Best Business Savings Accounts

Business savings accounts and money market accounts are designed to separate your capital from everyday transactions, helping you to manage and grow your savings. Many banks offer introductory interest rates that can boost your savings for up to six months or more, and most accounts are protected by the FDIC for up to $250,000. To help you find the best home for your company's cash, WalletHub’s editors compared more than 370 small business checking and savings accounts. We identified the best offers for businesses overall as well as those with the highest interest rates, best rewards, lowest fees and more.

1. Best Business Savings Accounts 2017
2. Chase Business Savings Account
3. Best Business Savings Accounts For Small Business

Saving for a rainy day is a phrase we are accustomed to hearing when it comes to our own personal finances, but not one we would think about when it comes to business.

But business savings accounts help many companies and sole traders weather difficult financial times. It’s clear that there are benefits to having a business savings account, but which is the best company savings accounts to opt for?

Why might a business want a savings account?

There are many reasons why it makes sense for a business to have a pot of savings:

• Buffer income volatility – whether you are a limited company or a sole trader, every business is subject to ever-changing trading conditions. The most recent issue many businesses have faced is the coronavirus pandemic. Even with Government help, many businesses found trading conditions so difficult that they become insolvent. Whilst a savings pot may not stave off such large trading threats, it will and can go some way in helping a business survive difficult conditions. It also means that if sales are slow and income is affected, a business sales account can provide a welcome buffer.
• Buffer unexpected costs – overheads do not remain the same, and if they rise unexpectedly, a savings pot could help buffer these unexpected costs.
• Ring fence money for tax and VAT liabilities – ringfencing money to pay upcoming tax and VAT bills is easier with a savings account. By using accounting software, you can automatically calculate the size of both or either of these bills and put this money aside. It also means that as you save this money, you accrue interest, a welcome added bonus.

What are the different options for business savings accounts?

There are different business savings accounts that a startup can easily use to give their business a stable financial foundation.

Like all savings pots, there are different issues that you need to consider. By doing so, you’ll find the business savings vehicles that your business needs:

• Accessing your money – some business savings accounts are built for long term returns which means getting access to your money is not instant. Other saving pots do have instant access, but the pay off is a lower return.
• Interest rates – any money that your business puts aside needs to work hard, and that comes in the way of interest. Longer terms savings vehicles have a higher interest rate as do some business savings accounts that are deemed ‘riskier’. Other business savings accounts that have instant access will have a lower interest rate.

Understanding which is the best instant access, fixed interest rate or higher interest rates business savings account for your business is essential.

Current business saving accounts

The interest rates and products on offer can change without notice. Always check the current business savings rates and products on offer from each bank before you commit

A business savings account can really help a business to build a stable financial base. It allows surplus income to be saved and earn you interest at the same time. But like all business accounts, you need to make sure you choose the right product for your business, including how quickly you can access the money.

Business savings accounts FAQ

Yes, in fact, from a financial planning point of view, a business savings account is a great way of ringfencing money as well as earning extra income too. There is a huge range of savings vehicles for business from high-interest business savings accounts to fixed-term products that can yield a high-interest rate, but limits access to your money.

A business that has a savings account affords itself extra protection against a range of financial issues such as managing dips in income, as well as putting aside sums of cash to meet tax and VAT liabilities. Company savings accounts also allow a business to put aside surplus cash and earn money through interest payments. It gives an extra sense of security that should there be a rainy day for the business to endure, that there is a pot of cash to draw on.
There is no doubt that a business savings account is part of prudent financial planning for any business, no matter their shape or size.

Best Business Savings Accounts 2017

Savings operate in a similar way for businesses as they do for personal customers. The amount a business saves depends on a variety of factors:
• Leave a buffer in the current account – a business should maintain an operating buffer in their current account so that overheads and bills are met from month to month. This is especially important if you place savings into a fixed term, no access savings vehicle.
• Meet current debt obligations – it is important that a business not only keep a buffer in their current account but are able to easily meet their overheads and bill payments.
But, as a small business, you can put away the money that you need to meet tax or VAT liabilities.
If you use a piece of accounting software, such as Xero or QuickBooks, it can automatically calculate how much your tax and/or VAT liability will be. This means you can move this amount to a savings account. You’ll just need to make sure that you can access the money when you need to in order to pay your liability.
In other words, a business shouldn’t place itself into financial difficulties in order to save but can be used to save the amount you will need to pay in tax or VAT every quarter or annually.

Chase Business Savings Account

Best Business Savings Accounts For Small Business

A high-interest business savings account will yield a higher return, and this can be maximised in a number of ways:
• The amount you save
• The length of time you save it for
• Whether it is an instant access or notice account
The best business deposit accounts are ones that are fixed term. But what this means is that the money you place into the savings account is locked away for a period of time. This could be for 6 months or as long as 5 years.
Banks change interest rates too, and so there may be times when interest rates significantly increase, just as there are times when interest rates can be low.