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Personal & Business Financial records

If you have enough money to pay your business expenses, but are in danger of losing your home your business is not going going to survive. It is critical to the success of a business that the owner’s personal finances are in order.

In counseling an existing or new small business, I now start with the financial position of the owner. Before we can start putting together a business plan I have the owner fill out my Be Prepared Book and then we complete a financial and goal  review.  In a small business the business and the owner are “one”. The foundation for the business is the personal financial strength of the owner.

If the personal (family) finances are not in order, then  that has to be rectified before we start planning the start of a new business or the growing of an existing business. I get the argument about a person that started a business with no money and now they are now  worth millions. What isn’t told is that for that one success story,. thousands have failed. To give yourself a better than even chance of business success a personal solid foundation has to be in place.

There are ways for a small business to raise capital without endangering the family and their survival needs. My rules for starting a small business include:

  • have enough  money in the bank to carry your family for a 12 month period.
  • have enough money in the bank to cover the business (based on a proper budget) for the first year of operation without counting on any income.

These two rules may sound harsh, but failure is even harder. We have postponed the start of a new business or the expansion of an existing business until the above mentioned criteria were met. In almost all cases, the time delay was worth the effort as there was more time to plan for the business while  funds were gathered to fulfill the financing requirements.  The discipline to achieve these goals translate in a great learning experience for the owner and multiplies manyfold the chances for a successful business.


Opportunity is missed by most people because it is dressed in overalls and looks like work.

Have a great day!

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