We run across clients on a consistent basis who have an immediate need for funds but are not structured properly to get through the approval process. It seems a little backwards but the best time to prepare for funding is when you don’t need the money. The only challenge is to not spend it when you don’t need it.
You have probably ran across the individual who says they only work with cash, they don’t do credit. The reason this mindset become popular was because of will power. People spent what they didn’t have and what wasn’t theirs. The problem is that this mindset is extremely detrimental to the individuals opportunity in life.
As a quick example, look into buying a home and the qualification process. You will find that it is a pretty standard requirement that someone has at least 3 tradelines reporting on their personal credit report. So unless you are going to buy the house in outright cash, you are stuck with renting. Let’s say that you have a vision of starting a business. Good credit and history allows you to get up to $150,000 in unsecured lines to get going. No credit cards and no history will net you $0 in funding. Taking this concept further, look at interest rates. Car payments go up with no history and anything else that you look to buy with financing. Good luck qualifying with no history though.
Prepare for the Future Unknowns!
Money may not buy everyone happiness but it certainly makes getting through the unexpected in life much easier when you have it. This leads us down the path that financials and credit are really the only way to properly prepare. By taking just a couple steps you can rest your head at night comfortable.
1. Personal Credit – Everyone, good credit or bad, can and should take steps to increase their financial capabilities every year. A credit report is filled with companies making statements against you and you do have rights. Clean up the mistakes that are made and always look to increase your limits when you can. DO NOT close down old accounts with great history.
2. Build Business Credit – A business reports to major credit bureaus just like a personal account. It is very real and very possible to establish vendor accounts strictly under the business with no attachment or personal guarantee. Only 15% of businesses are actually aware and properly prepare. You can increase your options for the unknown by having almost like another identity.
We could mention other items such as a bunker, food, and building a savings account but these 2 steps can help weather most storms. Financials become a lot less important when the world is ending but the good news is that we don’t plan on that happening any time soon.
We’d be happy to assist in getting you as prepared as you can be!