4/25/2005

Advice from Nashville's leading Financial Aid Advisor Dave Ramsey

 
Dave Says
By Dave Ramsey
Author of:
Financial Peace and
The Total Money Makeover

"10% owner in family business has questions?"

Dear Dave,

I work with my parents in a family-owned business, which is a corporation. I’m a 10% owner. I’m trying to do the things you recommend financially and they don’t agree. I’m wondering if I should just have my name taken off of the business.

Josh in Big Rapids, MI



Dear Josh,

As long as you’re not personally signing for anything, you won’t be liable personally for any of their financial decisions. For instance, if they go run up a bunch of debt on the company, it won’t come back on you financially except that you might lose your 10% interest in the company.

I think the real question here is whether this is where you want to invest the next 10-20 years of your life before you become the guy in control and can make the decisions to do things your way. Do you want to keep having these discussions with them over and over again for the next 10 years, because you’re not in a position to really do anything about it right now? It kind of sounds like that’s not the case, but I would recommend you take some more time to think about it and discuss it openly with your parents. Let them know that this is a big concern for you.

-Dave

More About Dave
Dave Says Articles
Dave Ramsey History
Dave Ramsey.com