updated 5/17/2006 5:59:59 PM ET 2006-05-17T21:59:59

Personal finances often get a low priority from an entrepreneur who's trying to build a small business. If the choice is between investing in a new company's future and saving for rainy days or retirement, the business usually wins out.

"I felt like really to make a go of it, I had to put my eggs into my business basket," said Scott Tanner, who started Millennium Media Consulting, an Alexandria, Va.-based marketing business, four years ago.

Tanner did what many new business owners do — he cashed out his savings and dipped into credit cards. So putting money aside for his own future just wasn't part of the equation.

But Tanner said he's aware that many people, including financial advisers, wouldn't recommend that approach. And now, four years later, he is working on his personal balance sheet, paying down debt and recently buying a home.

"I'm not totally neglecting it," he said of his finances. "It's just not the centerpiece I'd like it to be."

Michelle Tennant, a co-owner of Wasabi Publicity Inc. in Asheville, N.C., also was more focused on building a business than on setting aside money for the future.

"I think I kept saying to myself, 'some day that will be a priority,'" Tennant said.

"We were making sure the company has enough in reserve to pay our staff, which is a typical small business thing," she said. Tennant was intent on self-funding Wasabi, now five years old, rather than taking on debt, and was also setting money aside for expansion.

Several people, including Tennant's personal finance-savvy business partner and a financial adviser, helped her see that she needed to rethink her priorities. She's now putting aside 10 percent of everything she earns for her own future.

"I know how to make a profit in business," she said. "I felt it was time to finally put my personal money to work, too."

Tennant was serious enough about her personal finances that she bought books and gathered as much information as possible so she could make the best investment choices.

There are several common reasons why many small business owners don't make a similar commitment to their personal finances. Some are afraid to divert money away from the company, fearing the business will suffer — although even a small amount of money put into a 401(k) account or other investment vehicle will grow exponentially over the years, and that money isn't likely to seal a struggling company's fate.

Many optimistically expect the company to take care of them financially one day. That shortsighted approach could be a big mistake, because a downturn in business — or worse, a complete collapse — could leave an owner with very little in the way of money or assets.

Owners often overlook the fact that the solution to the problem could be in the business itself — creating a retirement account for themselves and their employees. Setting up even the simplest of plans, known as a Simplified Employee Pension, or SEP, could actually help the company, giving it a tax break, and making the business more attractive to prospective employees.

Building up personal finances can also help a business owner get a little peace of mind — not a bad commodity to have amid the stresses of running a young company.

Susan Boucher has made her personal finances a priority since she and her husband Dan founded their guitar sales business, which is now in its third year. She had savings, including a 401(k) from a previous job and certificates of deposit, and while they dipped into some of their funds to start Premier Music Services, they are leaving much of their money intact. Boucher said they're holding the money for big personal expenses such as their home and college tuition.

"We put it away where we couldn't touch it," Boucher said.

They're also saving whatever they can out of what they earn from the Boylston, Mass.-based business, and from public relations work Boucher also does. "We pay bills and then we put the rest back in, and then put aside some when we can," she said.

There's plenty of help available for small business owners who decide to start working on their personal finances. Your first stop should probably be your accountant's office; he or she can help you go over your business and be sure you're maximizing your profits. Once that's done, your accountant or a financial adviser can help you determine what's the best way for you to save.

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