Lili Bank Review – Banking for Freelancers
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Lili is a great banking option for independent contractors, freelancers, and new small business owners.
8/10
Cost
9/10
Ease of use
9/10
Services
8/10
Features
8/10
Being a freelancer is tough. (I’ve been doing it for over a decade now.) It’s a constant struggle to get enough work to live on and juggling multiple deadlines simultaneously. But once you get the hang of it, the benefits are worth it.
There’s just one thing I wish I could change about freelance life: taxes. Freelancers are required to jump through hoops when it comes to paying taxes. Because we’re all 1099 workers, we must decide how much of our hard-earned money goes back to Uncle Sam. So, when I heard about Lili’s Tax Bucket feature, I downloaded the app and opened an account.
Here’s how life as a Lili customer is working out so far.
Jump To
What is Lili?
In 2018, Lilac Bar David and Liran Zelkha decided to create an online banking solution designed for freelancers and small business owners. (Think: early direct deposit, an optional tax bucket, and fee-free cash withdrawals.) After the group raised $25 million, Lili was born.
Lili is a free, mobile-based banking app — available for iOS and Android devices — that offers tax planning and budgeting tools to help freelancers and independent contractors manage their finances.
Better banking is here.
- No account fees
- Earn up to 4.50% APY
- Up to 2-day-early-paycheck
- No-fee Overdraft Coverage.
- Do it all in one app.
- Up to $2M of additional FDIC insurance through a network of participating banks.
How does Lili work?
Let’s start with the basics. Lili isn’t a bank; it’s a mobile banking app. Choice Financial Group provides Lili’s banking services, and deposits on all accounts are insured up to $250,000 by the Federal Deposit Insurance Corp.
Opening a new account with Lili is easy. You’ll need to download the mobile app, but you can also use Lili’s desktop site.
You must also be a freelancer or independent contractor/small business owner to use Lili; non-freelancers are asked to search elsewhere for their banking needs.
Once you’re in the app, you can start and complete an application. You’ll be asked to provide your email address, full name, phone number, date of birth, social security number, and mailing address. Lili will also ask you to choose what type of freelancer or independent contractor you are from a dropdown menu.
Within a few minutes, you’ll have a brand-new bank account. It may take up to two weeks for your Lili Visa Debit Card to arrive, but the Lili app also provides its users with a digital card. (So, you won’t be stranded and penniless!)
Using the app, you can:
- Fund your account
- Access account and routing numbers
- Pay bills
- Review transaction history
- Generate expense reports
- Find local ATMs
- Modify debit card usage settings
- Categorize transactions
- Set up direct deposit (ACH transfers or mobile check deposit)
- Link to external bank accounts
- Link to external platforms (Venmo, PayPal, Cash App, Apple Pay, etc.)
Once your physical card arrives, you’ll need to activate it before you can use it.
You can add your business name to your Lili bank account if you’re operating under a DBA, “doing business as,” or a single-member LLC (using your social security number instead of an EIN). You must provide Lili with your tax return, business license, or fictitious name registration. Once everything is verified, you can accept payments and check deposits using your business name.
How much does Lili cost?
Lili is a fee-free online banking service, which means there are no monthly fees, minimum opening deposit, or minimum balance requirements — no matter how low your balance is.
But Lili Pro, which has a $15 monthly maintenance fee, offers various benefits, such as overdraft protection, an emergency savings account with 4.15% APY, an invoicing tool, and a business Visa debit card cashback. Lili will also pre-fill your annual 1040 Schedule C form.
Another option is Lili Smart, which costs $35 monthly and comes with accounting and tax preparation software. If you want priority support and a dedicated account specialist, you might opt for Lili Premium for $55 monthly.
Lili features
Lili may not offer a business credit card or any other fancy products that the competing business banking services offer, but Lili shines where it counts. Here are a few of Lili’s best features.
No ATM fees
Lili isn’t a traditional bank, so you’re probably wondering how cash deposits and ATM access works. (I know I did!) With Lili, customers can withdraw cash fee-free via an in-network ATM. There are more than 32,000 MoneyPass ATMs in the US. If you’re having trouble finding an ATM, the Lili mobile app has a built-in locator to help you.
Lili members can deposit cash at any of the 90,000 participating Green Dot locations. Lili does not charge fees for cash deposits. However, the Green Dot retailer may charge a fee of up to $4.95 per deposit.
Note: Lili bank members are limited to making deposits of $1,000 in a 24-hour window and are maxed out at $9,000 per month.
Expense management tools
The Lili app provides several built-in tools to help members manage their expenses and plan for taxes. For example, you can categorize your spending by swiping left for “life” (aka personal expenses) and swiping right for “work” (or business expenses).
Each time you use your card or purchase using your Lili account, you’ll receive a notification on your smartphone with a note that says, "You just spent $10 at ‘Starbucks.’ Is this a work expense?” (The place and amount will differ, but you get the picture.) Then, you have to click the notification and categorize the expense. Lili will do the rest!
The Lili app also gives you the option to:
- Add receipts to transactions
- Download quarterly and annual expense reports
- Track spending in real-time
- Automatically save a percentage of funds using the freelancer-friendly Tax Bucket feature
- Open an Emergency Bucket (savings account for emergencies)
In addition to the app’s built-in tools, the Lili website offers resources and how-to guides for every kind of worker, from freelance writers to artists to subcontractors.
Automatic savings
Lili reeled me in with its auto-saving features. Lili has two automatic savings options:
Tax Bucket. The Tax Bucket feature allows you to set aside a percentage (you can change this at any time) of your income into your Tax Bucket. To help you decide, Lili will ask you to choose your profession and answer a few simple questions. You can change it if you’re unhappy or disagree with the percentage.
