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Affluent Business Owners Digging Deeper

If you’re affluent and own a small business, you may find yourself dipping into your own pockets to keep yourself afloat more often than other wealthy people, a new study shows.

Affluent small business owners struggle more with balancing financial demands in their personal life than the rest of the affluent population, the Merrill Lynch Affluent Insights Quarterly Survey shows.  In fact, a third (33 percent) have had to tap into their long-term savings and investments to meet immediate financial needs during the past year, compared with 18 percent of affluent individuals who do not own a small business.

One thousand affluent Americans with investable assets in excess of $250,000 were polled by Braun Research on behalf of Merrill Lynch Wealth Management. Included in this sample were 190 affluent small business owners. These are individuals who own a business that generates at least $1 million in revenue and had 250 employees or less.

Twice as many of them reported that they had spent more during the last year (32) percent and expect that their debt (24 percent) will increase in the year ahead than the non-business-owners in their cohort.

Nonetheless, the survey reported, they are hopeful about the future. The majority of affluent small business owners (56 percent) believe their business is in a better financial position today than it was a year ago. 

But they face challenges. More than two-thirds (69 percent) indicated they were not able to hire as many employees as their business needs, citing a “lack of business/revenue ” as the most common reason (32 percent).

More than a quarter (28 percent) of affluent small business owners said running their business was nearly as difficult as raising children (31 percent) and twice as challenging as maintaining a healthy marriage or domestic partnership (14 percent.)

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Reach BusinessNewsDaily senior writer Ned Smith at nsmith@techmedianetwork.com.  Follow him on twitter @nedbsmith .

Ned Smith

Ned was senior writer at Sweeney Vesty, an international consulting firm, and was Vice President of communications for iQuest Analytics. Before that, he has been a web editor and managed the Internet and intranet sites for Citizens Communications. He began his journalism career as a police reporter with the Roanoke (Va.) Times, and was managing editor of American Way magazine and senior editor of Us. He was a Captain in the U.S. Air Force and has a masters in journalism from the University of Arizona.