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Three simple ways to ensure financial security in a struggling economy

3:45 AM Posted by Slamy

n the midst of a recent economic collapse, many businesses are facing one of two fates: drastic spending cuts or closing their doors for good. Fortunately, today is a good time to own a home based business. Home based businesses seem to be the least of those affected by the recession because many home based business owners have made the changes necessary to ensure their financial security. You can and should do the same.

First, you must minimize debt. The credit crunch has raised interest rates on some loan accounts and even decreased the loan amount on others. Now is not the time to be in over your head in debt. Budget your money so that you can pay down debt as quickly as possible. Greatly reducing the amount of money you own on loans will put more money in your pocket and give you the financial cushion you need.

Second, spend smart. Although we are in the midst of a recession, it is important to continue pumping money back into the economy. Just do so wisely. Take a good look at your budget and make the money you do have to spend go further. Buying used or ‘second best’ products will save your business from spending frivolous amounts of money on brand new, top notch products.

Most importantly, save! Many businesses going under right now are doing so because they did not save any of their profits. Their savings were merely in investments, like the stock market, which are not worth much at all right now. You must save in order to ensure the financial security of your business. Having several months’ worth of operating expenses in your savings account will give you the ability to ride out the storm if the going gets tough for a few months.

Each business owner is in charge of one owns destiny. You have the information and the tools at your fingertips to make the necessary changes to your business. Now, you must apply what you’ve learned to make your business as financially secure as possible.


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