Small-business owners should split one checking account into 3-10 savings accounts for taxes, payroll, and other obligations. Each week, move a portion of revenue into these buckets so your tax account grows and you can pay estimated taxes on time instead of panicking on April 15.
We'll have a main operating account, which is your checking account, and then we'll have anywhere from 3 to 10 savings accounts. And don't freak out, it's okay. Once a week, we make allocations and transfers into those savings accounts based off of top-line revenue. We're having you work out of your operating account and ignoring the money that we've put into the other accounts. And the other accounts are things like income tax. If we put away that tax money up front, you can always make your estimated tax payments, and there's no panic at April 15th. Then the IRS becomes your best friend, and they're not a good friend to have. It's a complete mindset shift and making sure that you are thinking ahead, and we teach you to plan ahead so that you're getting the most value out of every dollar of your money, because every dollar has a job, and we want to make sure that those jobs are being fulfilled correctly and timely and to the best of our ability.
