The Contractor’s Corner – How can I keep debt from sneaking up on me?
Abstract: This issue’s “Contractor’s Corner” looks at the dilemma of a contractor who worries about encroaching debt even when work is plentiful. Construction businesses are particularly sensitive to cash flow fluctuations, so giving up too much flexibility to debt could really hurt. This article explains how contractors need to prioritize debt, paying particular attention to their debt-to-equity ratio. It also discusses options to bankruptcy when debt becomes overwhelming.