For small business owners, their personal financial situation and their company’s financial situation can be significantly intertwined. This can be seen in some of the results of a recent survey by the Federal Reserve Banks.
The survey, the Small Business Credit Survey, was conducted in 2016’s last two quarters. Over 10,000 small businesses from throughout the country were respondents to this survey.
The survey indicates that financial challenges are pretty common for small businesses. Such challenges were something 61 percent of employer firms reported facing.
It appears it is also very common for small business owners to use personal funds to help their company when such challenges come up. The survey found that 76 percent of employer firms filled budget holes using personal funds when financial challenges came up. The use of personal funds was particularly common among especially small businesses.
As this illustrates, a small business owner can end up pouring a lot of their own money into their business, not just when the business is getting off the ground but also during the course of its general operations.
So, the financial well-being of their business can have significant impacts on an owner’s personal financial well-being. Given this, small business owners can have a lot at stake when it comes to matters that could affect their business financially.
Among the things that can have financial impacts on a small business is how legal matters that come up for the business are addressed. Mistakes when it comes to such matters can have significant negative financial repercussions for such companies. So, getting solid guidance on how best to address legal matters related to their company can be important for a business owner at their business’ start and at all stages of their business’ lifespan.
Source: Reading Eagle, “Fed Bank report shows small businesses face challenges,” Jeff McGaw, April 12, 2017