Short answer: Yes.
Long answer: If you’re serious about business, even if you’re just starting and not making money, separating your finances isn’t optional. It’s essential. YES!
TIP: You need an LLC and an EIN number in order to set up business banking and credit cards. Learn how to quickly do that here: CLICK HERE
Why You Need a Business Bank Account (Even as a Broke Solpreneur)
Too many new entrepreneurs make the mistake of running business expenses through their personal checking account. That’s like trying to run a marathon in flip-flops. It technically works… until it doesn’t.
✅ Clean Accounting
Tax time becomes a nightmare when you’re combing through Uber Eats charges trying to figure out if that $42 dinner was a client meeting or a date. A separate business account = clean records. Your accountant will thank you. (Or you’ll thank yourself when DIYing with QuickBooks or a spreadsheet.)
✅ Write-Offs Without the Red Flags
Mixing personal and business expenses is one of the biggest red flags if you’re ever audited. A clean business account protects your deductions and shows the IRS you’re legit. If the transaction is on the business account / business credit card, that means it is a business expense. Easy peasy.
✅ Easier Tax Filing & Bookkeeping
Whether you’re filing a Schedule C or running an S-Corp with payroll, separating your funds makes tracking income and expenses nearly plug-and-play.
✅ Qualify for Loans, Lines, and Grants
Most banks, lenders, and SBA programs require you to have a dedicated business account to be eligible. You can’t build real credit or apply for a business line of credit without it.
What About Business Credit?
Business credit is your company’s financial reputation. Just like a personal credit score, your business has one too—but it’s separate from your FICO score. That means:
📈 You Can Build Credit Without Risking Your Personal Score
Miss a payment on your business card? That won’t touch your personal credit—as long as you’re not personally guaranteeing the loan (more on that later).
🏦 Access to Business Lines of Credit
With a strong business credit profile, banks will extend working capital to cover inventory, marketing, payroll, or emergencies. That can keep your business alive during a cash crunch.
📉 You Can Avoid High-Interest Personal Debt
Why put $15,000 on a personal credit card when you can finance it through a 0% intro APR business card or low-interest business line?
📊 Business Credit Can Help You Scale Faster
More purchasing power = faster growth, especially if you’re investing in ads, equipment, or inventory.
Tax Benefits: The Underrated Superpower
Business accounts and credit cards open the door to dozens of tax strategies:
- Separate card = separate records = more deductions, fewer mistakes
- Track purchases automatically for things like subscriptions, supplies, client meals
- Use your business card for 100% deductible expenses, like software, mileage, education, meals, computers, etc.
And when your accountant can easily separate your spending? They can save you even more money at tax time.
What About SBA Resources and Disaster Loans?
To apply for Small Business Administration (SBA) loans—including disaster relief funds—you must have a business entity and a business bank account. If your business was impacted by COVID, weather events, or economic downturns, that account is your gateway to federal support.
Best Business Banks and Cards for New Entrepreneurs
Here are some proven winners:
💳 Chase
- 2% cashback business credit cards
- Popular among startups
- Longstanding SBA lender
- Massive support for online banking and integrations
💳 Amex
- Industry leader in points/rewards
- High initial limits for new businesses
- Great for high-spending entrepreneurs
💳 Capital One
- Simple, transparent rewards programs
- Flat-rate cashback cards
- Great mobile tools for tracking and categorizing spending
💳 Huntington Bank
- Midwest favorite with strong SBA ties
- Known for easy account setup and personalized small business support
- Local feel, national reach
Final Word: Don’t Mix the Two
You want your business to grow, but you also want to protect your personal finances. Opening a business account and credit line is one of the easiest and smartest moves you can make—even before you make your first dollar.
ACTION CHECKLIST
✅ Open a business checking account (start with Chase, Huntington, or Capital One)
✅ Apply for a business credit card (look at Amex Blue Business Plus or Chase Ink)
✅ Keep every business expense off your personal accounts
✅ Track all spending (use Wave, QuickBooks, or your bank’s free tools)
✅ Build your business credit profile with on-time payments and consistent use
✅ Keep your personal FICO score protected by not co-mingling funds
✅ Prepare for future funding, tax prep, and growth with clean books from day one
Bottom Line:
Start like a real business, and the world will treat you like one. Set up that account. Open that credit line. Get legit.
