Whats the worst mistake small business owners make with their personal finances?
We see many business owners who are generating significant amounts of cash and delegating the management of their personal finances to their company CFOs. That’s a decided mistake for a variety of reasons, but it’s quite common. What’s wrong with doing that? When the business owner starts out, he may have a small personal investment portfolio, so he asks the CFO for advice. It seems to make sense: This is a trusted, knowledgeable adviser from a corporate perspective. But the challenge is that as the portfolio continues to grow, that CEO should start availing himself of an increasing array of investment options that a corporate CFO may not be familiar with. Also, the priorities for an individual — minimizing taxes and measuring the retirement time horizon — and the priorities for the company, which is taxed at a different rate and may have a different exit strategy, are probably quite different. At some point, does the CFO have to stand up and say he or she is getting stretched too th
