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I've created an LLC under my name for my contract work (taxed as a sole proprietorship). Because of this, I'm planning to open a Solo 401k, and due to that I'm planning to pay myself income based on what my LLC makes per year. (Hopefully those contracts will keep rolling in.)

Because I have to pay myself, I'd like to keep my business assets separate from my personal assets. As such, I'm thinking about opening a business bank account - possibly consisting of a checking account, and maybe some other options. (I don't even really know what a business needs, honestly.)

A business bank account must be different than a personal bank account (or else there would be no distinction.) When opening a business bank account for the first time, what traits or options must one look for?

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From my experience, I opened a business account to handle my LLC which owns a rental property. The account process and features were similar to shopping for a personal checking account. There would be fees for falling below a minimum balance, and for wanting a paper statement. In my case, keeping $2000 avoids the fee, and I pull the statements online and save the PDFs. Once open for a certain amount of time, you might be able to get credit extended based on the money that flows through that account. The online access is similar to my personal checking, as is the sending of payments electronically.

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Yes, it's a good idea to have a separate business account for your business because it makes accounting and bookkeeping that much easier. You can open a business checking account and there will be various options for types of accounts and fees. You may or may not want an overdraft account, for example, or a separate business credit card just so you can more easily separate those expenses from your personal cards.

When I started my business, I opened a business checking account and met with my banker every year just to show them how the business was doing and to keep the relationship going. Eventually, when I wanted to establish a business line of credit, it was easier to set up because I they were already familiar with my business, its revenue, and needs for a line of credit.

You can set up a solo 401k with your bank, too, and they'll be very happy to do so, but I recommend shopping around for options. I've found that the dedicated investment firms (Schwab, Fidelity, etc.) tend to have better options, fees, and features for investment accounts. Just because a specific bank handles your checking account doesn't mean you need to use that bank for everything.

Lastly, I use completely different banks for my personal life and for my business. Maybe I'm paranoid, but I just don't want all my finances in the same place for both privacy reasons and to avoid having all my eggs in the same basket. Just something to consider -- I don't really have a completely sane reason for using completely different banks, but it helps me sleep.

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