Course: Why businesses borrow money
14 minute read
Keep business and personal finances separate
When you’re starting a new business, it can be easy to commingle your business and personal finances. Maybe your first few deposits went into your checking account, or you bought supplies with your personal credit card.
Don’t make it a habit, though. If you are using personal sources of capital like home equity or a personal credit card for your business, be very careful — especially if you’re using credit to plug a leaky hole. The hole will continue to get bigger if you don’t make a fundamental change. Business success isn't guaranteed, and worst case, you could end up with a large amount of personal debt that's hard to dig out of.
