Saving money for your business can be a lot like exercise: we know we need to do it more but, most days, it feels impossible to get started. Sure, a comfortable savings “cushion” can carry you through slow months or surprise expenses, but how do you get there with never-ending daily expenses? Here’s something to remember from your Waco community bank: savings aren’t built in a day. When it comes to accumulating your hard-earned dollars, slow and steady wins the race.
Fortunately, TFNB Your Bank for Life is here to help get you started. We are the Waco community bank of choice for small businesses in Central Texas. Our tools — like commercial CDs (Certificate of Deposits), commercial money market accounts, and business savings accounts — make starting your saving habit easier than ever.
Why Should Small Businesses Save Money?
We know the old adage: you have to spend money to make money. And, often, it’s true! But finding ways to put back a few dollars here and there, and resist the temptation to spend, spend, spend, can benefit you in the long-run. Here’s why:
- Money saved now will help ensure that there will be more than enough to cover any unexpected expenses that pop up later, such as sudden increases in rent, loss of a key employee, a seasonal drop-off in sales, or increased payroll tax rates. Just like a personal emergency fund, a business emergency fund will keep you from going into debt when the inevitable surprise comes along.
- Cash flow is critical to long-term success. In fact, 82% of small businesses fail because of cash flow problems. Having cash on-hand in a savings account (to pay a vendor, cover payroll, or repair needed equipment) can safeguard you from becoming part of this startling statistic.
- Savings also help protect against economic downturns like the one we just experienced in 2020. Planning for the possibility of decreased revenue could help you stay afloat when forces out of your control affect operations.
How to Get Started
Now that you understand why you should save, the next question is “how?”. That’s where we come in. Our Waco community bank offers commercial saving solutions made to meet the needs of your small business. While some of these tools may look familiar, our commercial options come with extra bells and whistles you should know about.
Business Savings Account
A business savings account may be the most widely used option for business owners who want to set aside their savings, while maintaining easy access, but are not necessarily worried about earning the highest returns or interest rates.
To open a business savings account at TFNB, we require just $100 and offer unlimited transfers and withdrawals made in person, by mail, or at an Starting your savings journey with a business savings account just makes sense. Its benefits include:
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- Keeping your records clear: With a business savings account, you’ll keep your personal savings separate from your business savings (and cure at least a few of your bookkeeper’s headaches in the process!)
- Protecting savings from being spent: Also, by separating your dedicated savings from your business checking account, you’ll make sure you — or anyone else who has access to your business checking account — doesn’t dip into your next egg.
- Establishing a close working relationship with a Waco community bank: when it comes to banking, having a local team on your side can make a big difference. Our bank prides itself on working with people — not just accounts. Start with the basics at TFNB, so we can help you with SBA loans, lines of credit, or even building your next location down the road.
Commercial Certificate of Deposit (CD)
A commercial CD is a savings tool that has a specific time frame, interest rate, and fixed term. Our TFNB CDs are FDIC insured up to $250,000 per owner or depositor in the association for each ownership category (i.e., individuals, sole proprietorships).
Commercial CDs are an excellent way to save money and earn interest in a safe, low-risk way. You simply deposit cash into the CD with a set term length. At the end of that term, you will receive your original investment plus an additional amount based on how much interest has accrued over time.
(Interest rates vary based on the term length of the product; however, they typically range from 0.40%-0.80%, which is higher than what most savings accounts offer.)
The main advantage of using a Commercial Savings Certificate is that there is no limit on how much you can deposit. On the other hand, your money will be tied up until the maturity date. It’s best to use this tool with funds you’re certain you won’t need to touch during the term length.
Commercial Money Market Account
A commercial money market account is a bank account that offers you high yields and liquidity. Think of it as a checking and savings account rolled into one.
It allows for unlimited deposits and withdrawals, so it’s easy to access money when necessary. You may also opt in for a debit card or checks that will make it easy to use the funds when you need them.
Not all banks offer the same benefits when it comes to commercial money market accounts. At TFNB, our Waco community bank offers a low minimum deposit and a low required minimum balance for greater flexibility. We also have fewer limitations on how you spend your money. (Our minimum deposit of $2,500.00 is one of the lowest in the industry.)
Build Your Business Savings with a Waco Community Bank
Saving money is one of the most important things you can do to ensure your small business thrives, even in uncertain times. So, don’t put it off any longer. Drop by your nearest TFNB location to talk to one of our commercial bankers — you don’t need an appointment. We’ll chat through your financial questions and can open
your next commercial CD, commercial money market account, or business savings account that very same day.
Kickstart those good saving habits. Let TFNB help!
If you have any questions or would like to know more about our banking solutions, contact us at 254-840-2836
