Financial Considerations for Owner Operators
Part 2: Financial considerations of becoming an owner operator
Keeping a strongly health cash flow and good financial situation will help tremendously in your owner operator success. The following are some financial considerations to becoming and owner operator.
• Do not carry too much debt. Carrying around extra credit card debt will do two things: increase the pressure on your new business and make it more difficult to borrow money for your business. Try to pay off as much as you are able to each month, and avoid charging on credit cards.
• Establish an emergency fund. Successful owner operators will agree – having an emergency fund is crucial for success. Emergencies will come up, and having the cash on hand to afford them will save trouble and keep your business running.
• Maintain a good credit rating. Having good credit gives you access to better rates on truck loans and fuel cards, potentially saving you thousands of dollars.
• Carry life insurance. Life insurance will protect your assets and family, and can be very affordable. Term life insurance policies are very affordable, especially for young healthy individuals.
• Buy disability insurance. Disability insurance kicks in when you are unable to work due to an accident or illness. This will provide cash for living expenses and your truck payment when you are off work because of an injury.
A solid financial situation will greatly improve your success as an owner operator.
Read the first article in the series - Owner Operator Personality Traits
Read the third article in the series - Equipment Selection for Owner Operators
Read the fourth article in the series - Business Considerations for Owner Operators