Business Credit Matters: Strategies for Financial Management
Hey everybody, it's Micah, and welcome back to another episode of the Common Cents Show! Today, we're diving into a crucial topic for small business owners: business credit and financial management. We have two experts from Jay Galt joining us, Earl Adams and Deb Wyant, to shed light on this subject and dispel some common myths.
Why Business Credit Matters
There's a lot of misinformation floating around social media about business credit and funding. Some even endorse fraudulent activities to secure funding. That's why we're here today—to provide you with accurate, actionable information on how to manage your business finances properly.
Meet Our Guests
Deb Wyant, Chief Administrative Officer at Jay Galt Finance Suite and Jay Galt Capital, and Earl Adams, Chief Marketing Officer at Jay Galt, are with us today. Both bring a wealth of experience in helping small businesses navigate the complexities of business credit and financial management.
The Importance of Proper Structure
Deb emphasizes the importance of properly structuring your business to protect your personal assets. She shares how many small business owners don't know how to pursue business credit safely. The mission at Jay Galt is to help these owners build a credit structure that doesn't rely on personal guarantees, much like large corporations do.
The Reality of Small Business Failures
Earl points out that around 594,000 businesses shut down last year, with 83% stating that access to credit could have kept their doors open. The ripple effect of these closures is vast, affecting not just the business owners but their families, employees, and communities.
Common Pitfalls in Business Planning
One of the biggest challenges small businesses face is poor planning. Many business owners focus on aesthetics or non-essential expenses over critical areas like marketing. Earl advises that it's crucial to prioritize investments that directly contribute to the growth and stability of the business.
Misleading Information and Predatory Practices
Both Deb and Earl warn against predatory practices in the business funding space. Many lenders require personal guarantees, which can jeopardize your personal financial health. They advocate for building credit through your business's EIN, separating personal and business finances to safeguard personal assets.
Building Business Credit the Right Way
Jay Galt provides a seven-step process to help businesses build a fundable EIN structure. This method is not commonly known, even among highly educated business professionals. By educating business owners on this process, Jay Galt aims to empower them to secure the necessary credit and capital without risking personal assets.
Conclusion
Understanding business credit and financial management is crucial for the success and sustainability of your small business. With the right knowledge and resources, you can build a robust financial foundation that protects both your business and personal assets. Stay tuned to the Common Sense Show for more expert insights and practical advice.
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