How to Build Business Credit With Poor Personal Credit

Form an LLC

In order to begin the process of learning how to build busniness credit the credit bureaus need to know you exist. There are a few steps you need to take to get on their radar.

One of the first things that must be done is forming a legal entity like an LLC or a corporation. This is an important step because once you establish an entity separate from your self you qualify for the Identification the business credit bureaus use to track your business. Once you register your business in the state in which you do business the next step is applying for an EIN with the IRS.

Your EIN will be to your business what your SSN is to you. and will allow you to build business credit by applying for lines of business credit. Forming a legal entity and following the steps laid out in this article could ne the difference between you being able to use OPP ( others peoples paper) to bankroll your business or having to rely on your own savings and bootstrap.

Get a Business Bank Account

Once you form your LLC and receive your EIN number the next step is to open a bank account. The safe way to go is to open an account for receivable; meaning an account that is responsible for house all of your incoming sales. You will want to open a second account for accounts payable. This account will be where all of you expenses are withdrawn from this keeps everything clean and easy to manage when doing business accounting. at some point you may even opt to open a third account for a business savings.

A bank account is crucial in the early stage of your business on account of the fact that if you have poor personal credit. When you are looking to build business credit with poor personal credit some lenders that do not require a personal guarantee will want to verify some way that you are able to pay back a loan. They do this by looking at your finances and using you sales as a guide to determine how much to give you. Separating accounts payable and receivable gives you the ability to leverage all profit with out the loss.

Apply for a Duns number at Dun & Bradstreet

Your next step will be registering your business with Dun & Bradstreet and applying for a Duns number. This nine digit number is used to identify each location of your business. Any business registered with the government can get one for free.

Dun & Bradstreet offers multiple products all aimed at you being able to monitor and build business credit. If you opt to sign up for the credit account they give you access to your Paydex score. Knowing this score will help you better determine what loans you may qualify for.

Apply for business trade lines that don’t require a personal guarantee

When you create an LLC you are under the impression that you are fully protected from any and all liability. This means when completing credit and loan documents you wouldn’t have the nuance of being judged by your own sorted financial past. Unfortunately when you are starting a new business credit a lot of companies will still require some good will in the form of a personal guarantee.

This is a big nuance for someone who has poor personal credit. however, there are so many ways to build business credit with lines of credit that do not impact your personal credit. One way to do this is by signing up for net 30 account. Companies like Uline Grainger, and Quill offer company accounts in which you can make a purchase and have 30 days to pay off the balance. These trade lines often report to the credit bureaus weekly.

Apply for a business credit card that does not require a personal guarantee

Arguably one of the fastest ways you can figure out how to build business credit with your new business is by using a business gas cards. Due to the frequency of use. If done right you can see some good results in the first 90 days. The Caveat is If you have poor personal credit you may have to put some of your working capital down to secure it.

Another great business credit card to apply for that does require any personal guarantee is Divvy. Divvy offers several products for business beginners as well as products for businesses who are already receiving sales and businesses who haven’t quite made any money yet. They have products for any business.

There are also more products for more established businesses that offer lines of credit with no personal guarantee like Brex, Ramp, and Nav. For the most part these companies require you o have strong sales in order to get approved for a line of credit.

Nav is probably the most establishes a robust company out of the three offering not only products to help you finance your business but they also offer a business dashboard that serves as a hub for all of your business accounts. They have the ability to integrate with Dun & Bradstreet, Banks, and other net 30 accounts that allow you to monitor all of your accounts in one place.

After you choose the products that work for your business and create a plan for when and how you will approach financing. Sit back and watch the magic unfold.

7 Habits of highly effective Mom Bosses

Getting  Organized

I know this one seems so obvious. It goes without saying organization is the key to any successful plan, However many will tell you to get organized but not tell you how. Organization isn’t one size fits all. Sorting through all of the noise in your head can be a lot Start with asking yourself questions like: What are you organizing? What does organization look like for you?

A highly effective mom boss has to know both her strengths and weaknesses. For instance if you are someone who gets easily overwhelmed or distracted you may want to plan for the organization stage to take two or more weeks. The point is to not get down on yourself for not getting organized in a specific period of time. work at it at a pace that resonates with you and your mental health and graduate to the scheduling stage when the time is right.

