“Bank Statements Talk!!”
Jan 31, 2019
Building Profits that LAST! ™
"Bank Statements TALK!!"
A lot of people are not aware that your bank statements actually say a lot about you! You may be thinking “nobody sees my bank Statements”. Well that's not true... and what they see will shock you!
When you go to get a loan for a car, or a home, or a business loan, or something like that, the lenders ask for certain documents.
For employees, it's most likely your W-2 and tax returns. But for entrepreneurs and self-employed applicants, lenders request a DEPTH of documentation, one of them being bank statements!
This usually means lenders want, at the very least, the last bank statement of the year to tie it out with the financial statements that are required. Here's what most entrepreneurs don't know...and three things you can do NOW to set yourself up to win.
- Month-end Statments: It is important that, at some point, you have separate personal and business bank accounts. Your business account works BEST if it has a month-end statement period cut-off. Look at your last statement and see:
- Does the ending date is dated the last day of the month?
- If not, ask your banker to change the statements to month-end. This usually takes a few cycles, so it may be too late for this 12/31/2017.
- If you are opening a new business account, ensure the banker sets the month-end cut-off to the last day of the month. Many banks today don't even ask. Let's say you open the account on the 13th, the bank will start the bank account in the 13th and the statement cycle will close on the 13th.
- Anything other than statements that end on the last day of the month, are not an accurate reflection of any given month, because it straddles two different calendar months, including the 12/31/2017 year-end!
- What it say to the lender is, "If this is off, what other cut-off's should I be concerned with". Loans are hard enough without them digging deeper!
- For transitions from one month/year to another, make sure you work with your banker towards getting monthly, and especially the December bank statement, to end on the last day of the month/year.
- $$$$ > You will SAVE money, SAVE everyone time, and GAIN respect.
- $$$$ > You will LOSE money to unnecessary accounting costs and loan fees, or worse yet, LOSE the lender's confidence altogether.
- Bank balances. The lenders will look at, and what most people don't think about, is that the bank statement should show a positive bank balance. While that may be obvious and you're saying "of course I don't want to show a negative bank statement balance at year-end", but what you many not know... is lenders also look at the beginning of that bank statement, too!
- So, for example, it's coming up on December 1st, what can you do?
- If things are tight and you may run negative, transfer or deposit money in BEFORE the beginning of December so the beginning balance is not negative.
- Watch the balance closely all month, and make sure you end the year with a positive balance!
- If you have a "straddle" bank statement date, make sure you maintain a positive balance in both straddle months, especially on December 31st.
- $$$$ > You will again, SAVE money, SAVE everyone time, and GAIN and favor with the lenders.
- $$$$ > You will LOSE money to unnecessary bank fees, add on loan fees AND higher interest rates... projected out FOR YEARS!
- Downloads: Most people have online banking now, a system set up where that transactions are imported into your accounting software. Whether you import or not, I ALWAYS recommend downloading your Bank Statement PDF's.
- Aways download you bank statement PDF's, even if it your online bank portal say you can download them at "any time", or your portal shows a history of statements available at "any time", download them anyway.
- Why? I have seen SO many people who have either had to close their bank accounts at some point because of an embezzlement, change of banks, change of business entities, change of name, lost debit cards, excessive NSF's, account abuse, or dormancy. All too often, those "any time" downloads disappear or portal access closes, leaving entrepreneurs to "PAY to order required or necessary bank statement copies".
- Don't assume banking or financial institutions will grant you free access to your past records. Many have statutes of limitations for record retention. Protect your records and download them anyway. Better safe than sorry!
- Save them to a secure file folder on your device. Make sure you have at least three years of monthly the bank statements for every single account that has business transactions running through them.
- $$$$ > You will SAVE money, SAVE time, and GAIN extra peace of mind.
- $$$$ > You will LOSE money to unnecessary accounting fees, bank reorder fees, LOSE sleep! Not fun!
TAKE ACTION!! >> If you are planning on becoming more profitable and secure lending for major purchases in the near future, most lenders are going to look at three years of current and PRIOR financial documentation... including THOSE bank statements. Don't compromise your future, get my ACTION worksheet now and get it done!
We all know Lucille Ball's famous facial expressions when Ricky says... "Lucy, you got some splainin' to do!" Don't let that be you looking back at your lenders!
Set yourself up for a successful future. You may not see your needs 3 year ahead, but I can! I've worked with entrepreneurs for thirty five years. I've been through all of what it takes for them to navigate their personal live through their business accounts. As an entrepreneur or business owner, many times YOU are the paycheck, and basically the lenders requires both personal and business documentation. I've been doing this long enough to know that these seemingly little things (like the bank statements) start changing the way you think as an entrepreneur and it will push you into that Millionaire Entrepreneur mindset. And, if you are already there, keep you there!
Click the link below and find out how to access to my
Now go out there... Balance, Reconcile, OWN your business, and celebrate your life!
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"Every positive action counts, and when compounded over time... amazing things WILL happen!" Melanie Jean Burke