What Would You Do for Your Business?
This is a little post on an observation I’ve made while working at my job, where I often deal with small business owners and their finances. It surprises me, but it is common to find business owners that are willing to use their personal retirement funds to keep their businesses going. The other day one just decided to sell personal stock for capital. Others use money from their 401K, or general savings that they had set aside for retirement.
Not all of these owners are young, either. We normally deal with established businesses with older owners (I would say 40 and over). It just saddens me that these people are willing to part with their personal money to keep generating funds for their business. There are definitely other alternatives out there that don’t involve having to look to your own personal accounts. I’m sure to some people, they have a lot invested in their business, and if it dies, a part of them might die with it. But thinking about the future is important – what are you going to be left with after the business is gone?
Most of these businesses are also not home based – some have a small amount of employees, others are restaurants. A few business owners find themselves over-leveraged, trying to make ends meet, and often their credit is ravaged and there’s not much help coming their way. Others have just hit a rough spot (who hasn’t these days?) and a few are seasonal and need extra for cash flow. I just can’t believe that people will resort to depleting their resources in favor of getting their business back on track. I understand that perhaps to get your business started in the first place, that this might be necessary. If you don’t have any investors and you’re trying to make it on your own, then it makes sense.
The Question to Ask
I know some people on the PF blogosphere have had experience owning their own business, or currently do. Would you agree that digging into your retirement funds is a good way to keep your business afloat? What would you do if you were running out of funds? For those that don’t have their own business, do you think you would ever be willing to part with your retirement savings (or savings in general) to put money into maintaining something you worked hard for? What’s your take on this?
Just something to think about. Have a great weekend everyone, and Happy Father’s Day to all the dad’s out there!
Photo Credit: occupywinstonsalem.org