Small Business Financial Tune-Up

Wherever your small business lies in the business lifecycle, it may be time for a financial tune-up. Like the name implies, a financial tune-up is a fresh look at how well your small business is working for you, the owner. Here’s a short list of things to consider.

Type of business entity—Many small businesses start out as unincorporated sole proprietorships. The advantages are ease of formation and simplicity of operation. The disadvantages are exposure of personal assets to business liabilities and reporting net business earnings on your personal income tax return.

If your business has grown since you started out, it may make sense to consider a operating under a different business form. Some types of business entities popular with small business owners—limited liability companies, S corporations, and regular C corporations—protect the individual business owner’s personal assets from claims of business contractual and tort creditor. Furthermore, some of these other business forms offer tax advantages to small business owners that are not available to sole proprietors.

Retirement plan—When is the last time you considered whether your employer-sponsored retirement plan was the best plan for you?  Or, if you don’t have an employer-sponsored retirement plan, when is the last time you evaluated the benefits of starting a plan? The landscape for employer-sponsored retirement plans has changed considerably over the past few years and you may be missing out on a great opportunity for both you and your employees.

Health Insurance Plan—Rising health insurance costs remain a major concern for many small business owners, but there are options that can lower costs through tax incentives, for example the Health Savings Account. With an HSA, employees –and their employers, if they choose –contribute pre-tax dollars to an account earmarked for out-of-pocket health expenses. In addition to not paying tax on contributions, participants also pay no tax on earnings that accumulate in the HSA. Moreover, money not withdrawn to pay for medical care is carried over to the next year and continues growing tax-deferred. Provided money in the account is used for health-related expenses or to pay health insurance premiums, the participant pays no tax when withdrawals are made. There is the only catch—not everyone is eligible for a Health Savings Account. To qualify, you can only be covered by a high-deductible medical insurance policy, either through your employer or one you purchase as a self-employed person.

Life and Disability Insurance–Small businesses often find it challenging to attract and retain employees. Employee benefits offerings such as life and disability income insurance are often necessary to compete with the “big boys.” Group plans provide affordable coverage without the need for individual underwriting. This type of coverage can be offered as employee benefits paid for solely by the employer, an employer-sponsored plan paid for by the employee, or a combination of both.

Key-Person Insurance—Small businesses routinely insure their premises, equipment, and inventory. Less common is the business that insures its most valuable assets, its key employees. If you haven’t increased the amount of existing key person life and disability coverage to keep pace with increasing profits and business lines of credit or to reflect the addition of new key employees, there’s no better time to do so than now. As employees age and/or become health-impaired insurance becomes more expensive or outright unavailable. When it comes to acquiring key person insurance, the sooner you act the better.

Business Succession Planning— When business owners think about wealth transfer, they usually think about the transfer of their business or its value. Typically, businesses have only three outcomes at the death of an owner.

  1. Sale of the business to an outsider;
  2. Retention of the business for family members or other surviving owners;
  3. Liquidation of the business.


Business succession planning usually comes down to a decision to sell or retain the business. The decision is not an easy one. If your business has experienced growth, if you’ve brought a family member into the business, or if you are approaching retirement, it makes sense to revisit your business succession plan.


A tune-up can be as painless as an oil change for your car, or it can uncover some major work. But the benefit of a tune-up is that it puts you in control and minimizes the chance of getting stranded on a lonely road at night. A financial tune-up offers the same benefit—it prevents you from getting stranded without adequate retirement benefits, attractive employee benefits, or an up-to-date business succession plan.


This article provides general information for the subject matter covered.  It is not intended to render legal or tax advice.  An individual’s particular circumstances should be discussed with a personal tax or legal advisor. The Prudential Insurance Company of America, 751 Broad Street, Newark, NJ  07102-3777.


0192411-00001-00, Ed 07/22/2014, Exp 01/08/2016


Provided courtesy of Prudential.  For more information, contact Francis Piccirillo, a Financial Professional Associate with The Prudential Insurance Company of America’s South Jersey Financial Group.  He can be reached at (732) 202-4079.

Mercedes Concept Car at the Consumer Electronics Show in Las Vegas

Mercedes made clear it’s concept of where transportation and technology meet. The F 015 is the equivalent to a mobile living room boasting state of the art amenities while you travel, Mercedes is making a statement about how as we travel, of wanting to stay connected, productive, all while maintaining a sense of luxury during travel. Plus, it is pretty amazing, point blank.



“The car is growing beyond its role as a mere means of transport and will ultimately become a mobile living space.”

Head of Mercedes-Benz Dieter Zetsche.