Former Federal Reserve Chairman Alan Greenspan told a House committee Thursday that the nation will emerge from the current credit crisis with a "far sounder financial system."

"We are in the midst of a once-in-a century credit tsunami," Greenspan told the House Oversight and Reform Committee in prepared testimony.

Greenspan said that whatever regulatory changes are made to respond to the crisis, "they will pale in comparison to the change already evident in today’s markets."

There is no question that the American public will face difficult times ahead. It is very important, especially for the small business owner and entrepreneur, to tighten their belts and focus in order for their business to survive!

The business owner must have the proper resources and information to know what to do strategically to obtain access to cash to grow their businesses. Here is a list of several items the business owner must do:

1.       Do not operate as a sole proprietorship. Since most sole proprietors self finance their own business they are ringing up their revolving debt. That alone will cause great difficulty when it comes to applying for a business credit card or business line of credit in the future after incorporating or forming an LLC. Incorporate on day one!

2.       Personally you must focus on getting on a comprehensive budget and paying down your credit card debt between 5-20%. That is the magic number to maximize your personal credit score!

3.       After you incorporate and have been in business 6-9 months if you need additional cash, a merchant account cash advance may be helpful, but be careful. You must have the right resource in this area or your business will have trouble!

4.       A home based business owner does not need a $50,000 trade line of credit at Home Depot®! They need cash! A brick and mortar business may be different. Make sure you are clear in what you are getting when others advertise “business credit”.

5.       Obtain a bank business credit card after you incorporate the business and look to obtain a business line of credit before the end of the first year. Make sure to show a profit in your business!

Credit Tsunami Video

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For more details on the best course to help you survive the credit tsunami and other objectives to obtain more cash for your business go to our business credit builder page.