I often wonder why people spend the best part of their lives growing their business – only to let this asset vanish or dissipate on their death or disablement.
Nothing can cripple, or even sink, a business faster than default action on a commercial loan, or demand under a loan guarantee. In many cases, the consequences are far reaching and can impact not only the business entity but also its principals, their private assets, family members, shareholders, directors and other creditors. Business debt protection is designed to provide funds to help pay for business loans in the event of a business owner passing away or suffering a serious disability. It’s a risk that every size and type of business should consider protecting against.
Why consider business debt reduction?
As a business owner you may be personally liable for loans and expenses incurred by the business. This happens if you secure a business loan with personal assets, usually your family home. Until you repay the business loan your personal assets are at risk. Should you die or become disabled, these personal assets could be placed at risk by the bank or lender requesting full repayment of the loan. This would place considerable strain not only on the business, but also your family especially if you’re a guarantor.
How can Debt Protection help?
Debt Protection insurance would provide the funds to repay any existing business debt and helps minimise impact to your business operations. This reduces the risk of your personal assets like your family home being sold to pay for business debts and expenses especially if you are a guarantor.
A good Business Debt Protection plan forms an important role within a business will.
Call Grabowski Financial Planning today if would like to discuss how a business debt protection plan may help you. Remember we are your local Financial Planner located at Narellan, Just near Camden, Mount Annan, Smeaton Grange and Oran Park.