I’m starting with all the very unsexy stuff if you want to be self-employed and working from home, but it is also the most important stuff. If you get all the basics wrong from the get-go, then you’re going to end up with a hell of a mess. And that’s not a good way to start a business.
I was so gung-ho at becoming my own boss that I neglected to stop for a minute and think things through properly. Thank God for a proper accountant to help me out of my self-imposed mess. Accountants really are worth their weight in gold. Once you find a good one, never let go of them.
Next stop is the business bank account
Once you have your accountant, the next step is to pay a visit to the bank and open a business bank account. This is a must if you don’t want your accountant to develop homicidal tendencies and murder you in your bed.
If you mix business salaries and business expenses with the personal financial comings and goings, then pretty soon, you’re not going to be able to tell whether you’re coming or going. Your grocery bill will be alongside your business invoices. Your petrol receipts will be mingled with your office supplies budget. I’m sure you can immediately see the upcoming migraines forming.
It’s all about appearances
You MUST open a separate bank account for your business and keep all monies completely separate. If possible, also try and get a credit card with a small amount of credit to go along with the bank account.
Business is all about appearances. Whether it’s your personal appearance or the appearance of how you run your business, appearances matter. If you dress like a slob, people will treat you like one. If they see you use your personal bank account for business, they will write you off as an amateur, and you’ll be cut off at the knees before you’ve even had a chance to get started.
But not only that, if you mess up the finances, pretty soon you’ll come to the attention of the tax inspectors who will arrive to audit you. You REALLY don’t need that.
Wise is the best bank for a business account
What bank you choose is obviously entirely up to you. But if you want to accept multiple currencies and have local bank accounts set up in multiple countries, I can’t recommend Wise highly enough. They give you virtual bank account numbers for each country, and the money instantly gets rerouted into your “real bank account.” And by instant, I mean seconds.
You can also get virtual debit card numbers for one-off online purchases and then you can freeze the number to avoid someone stealing the card number. Finally, the fees are so rock-bottom that they are absolutely unbelievable. I’ve worked my way through so many business bank accounts in my self-employed life and each one has had a major problem sooner or later. But with Wise, everything has gone smoothly so far.
If possible, choose an internet-based bank
Internet-based banks are much better, in my experience, because they tend to be a bit more flexible with cool new features. Traditional high-street banks on the other hand, are more conservative in their approach, especially to the internet and those who work on it. My first bank had no clue what PayPal was and how it worked.
So you’ve got your accountant and you’ve got your bank account. What do you need next? That’s right — you need an office or dedicated working space. We’ll look at that next.