At a recent seminar the guest speaker asked the question: “What’s your most important asset?”
Many small business owners are the major bread-winner of the family.
Here’s an example of just such a person who was suddenly stricken with cancer and was no longer able to work. The treatment cost $1000′s and they had no income protection insurance.
He’d been diligent in building up a property portfolio valued at around $3million, with outstanding loans of around $2million, so there was $1million in equity.
During the 18 months of treatment, with mounting financial presures, the family sold off their assets for around $2.7m, paid off the loans of $2.05m , legal fees, agents fees, and capital gains taxes amounted to $766k, leaving their net worth at around $234k
Suddenly their net worth dropped from $1m to $234k. Could they have done anything differently?
Maybe. How would you cope in that situation? Many business owners will obtain building and contents insurances etc, but not look after their most important asset – themselves.
Next BAS due
