Let’s talk Business:How to keep your personal credit clean

Protect your personal financial history so that it doesn't become a professional liability. As a business owner and entrepreneur, you already know that it’s very important to maintain a clean credit history. But when you extend the credit for personal use, it becomes even more important to keep afloat. You need to be alert about how you manage your credit, however small the amount is so that it doesn’t become a liability. Good credit is really about managing your balances.

Protect your personal financial history so that it doesn't become a professional liability. As a business owner and entrepreneur, you already know that it’s very important to maintain a clean credit history. But when you extend the credit for personal use, it becomes even more important to keep afloat. You need to be alert about how you manage your credit, however small the amount is so that it doesn’t become a liability. Good credit is really about managing your balances.

Here are some tips for maintaining a clean credit record;

Pay your bills on time--every time. Stretching out payments to vendors can be a good way to manage your company's cash flow, but it's a bad habit to get into when paying your personal credit card bills. Any late payment is gets reflected in your creditor’s tax statements, and the banks notice these reports.  This affects can affect your ability to get business financing as well.

Keep small balances on multiple accounts. Never dry out your accounts. This makes the banks nervous. Although you may want to keep all your money on one account to maximize on the interest earned, it's a good idea to spread out your balances on multiple accounts, as it even helps you create relationships with different bankers.

Don't shift your balances from one account to another. While you might want to shift all your money to one account, the one that pays the highest interest rates, the point above explains it all. It would dry out all your other accounts, making bankers nervous, and killing that reputation.

Don't apply for too many accounts at the same time. Keep as few accounts as possible, to reduce spreading out your finances. This helps you improve the relationship with your particular bankers as you have more movement on your accounts, the fewer they are. The bankers also would feel safer to lend you the money if they know your money isn’t spread out thin.

Don't file for personal bankruptcy. As a business owner, it's OK to fold your cards and start over. Personal finances are quite different: A personal bankruptcy filing can stay on your credit report for as long as 10 years. Do everything you need to do to repay your loans, since once you file for bankruptcy, it will take a long time for bankers to feel safe about lending you again.

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