Why Keep It In The Business?

Dave doesn't think Mark is utilizing his cash as well as he can in his small business.

QUESTION: Mark owns a small business that is coming into a lump sum of money. He is enrolled in Financial Peace University and an irregular income is hard to budget for. Should he take a payment in salary and pay off the debt or leave it in the company as operating income?

ANSWER: If the company will survive if you take it out, then take it out and pay debt with it. Why would you leave it there? If you want to leave enough in there to keep your company out of jeopardy based on your business projections, then do that and bring the rest home. Don’t leave excessive amounts of cash in the company just for the heck of it.