The Business Bank Account....the Results are IN!

Step One

For my first activity, I thought I would explore something that has been bothering me for a while -  Bank fees. The first account – and the easiest for me to tackle - is my business bank account.  I have had a business bank account for many years for my sole-proprietorship, JB Consulting. It is with the TD Bank where I currently have my personal account. It made it easy to transfer money:  I would get my pay cheque, deposit it and then transfer it to personal account. I might make a maximum of 6 transactions per month, usually only two. I originally paid $10.95 per month. It has since gone up to $14.95 per month, or $179.40 per year. 

Just not right!

Fast forward to today and most of my work comes from Cent$ible Students for which we have a separate business account. (More on that another day!) However, I have to keep my JB Consulting account as I still invoice some work through my sole-proprietorship. But, some months I have to actually transfer money from my personal account just to pay the bank fees!

Not happy with this situation, I explored TD to see if they had any other options. The most affordable option was $9.95 for a Pay As You Go account. It would have saved me a little, but still expensive in my opinion as this was the base fee. 

The Search

I decided to research other banks. I explored the FCAC online banking tool but it only looks at personal saving and chequing accounts.

http://www.fcac-acfc.gc.ca/eng/resources/toolcalculator/banking/index-eng.asp.

I discovered a great blog that had already done most of the work for me,  http://www.milliondollarjourney.com but the particular article on business bank accounts was written in 2009 so it was probably needing some updating. (There were some other great articles here that I am sure I will check out again later!)

I finally researched the individual accounts myself. There is a lot of information to shift through and much to consider. Location is important to me, as I need it to be convenient for me to deposit my cheque. Cost is obviously important too.  

 

The Complicated Results….

As I mentioned in my “teaser” entry last Friday, I did close my TD Business account.  When I got out my Master Business Licence to open a new business account I discovered that my JB Consulting Master Business Licence had expired last May! I called and discovered that they give no notification about this (you have to renew every 5 years) and that to renew, I would just have to pay the required $60 and I would be back in business.

This gave me an idea. Since I don’t do much JB Consulting business anymore, I could bill using my own name, NOT pay the $60 to get a new business licence and use a personal account instead! Eureka! I called an accountant friend, Marot Merner  - http://www.margotmerner.com and she agreed, based on my situation, that this would be a good solution! 

The Big Save

So my final conclusion is business banking is expensive. I could not find a truly reasonable account. I was leaning towards the RBC eAccount since I do most of my banking online, and the CIBC Basic Business Operating account was offering 3 months free on their $6.00 per month base account. But both had the potential to cost more than expected if some months required additional transactions.

HOWEVER, there are some great personal banking options including ING Direct Thrive Account and PC Financial. I already had a PC Financial chequing account that I had set up when I was saving for a vacation and had not used since.  I decided that this FREE account would work! It will be my new “business” account to keep my newly named “Jenni Bolton” business separate from my personal account. Problem solved! 

Total savings:  $60 (business licence) +  $179.40 (for the TD Business Account) = 

$ 239.40. 

 I worked hard for that!

Let's hope my next challenge is not as complicated!

It's coming!

I bet you thought, sure, she has given up already! No news. Well, did I ever open up a can of worms! I have so much to tell! I am going to just give you a teaser today. My focus this week was my business bank account. I was tired of fees. I spent the first week researching and the second week stewing on what to do. I did cancel my business bank account though!  (It felt a bit like breaking up!)

I will write more soon. I have to sort a few things out first. Might have to be in two parts. I will report back early next week........please check back then!

My idea of WEEKLY  blog might be too ambitious! This stuff does take TIME!

Happy Friday!

My Year of Living Cent$ibly

Where To Begin?

I am a self-employed facilitator. I have two children, an 11-year old boy and an 8-year old girl. I co-founded Cent$ible Students www.centsiblestudents.ca with Caroline Munshaw to help students learn to save, spend and share. I teach fitness. I manage the money at our house. I have lived in Toronto all of my life. I love a good bargain. I am new to blogging and Twitter.

Personal Challenge - Walk the Talk!

My year of living Cent$ibly is a personal challenge. I talk about financial literacy all the time. I have worked with at-risk youth, newcomers to Canada, students from kindergarten to Grade 8 and even delivered sessions at homeless shelters in Toronto. I have trained others how to deliver the curriculum in my role as a trainer for a wonderful organization called SEDI www.sedi.org and the Canadian Centre for Financial Literacy www.theccfl.ca. I want to make sure I walk the talk!

The Inspiration

I talk and read a lot about money. I am passionate about what I do. Yet there are areas in my life that I would like to improve financially. Why don't I do it? Sometimes it is fear. I want to find a no fee bank account but have so much connected to my current account that I worry I might forget to transfer something over and miss paying a bill. Mostly it is lack of time. I am busy trying to build a business and manage a household. But I wonder things such as, do I have the best rate for my insurance? Do I have the best cell phone plan for my needs? Finding out would take a lot of phone calls and seems like an onerous task.

The Plan

Each week I plan to set a goal and write about it. One week I might examine my cable and Internet contract. Is there a cheaper alternative to my current situation?  Another week I may find a way to save more or share a tip I have discovered. I may also share some of the resources I use in my work, or comment on interesting articles and ideas.

The Potential Outcome - For My Family and Yours

Financial literacy is defined by the National Task Force on Financial Literacy http://www.financialliteracyincanada.com/definition.html as "having the knowledge, skills and confidence to make responsible financial decisions."

I have a lot of knowledge about financial literacy and am always learning more. I hope to apply this knowledge and use my skills to improve my family finances and hopefully gain more confidence about my decisions. 

I hope you will share this journey with me as I apply the lessons and advice I give and receive on a daily basis. I respect that we all have different values and attitudes around money, so your experiences and choices may be different. For me, that is what financial literacy is all about. Making the best choice for your own circumstance, but having the ability and the necessary resources to make decisions that you are comfortable with and confident about.

I hope that with me you can take some time to reflect on your own financial situation and perhaps we can learn together from my personal challenge.  I look forward to hearing your ideas and comments on what you do at your house to manage financially. 

One Final Thing

My mantra is balance. I may not always choose the cheapest alternative. I may eat out more than I want to as my family rushes from activity to activity. (I am a hockey mom!) Sometimes my choices may not be the best for my bottom line, but it is the best for my family - and my sanity! It will be this journey, this introspection, that will help me to find ways to save money and to understand more about the choices I am making. Are they truly the right choices... for me? Are you making the right choices for you? Let's explore this together!