Financing a small business takes an acute awareness of many variables, from rent to logistics costs, many of which fluctuate rather than stay the same. In light of this, many business owners hesitate to pay themselves a wage, instead opting to keep re-investing the capital they gain towards the goal of helping their business continue to grow. However, there is a serious case to be made for business owners paying themselves a wage, even if it is not a fortune starting out. Here are a few reasons why: It helps keep business and personal expenses separate. When personal expenses get balled up into business costs, it creates a slew of problems. For one thing, it makes accounting more complicated since differentiating between true operating costs and other purchases adds time to the process. Additionally, it can be bad for employee morale to treat a business like a debit account. Lastly, using business funds to purchase personal items runs the risk of a business owner losing

  In a press release from CDC Loan Experts, three strong reasons were put forward for business owners owning their storefronts. Firstly, purchasing a piece of commercial real estate is a long term investment that can be turned around for profit later, rented out, or kept as a business location without the obligation of rent. Secondary to this is the fact that payments for rent may be contingent on market prices and therefore subject to fluctuation. Businesses that would be forced to move in the event of a rent increase will pay the same payment for the property they are purchasing, making buying a good strategy for those looking to stay in a location for the long term. Lastly, a purchase payment may be less expensive than rent would be in the first place, with the bonus of eventually owning the piece of property. Should you invest in purchasing your location? If business owners are planing on staying in their physical location for the next ten

While there are many talented business owners out there who have successfully managed to grow a business with bad credit, often without the benefit of conventional small business loans, personal finance is another subject that they may not have mastered in relation to their business. Your salary should be separate from your business’ s cash flows. A business is not a wallet, and it’s usually the case that more people depend on it’s success than the owner alone. Bad credit issues can arise for a number of reasons, as well as linger long after a problematic event, making it so that expenses unrelated to a business can pile up. Even in this case a business should not be treated like a personal rainy day fund. Even with the best of intentions, if you borrow from your business and it becomes a habit, then your main source of income becomes dangerously jeopardized. Limit your spending by reducing unnecessary costs. How can you identify unnecessary costs? If you don’t

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