Five Great Online Banks for Freelancers & the Self-Employed
Freelancers need banking solutions that are just as smart and savvy as they are. We need quick transfers, insightful data, and least of all fees. These online banks for freelancers make mastering the art of money easy, fun, and sensible.
Do I need a business bank account as a freelancer?
There are some situations where you could use your personal account, but we don’t recommend it. If your business is incorporated (LLC) you MUST have a separate bank account. Sole proprietors could use their personal account, but you may want to give yourself a kick in the pants later. You will be better prepared for tax season and new business growth with a business bank account. Many are easy to start and complete fee-free. Our recommendation: Get the account. Keep personal and business accounts separate always.
Benefits of Starting a Business Bank Account
The only tools worth having are the ones that make your life easier. An online bank account tailored for freelancers gives you the autonomy and power to control cash in and out of your business. Here’s why an online bank account is completely worth it:
- Boundaries: As CEO and founder of your business, the line between personal and professional can quickly get blurred. Finances, in particular, should be kept separate and tracked carefully. Resist the temptation to swipe your business debit card for a Target run or a new outfit.
- Functionality: A business bank account provides you with financial data that a personal account cannot. You can track cash flow and revenue, manage transfers, and create savings accounts all tailored to your business.
- Tax Season: Sweat less during tax time. As a freelancer with a dedicated bank account that has carefully tracked all of your income and expenses, you can handle taxes with ease. Some online banks allow you to grant access to your accountant without sharing login information. This can make tax time much less stressful.
- Benefits: Depending on the bank you may find different incentives that appeal to your business. There are cash back options, savings accounts, mobile deposits, and more that will help you run a successful business.
What to Look for in an Online Bank
There are many great options for online banks. A great online bank not only looks good on paper, but provides you with the functionality you need to run your business.
Just like with credit cards, there are banks out there with some fees. When you operate as a solo or small business, cutting unnecessary overhead costs is paramount. What really doesn’t work for freelancers is banks with minimum deposits and/or monthly fees. (Looking at you Chase) If you have a small or inconsistent monthly income, these banks are not for you. And always read the fine print. Many perks come only under certain circumstances that your small business may not be able to achieve.
You also want a bank that’s friendly with the other apps and software you use to run your business. Look for a bank that integrates with the things you use: Shopify/Paypal/Stripe, as well as your accounting software.. A well-integrated bank will make the financial management of your business so much easier.
Five Great Online Banks for Freelancers & the Self-Employed
Novo
Tops the list with no hidden fees or balance minimums. The application process is quick and easy, plus they have a human-powered customer service team. Money transfers are wicked fast. Novo integrates well with numerous platforms out there like Shopify, Etsy, Amazon, Stripe, Square, and WooCommerce to name a few. Not to mention they refund all ATM fees (my personal account doesn’t even do that!)
Favorite low-key awesome feature: Set up to five “Reserves” that pull a dedicated % amount aside from each deposit. This makes saving for tax season and new equipment a no-brainer.
Lili
Lili’s mission speaks to our soul: We remove hurdles and support our customers’ freedom, so they can do their thing. Their straightforward approach to banking makes everything from invoicing to tracking expenses as easy as swiping left or right. Lili is a no-fees, no minimum balance bank that even offers automatic savings with 1.00% APY. Lili does a fantastic job of making banking stress-free and dare we say…fun?!
Biggest perk: Lili’s cash back program partners with vendors that you already use for your business (like MailChimp and Microsoft) and deposits the cash directly into your account.
NorthOne doesn’t just look classy, they offer first-class features for freelancers and the self-employed. You can easily manage your money, classify transactions, and budget from anywhere. Plus, you can send AND receive payment with just a few clicks on their mobile app.
Stand out feature: Expert budgeting assistance. You can customize your budget to smartly put aside money for rent, taxes, or payroll automatically.
Bluevine
If you need lending support, Bluevine is for you. Here you can apply to start a line of credit for your business. Not sure if you need a credit card? Learn if that’s the right move for you here. They offer checking, lending, and bill pay services that can help you streamline your finances. And you better believe that Bluevine checks all our other must-have boxes: no monthly fees, no minimum balances, and unlimited transactions.
The sugar on top: Bluevine checking accounts are eligible to earn 1.5% interest if you meet at least one of the following requirements:
- Receive or deposit $2,500 of your clients’ payments into your account via ACH, wire transfer, mobile deposit, or transfer from your payment processing provider.
- Spend $500 in a calendar month with your Bluevine Business Debit Mastercard®.
Oxygen
Hooray for no monthly fees and unlimited fee-free transactions! Oxygen is well-matched for small-business owners who are looking for a cost-effective way to separate their personal and business finances. You can manage everything on-the-go with the Oxygen app. If you’re looking for opportunities to cash in on more benefits (but with the caveat that you’ll pay an annual fee), you can check out Oxygen’s tiered loyalty program here. You will land great benefits like cashback for your regular coffee runs and more!
Biggest perk: You can start with the Oxygen personal account if you have not yet set up an LLC. From there you can follow the steps and get support for forming an LLC for your business.
Tips for managing your finances as a freelancer
Freelancing comes with a bucket full of benefits, but you do have to be more responsible and more aware of how you run your business. Mismanaging finances can lead to cash shortages, low-earning months, and heavy doses of stress. Set your freelance business up for success by building good habits early on.
- Start with a budget
- Keep personal and professional expenses separate
- Save for rainy days
- Set aside money for taxes
- Find affordable health insurance
- Check in with your bank account and accounting systems weekly
These online banks for freelancers are fantastic tools for becoming the financial master for your business. You will be able to improve your profits by carefully planning and managing your finances. From there your growth and potential are unlimited.
Need more help setting up your freelancing business?
Start here:
