Cash flow, keyman, and covenants
For business owners, cashflow is the “blood” of your business’ circulatory system.
As a fellow business owner; I understand the critical role cash and cash flow play.
It’s why we developed the SCORETM methodology of planning.
It’s all too easy to become asset rich while at the same time cash flow poor.
Times of disruption, like now, can create real opportunities; so how do you make yourself as nimble as possible to capitalize?
In the Wall Street Journal morning ledger on Monday 4/24/23, in an article titled “Why lending may tighten for small businesses”, Robert Kaplan the Dallas Fed Chair pointed out that some business owners may get a call from their bank with new terms or “covenants” and/or pricing by the end of the year.
How can we ensure that we have ample operating cash flow?
A couple of thoughts:
1. Fostering relationships with key bankers you know and trust is always a good idea. It’s never a bad idea to have diversified suppliers as well as diversified clients.
- How is your cash reserve? Is it time for your own personal SCORETM, and/or a meeting with your financial team?
- Do you have keyman insurance in place?
Keyman life insurance can protect your family, the business, and make bank financing a bit easier to get.
If you don’t have keyman insurance in place; now may be a good time to evaluate your whole financial picture, including your exit strategy as the current estate tax exemption may sunset and be reduced at the end of 2025.
Now more than ever may be a great time to gather your team.
Don’t have a team?
Would you like to see if SCORETM makes sense for you?
Orchestrating Fiscal Harmony™,
Kelly Kunst CFP®
Founder
2022 Five Star Wealth Manager
Once again, I am honored to be named a Five Star Wealth Manager by Texas Monthly. Nearly 4,000 Dallas-Fort Worth wealth managers were considered for the award; ten percent of these candidates were named 2022 Five Star Wealth Managers. Being recognized is always nice, but the real blessing is serving families and helping them on the path to fiscal harmony in their lives.
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