chosen the right bank and account type, visit the bank or apply online to open the account. You’ll typically need to provide essential business documents, such as your EIN (Employer Identification Number) or Social Security number, business formation documents, and personal identification. Opening a business bank account can take anywhere from 1-2.5 hours in person at a bank. Make sure you allocate enough time for this and go in with all the documents you need to complete it in a single visit. If you have multiple members in your LLC, both must be present to open the account and complete the necessary forms.
Monitor and Review: After opening your business bank account, actively monitor your transactions, track expenses, and periodically review your account to ensure it continues to meet your business’s needs.
Non-Profit Club Tip – If you are opening a business bank account for your 501c3 organization, make sure to have the proper checks and balances in place for signatory and check writing. Make sure your treasurer is set up as a signatory on the account.
We recommend JP Morgan Chase’s business accounts and the suite of different accounts they offer: https://www.chase.com/business/banking/checking
Conclusion: Make your primary decision based on what is going to make it easy to manage your day to day operations for the business. Examples of things that might be are red flag for a bad fit – a hard to get to location for you, your treasurer, or a partner. A lack of online banking services. High fees and high account balance minimums often don’t make sense for smaller clubs.Jeffrey Marsh with first draft ai assisted