If you run a small business or are an entrepreneur, you need to know ways of protecting your assets both online and offline. Minimizing business risk is essential.
Online, cybersecurity threats are increasing in number and sophistication. Offline, you need to have firm divisions in place between your business and your personal assets. Think of both as virtual firewalls against potential attacks from the outside.
Protecting Assets Online
There are a number of ways to protect your assets online.
1. Set up optimal cybersecurity software
Make sure you have antivirus and anti-spyware in place. Encrypt hard drives. Make sure your wireless network is secure. This is all very basic advice, but sometimes it’s neglected by nimble small businesses. If cybersecurity isn’t set up properly, you are a sitting duck for cybertheft ranging from ransomware to capture of proprietary company data on hard drives.
2. Follow good security practices with passwords
Follow good security practices. Passwords are a first line of defense, so institute policies on them. Mandate secure passwords and frequent changes. Every three months, employees should be required to institute new passwords. The most secure passwords are those that combine letters, numbers and special characters. Remember that passwords referring to spouse’s names, birthdays or other significant personal dates are easily hacked. Caution employees never to use the incredibly hackable “password” or “12345” as their sign-in. And never use them yourself!
3. Guard the computers
While cyber attacks happen through wireless networks, don’t neglect your need to protect computers themselves. Never allow employees to use their personal computers for sensitive company or customer data, even if you’re the smallest of start-ups. You need sensitive data stored on a company computer system. If your employees use company laptops, have a system for signing them in and out. It’s also a good idea to lock them up at night. Why? Unfortunately, the size of laptops make them a tempting target for theft.
4. Set up information technology support
As your business grows, you will likely need specialized IT support. If you are a solopreneur or small business, contract with outside IT providers until you need in-house people. They can monitor your system to ensure optimal security practices. They also back up data in case of breaches and outages, advise on security practices and keep up to date on specific threats.
Protecting Assets Offline
Protecting offline assets means protecting the assets of both your business and your personal assets. The following are good practices.
1. Separate your personal assets from business assets
If you are a solopreneur or small business, your personal assets should be separated from your business assets. The principal reason is potential liability. If someone injures themselves on your business property, for example, or brings a claim of any type against the business, your personal assets such as bank accounts, investments and home can be the target of the lawsuit. Even if you think a legal action is highly unlikely, it is prudent to protect your personal assets. Setting up an S Corp or a Limited Liability Corporation (LLC) means the business is a separate entity, and your personal assets cannot be targeted.
2. Maintain meticulous records for your corporation
If you do set up a corporation, make sure the records you keep are meticulous and separate from your personal accounts. A business needs, for example, a separate bank account. The financial statements need to be kept separate from any personal income or draw from the business. This can be a significant transition if you’ve been a solopreneur whose personal account was also your business account. But be aware that the drawing up of S Corporation or LLC papers does not end the responsibility to separate.
3. Purchase business insurance
Insurance is another very basic way to protect your assets. Make sure you have a business policy. It should cover theft, fire and flood if appropriate. If you’re in a business that exposes you to liability, you likely should have liability insurance. If there are company vehicles, they need to be insured as well. Consider an umbrella policy that will cover both your personal and business needs. These can be cheaper than separate accounts.
4. Consult with professionals
It’s never wise to go it alone as you embark upon or grow a business. Accounting and legal advice can both be invaluable. They are ways to protect your assets that might not be obvious at first but can repay the effort. Accountants, for example, can give advice on reducing your taxes that affect when and where you will purchase needed equipment. Lawyers can protect your assets in multiple ways. Make every effort to build a team of reliable professionals that can advise you for years to come.
In today’s world, protecting your assets both online and offline is imperative. Follow these tips for solid protection in both the virtual and real worlds.