As you begin your Profit First journey, one of the setup steps you must take is creating new bank accounts. The Profit First system requires you to have a dedicated bank account where you deposit your profits, as well as separate accounts for your company savings and your operating expenses. But not just any bank will work: As you begin your Profit First journey, it’s important to find a bank that does not charge minimum balance fees on checking or savings accounts.
Finding a Bank That Works for You
That can be easier said than done—but here are some steps we recommend.
- Check with your existing bank. Assuming you already have a bank that you like, let them know you wish to set up some additional accounts—but before you do so, ask about minimum balance fees. If the bank does not have minimum balance fees, then your job is mostly done. All you have to do is explain to your bank what you’re looking to do—it’s always good to make them aware that you may sometimes have zero-dollar balances in certain accounts—and then set up the five Profit Frist accounts: Income, Profit, Owner Comp, Tax, and OpEx.
- Ask if your current bank can waive its fees. If your existing bank does charge minimum balance fees, take a minute to explain to them what you’re doing, and ask if they can help your business by waiving these fees. Sometimes, banks will prove willing to do this in order to keep your business.
- Look for a new bank. If you have to search for a new bank or credit union, it’s usually best to look for a smaller community one—simply because these banks are less likely to charge minimum balance fees. Once you find a bank that accommodates, set up your initial accounts. If you’re limited in the accounts you can set up at the beginning, start with Income, Owner’s Comp, and OpEx. You can always add the rest later. You can also ask your new banker to help you transfer over your accounts in the simplest, smoothest way possible.
Working with a Profit First Coach
Of course, setting up these accounts is just the beginning. From there, it’s important to know how to use them, and when and why to transfer money between these accounts. That’s something your Profit First professional can help you with.
Contractor in Charge has certified Profit First coaches who can guide you through this entire process and show you how to make your home service trade into a true money-maker. Contact us today to set up a free Profit First consultation.