Creating a Schedule

Family life can be like a jigsaw puzzle from pitch presentations, recitals, sports practices and business trips scheduling can be challenging. Once you have gotten all of the important stuff out of your head, as a highly effective mom boss you should create a schedule to optimize your time and create efficiency in your day. The trick business wise is breaking down bigger goals into mini milestones giving yourself the best chance at success with each micro goal.

Planning everything around your child’s school and extracurricular schedule and setting realistic time expectations is key. Finding the balance with this will be trial and error until you find your groove just stay consistent and you will reap the results of being organized and on a schedule.

Meal Prepping

In a recent survey conducted in 2019 it was found that the average woman with full time employment spends an average on 21 hours on housework. That is the equivalent of a part time job. Realistically having your own business is 24/8. A highly effective mom boss doesn’t have time for that. Unfortunately, we have to make the time. One great time saver is meal prepping.

Meal prepping isn’t just making casseroles and freezing them until your ready to eat them. It is a science. You will need to create a sensible menu, create a shopping list and actually go grocery shopping. I personally find it helpful to order on an online platform like amazon fresh and meal prep on Sundays and Wednesdays. This way I don’t have to spend an hour or more in the grocery store plagued by long lines and and congested parking lots. Meals are prepped 3 days in advance and there is no concern about any possibility of food being spoiled or soggy.

Being Consistent

The road is bound to be bumpy. Once you have created your schedule and started your meal prep you will inevitably experience failures and set backs. With that being said one of the most important habits of highly effective mom bosses is staying consistent. So how do you do that? Set your intentions, manage your expectations, and manage your emotions.

A manifestation journal or planner is a helpful tool when working to maintain consistency. It is the perfect road map for the micro milestones you make for yourself and will ultimately ensure you get to the get you to the finish line. Once you find your groove you can play with how much or little you put on your plate. When you track things it is easier to see what works for you.

However, as a highly effective mom boss you know innovation does not happen in comfortability so I would challenge you to continue to grow and continue to challenge your self in the healthiest way possible.

Maintaining a Strong Network

Getting organized, creating a schedule and being consistent will give you a strong leg up in being a high effective mom boss. However, it is true what they say it truly does take a village. Surely you are every woman but still you are just one woman. it is important to network and build long lasting sustainable relationships not only in business but in your personal life as well.

A business bestie is a must when navigating these entrepreneur streets. Building a strong community of women of like minded woman like Muva Boss Moves. A good network can aid in resources, services, and accountability. You may also be able to support each other with child care. If you don’t have a network or need help strengthening your current network you may find it helpful to look into groups for mompreneurs on facebook.

Having a Healthy Work Life Balance

Kids spell love T-I-M-E as famously quoted by Zig Ziglar. Kids value the time we spend with them more than they value the things we can buy them. There are times that our focus on the daily grind distracts us from making sure our kids get an adequate amount of our time especially as a solopreneur. There are ways around this. You can still be a highly effective mom boss and super mom at the same time.

Some ways you can maximize the quality time you spend with your kids is by including them in some of your daily tasks. For instance getting the kids in the kitchen to act as sous chefs during meal prep. This teaches them how to navigate in the kitchen and is a great time saver for you. You can also hire your kids to work in your business. There are many advantages to hiring your kids in your business like; building wealth for them at an early age, teaching them responsibility, and the ultimate advantage more time with you.

Practicing Mindfulness and Gratitude

Mindfulness is a form of meditation that helps you focus on becoming intensely aware of what you are feeling and sensing in the moment. It is a strong proponent in helping to manage stress and anxiety through guided imagery, and breathing techniques to relax the mind and body.

As mom boss we often find ourselves in a high stress working environment putting loads of pressure on ourselves to make our goals this can sometimes bleed into home life. Our children are like sponges and are likely to mimic us in the way they receive and process information. Helping yourself and your kids learn how to deal with big thoughts and emotions is crucial.

It is so easy to get caught up in our own head daydreaming, problem solving, planning, and worrying. Doing these things in access can be draining and cause stress, anxiety and could even lead to symptoms of situational depression. Learning mindfulness and gratitude exercises and incorporating these techniques into your family life by including the children will create an outlet for you and your children to direct your attentions from thoughts and feelings that do not serve you and teach yourself and your kids to be present in the moment and adopt healthy coping mechanisms.

When you incorporate all of these steps in your life and get your kids onboard you will see your self being the highly effective mom boss that you know you can be. You will also see yourself becoming an emotionally whole healthy woman and as a biproduct you will be raising emotionally whole and healthy children. With a little time to spare for some self care.