Emergency Bucket. Saving for taxes is hard, but saving for emergencies is even harder. Why? Because once you’ve done the responsible thing and set aside money for Uncle Sam, sometimes, there isn’t much left over for you (which can make saving on top of saving difficult). With Lili’s Emergency Bucket, you can set aside a fixed daily amount for your Emergency Bucket. And don’t worry: you can pull this money out any time.
Related: How to Start an Emergency Fund
Better banking is here.
- No account fees
- Earn up to 4.50% APY
- Up to 2-day-early-paycheck
- No-fee Overdraft Coverage.
- Do it all in one app.
- Up to $2M of additional FDIC insurance through a network of participating banks.
Who is Lili best for?
Small business owners
Lili is advertised as a freelancer checking account, but business owners can benefit from its features, too — especially if you have a newly founded startup.
Freelancers and independent contractors
Lili is great for seasoned and newbie freelancers alike. Its app has expense tracking and reporting built right into it for easy access. You can also set money aside for taxes and emergencies to ensure you’re covered, no matter what happens.
Who shouldn’t use Lili?
People who prefer a brick-and-mortar
If you’re fond of traditional banks, Lili isn’t for you. In addition, anyone who is not a freelancer, independent contractor, or small business owner should not open a Lili account. Or, if you’re a freelancer interested in getting a business bank account that provides additional resources or information on credit cards or increases your credit score, you may consider opening a Credit Karma Money account.
Pros and cons
Pros
- Easy to get started. Opening a new account with Lili is quick and simple. According to the site, it’ll only take you three minutes.
- Security. Lili asks for a verification code each time you log in.
- No fees. Lili doesn’t charge a monthly service fee or charge for in-network ATM withdrawals.
- Early direct deposit. With Lili, you can get paid up to two days earlier with an early direct deposit.
- Real-time spending notifications. The Lili app will send you a push notification whenever you purchase, pay a bill, or receive a payment.
- Expense tracking. Why pay for QuickBooks when Lili offers expense tracking for free?
- Automatic savings. Lili allows you to put your savings on auto-pilot with its Tax Bucket feature and its Emergency Bucket feature.
- Mobile deposit. Lili members can deposit paper checks via the app by taking a photo of the check and uploading it.
- Cash deposit at any Green Dot location. There are 90,000 Green Dot locations in the US. Some retailers include RiteAid, CVS, and Walmart.
- Mobile payments. If you forget your wallet at home, you can use the Lili app to pay for things.
- Fee-free cash withdrawals. With Lili, you can make free cash withdrawals from more than 32,000 ATMs across the US. The Lili app also includes a built-in ATM locator.
- Referral program. Lili will give you $50 for referring your freelancer friends to use the app.
- Lili Creators program. Lili also has an influencer program called Lili Creators. According to the site, Lili will pay you every time one of your followers opens an account.
Cons
- Bank transfer limits. Lili won’t allow you to transfer more than $200 per day or $1,000 per month from another bank into your Lili account.
- Bank transfer time. When you transfer money into an external account, it takes up to five business days to process.
- The mobile check deposit is wonky. The mobile check deposit option isn’t the most user-friendly feature of the app. You also have to make sure the photo is just right and that each check you deposit has the words “for Lili mobile deposit only” on the back of the check.
Lili vs Novo vs NorthOne
Bank | Minimum deposit | Min balance requirement | ATM fees | Account types |
Lili | $0 | $0 | $0 in-network; $2.50 for out-of-network; $5 for international | Business checking |
Novo | $50 | $0 | $0 | Business checking |
NorthOne | $50 | $0 | $0 | Business checking |
Novo
Novo is an online banking service that allows customers to open a business checking account. Unlike Lili, Novo customers can use the browser version of the site or the app to do their business. There are no monthly fees or minimum balance requirements, but Novo does require a $50 minimum deposit to open a new account. Small business owners and freelancers can snag discounts on services like Stripe and QuickBooks with Novo.
NorthOne
NorthOne allows customers to open a business checking account for no monthly fees. There’s also a minimum deposit requirement of $50. Although NorthOne is great for freelancers and small business owners alike, its pricing structure is a bit of a downfall.
FAQs
Is Lili a good bank?
The term “good” is subjective, but if you’re a freelancer or independent contractor who’s looking for a fee-free checking account option, Lili could be a good choice as Lili is a no-fee online banking service that offers free expense and tax reporting tools.
Is Lili a bank?
No, Lili’s banking services are provided by Choice Financial Group and deposits on all accounts are FDIC insured up to $250,000.
How does Lili bank make money?
According to Bar David, Lili only makes money from card processing fees.
Better banking is here.
- No account fees
- Earn up to 4.50% APY
- Up to 2-day-early-paycheck
- No-fee Overdraft Coverage.
- Do it all in one app.
- Up to $2M of additional FDIC insurance through a network of participating banks.
The bottom line
Lili is a great banking option for independent contractors, freelancers, and new small business owners. With Lili, you can track expenses, save for taxes (or other emergencies), and get paid earlier with an early direct deposit. There are no account fees associated with Lili and no minimum balance requirement. (Yes, even if you have $0 to your name.)
The only downfall to Lili is that you cannot access your account using a desktop or laptop. (This may change in the future, though!) Depositing checks via mobile can be a pain, but Lili is a solid banking choice overall.
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Writer
Tabitha Britt is a New York-based freelance writer and editor whose work has appeared on INSIDER, the Huffington Post, and Taste of Home. When she's not glued to her computer screen, she can be found walking her beloved pooch, Biscuit.
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