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by: RobertBain
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When my husband started his own trucking business more than 10 years ago, there was a lot more to it than we ever expected. We got lots of advice, some of it good and some of it not so good. One that we heard over and over again though that we did follow was to keep our business and personal credit separate. After hearing some of the problems that other self employed people we know have had though I am very glad we did.

My husband is self employed and that is a piece of early advice we got from many directions. We chose to follow it even though I will admit I didn't want to at first. I figured we could just put all the earnings in one account and pay the bills from it as we had always done. I didn't want to have to juggle another checking and savings account as I have my hands full as it is!

We did get a business credit card and line of credit early on as well. We got both of them from the same lender which was good for us. Yet the interest rates on them weren't something I was proud of. I am happy to say though that we have proven to be worthy of that credit. We still have those same two accounts with the same creditor today.

Finally we found a creditor that understood why we wanted to have our small business finances separate from our personal finances. They gave us both a business credit card and a line of credit. They had small limits but still we were able to establish credit in the business name. Ten years later we still have the same creditor for those accounts. They have increased our access to credit and we have unbelievably low interest rates on them.

You have to understand that any small business has a great deal of risk associated with it. More than half of them won't make it for the first full year. This is a sad reality that you have to understand when you start a small business. This is why you don't want your personal credit to be associated with it. You may find it hard to move on when your business dreams didn't work out but at least you will still have your car to drive and your home to live in.

Should your small business have a financial struggle you don't want to lose your home or your car because of it. Even if you do have a wonderful business you can never predict the economy. There are many reasons why small businesses fail so protect what is yours personality from being affected. Should you end up with a very successful small business then that is wonderful but you need to understand there is too much of a risk to blow off the issue.

I wish I could tell you that it has always been a piece of cake to keep your small business and personal credit separate from each other. It does take some planning, some hard work, and plenty of organization. Over the course of time though it will start to get easier for you. This is one of the best things you can do for yourself though as well as your new business.

Hopefully your small business is going to do very well for you. Who knows, it could turn into a very large business for you some time down the road! While every type of small business is different there are enough key elements that are the same. Among them is that it is necessary to keep your small business credit and personal credit matters separate from each other all the time.

About the Author

Robert Bain writes all about small business. Discover the difference between small business credit and true corporate credit that the banks are hoping you don't discover.

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