Can You Start a Business Without a Bank Account or Credit Card?

If you’re a young entrepreneur, you’re likely still figuring out how to manage money and business, and maybe you don’t even have a bank account yet. While running a cash-only business is possible, it comes with some big challenges. This article breaks down the difficulties of running a business without a bank account, why having one is the better choice, and how to open an account with an adult’s help. 

Why Running a Business Without a Bank Account Is Harder 

Here are a few reasons why a cash-only business can be hard to run. 

1. Handling Cash is Risky and Inconvenient 

If your business only accepts cash, you’re bound to run into some issues. For starters, many customers prefer paying with cards or digital options like PayPal, which could limit your sales. Keeping track of your income will also be tougher since there won’t be digital records of your transactions. Plus, if your cash gets lost or stolen, there’s a good chance you won’t be able to recover it.  

2. Emergency Expenses Can Be a Problem 

Running a business comes with unexpected expenses, whether it’s restocking supplies or replacing broken equipment. If you’re only dealing with cash, covering these costs can be tricky. Without a bank account or credit card, you’ll have to rely on whatever cash you have on hand, which isn’t always enough when you need it. 

3. Paying Taxes Is More Complicated 

Even as a small business owner, you’re still required to report your income for taxes in the United States. Having a bank account makes this process much easier by helping you track expenses and prove your earnings. It’s also worth noting that the IRS may be more likely to audit cash-only businesses since they tend to have a higher risk of underreported income. 

4. No Protection If Something Goes Wrong 

One of the best things about having a bank account is that your money is protected by FDIC insurance for up to $250,000. That means if the bank ever shuts down, the FDIC steps in to make sure you get your money back. But if you’re keeping all your cash at home and it gets lost or stolen, there’s no way to recover it. 

Why a Bank Account is the Better Choice 

A bank account and credit card help with day-to-day transactions, and they also set you up for bigger opportunities down the road. Here are some of the perks of having a bank account as an entrepreneur: 

• If you’re selling online, you’ll need one to get paid. Platforms like Shopify require a bank account to withdraw earnings, so without one, your money is stuck. 

• It keeps your money safe and organized. A bank account protects your earnings, helps you track spending, and creates a digital record of your income. 

• Credit can help your business grow. Many small businesses rely on credit to get started. Using a credit card responsibly now can help you qualify for better interest rates, business loans, and even office space in the future. 

Starting with a bank account and responsible credit use gives you more financial options and makes running a business much smoother. 

How to Open a Bank Account as a Young Entrepreneur 

If you’re under 18, a parent or guardian can assist you in opening up a bank account. Many banks offer teen checking accounts, but they usually require an adult to be listed on the account with you. To open one, you’ll need: 

• A government-issued ID (passport, driver’s permit, or school ID) 

• A parent or guardian’s name (if the bank requires it) 

• Your Social Security number (SSN) or ITIN 

• An initial deposit (some banks require at least $25–$50) 

Managing credit comes with serious responsibility. If you’re not ready for a credit card of your own, you can ask your parents about becoming an authorized user on their account. This strategy allows you to build some credit without being completely responsible for the payments. 

Start Today 

Running a business without a bank account is possible, but it comes with greater risks. Setting up an account with a parent or guardian is a straightforward process and makes it much easier to receive payments, track expenses, and start building credit. Taking this small step now can lay the groundwork for long-term financial success. 

 
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