Tag: risk managementSubscribe 3 Posts
Choosing the best business structure for your startup is vitally important. But many business owners stumble upon their business structure by accident without any planning at all.
You’re a small to medium business owner and as such, you are a risk taker whether you accept that or not. You have foregone a stable employment income for life as an entrepreneur. You experience all the advantages of self direction and being your own boss but with the headaches of unstable income flow and business risk. According to a credit reference checking agency, Veda Advantage, over 90% of businesses survive their first year but less than 45% last 9 years or more. Risk is a small word, but it comes in many forms for a business owner to deal with. So how can you manage risk? The first step is to identify the specific risks that could affect your business, and then you can formulate a plan to mitigate those risks. Just ignoring risks by not looking for them is no solution!
When talking about retirement planning, “my business is my retirement fund” or “I don’t plan to retire” are both common responses among small business owners. However, the fact is that you are likely to decide to pull the pin at some future date or will be forced to do so because of health conditions or changes to your industry. Saving for retirement is tough when you have ongoing costs and plans for expanding or funding your business activity. Some workers estimate their retirement income needs using a percentage of existing income, but this does not work for a small business person building a business and foregoing extra income to build long term wealth.