Page 24 - How To Avoid Going Bust In Business

p.a. Problem solved. And a lot of people would love to have $80k a year to play
with.

Sure, life will be a lot different, a lot simpler. Trust me, it will be a great deal more
different if you keep on the same old course. The courts, civil and criminal, have
little sympathy for those who lead the high life on someone else’s money.

My family and I have lived on mince and sausages for months while I ground down a
mountain of debt. Even so, we managed small treats. There is a very good bakery
not far from my house and it is very reasonably priced. For Sunday lunch I would
take my kids there and as a special treat they bought a cake each. Luxury. Cheap.

Friday night we would have fish and chips from the takeaway shop across the road.
We would all sit around on the floor in the living room with a paper parcel of assorted
food items and a couple of scoops of chips. Cost – under $20. But great family time.

It doesn’t have to be hell every day.

Go through the family spending line by line and pare it back wherever you can.

Extravagant living sends a lot of otherwise sound businesses to the wall.

I had an acquaintance who was the CEO of a finance company that went belly-up
owning hundreds of millions of dollars. Thousands of people lost money, some of
them their life savings. He was investigated by the Fraud Squad for a raft of illegal
dealings.

We were at a birthday party for a mutual friend and the financier’s wife confided that
she was a bit tired – she had just got back from doing her Christmas shopping in
London. Did this bimbo not get it? The gravy train had been derailed at high speed.
A good many of her husband’s investors were having a very, very lean Christmas. I
thought at the time if that story leaked out there would be a lynch mob tearing down
the gates of their mansion in the posh part of town.

He’s safe from the lynch mob these days – and will be for some years.

6: Crash dive the business spending

Again, go through the business budget – you do have a budget, don’t you?! – line by
line looking for savings. There isn’t a business alive that can’t have unnecessary
spending squeezed out of it.

Some items can’t be avoided – power, phone, rent, water, local taxes - but a
surprising number of expenses can be delayed a while without grievous financial
harm.

Get your whole staff involved (see further on). You will be amazed how they will find
ways to trim costs, especially if they know their jobs depend on it.