Michel Valbrun, CPA, CEO of Wealth Warriors, and financial editor for ADLANTA Magazine, says freelancers and independent contractors should open a business banking account and pay themselves a salary from that account as if it were another business expense.
"This is an absolute must for any freelancer or entrepreneur. Not only does it make it easier to manage your money, it saves you (or your CPA) a lot of time during tax season," Valbrun said. "Also, mixing your personal and business accounts can put you at risk of losing your limited liability protection."
Valbrun says to use financial tracking software like QuickBooks to track everything that comes in and out of the account. He also recommends separate savings accounts or "buckets" for different aspects of the business.
"The less access you to your funds, the harder it is for you to spend," he said. "I recommend creating multiple saving buckets for common expenses such as marketing, administrative costs, and education."