“Wisdom for Wealth. For Life.” Episode 48: Sometimes It’s Personal, Sometimes It’s Business: How to Separate Family Money from Business Money

Key Takeaways:

• Without clear, documented objectives, it’s impossible to make strategic decisions about how resources should flow between business and personal finances.
• Creating intentional boundaries between business money and family money can help owners ensure each dollar has a defined purpose aligned with their overall financial strategy.
• Knowing how much is enough helps determine whether you’re building a lifestyle business or planning an exit, which directly impacts future decisions.

Business ownership is rewarding but often complicated. Many entrepreneurs who excel at managing complex operations, employees, and growth strategies often struggle to separate their business and personal finances. The very skills that make them successful at business—seeing opportunities where others see challenges, taking calculated risks, viewing all assets as potential resources—can create blind spots in their personal financial management.

Blue Trust advisor Stephanie Adams sat down with a managing director and senior partner from Blue Trust, Greg Gilbert, to discuss the financial complexity that comes with business ownership. During their conversation, the two discussed how business owners can simultaneously achieve peace of mind, family harmony, and the ability to make wise stewardship decisions with the resources God has entrusted to them.

The Unique Challenge of Business Owners’ Finances

While everyone can benefit from financial counsel, business owners face added complexity―managing both personal finances and a separate entity with its own growth trajectory, employee responsibilities, and financial obligations.

The challenge becomes even more involved when seasonal cash flow, varying income streams, and tax planning enter the picture. Unlike salaried employees who receive consistent paychecks, business owners often deal with distributions, bonuses, and variable income that may not arrive evenly throughout the year.

Greg Gilbert explains what he has seen happen: “Sometimes, as a business owner, you go to the personal finances if the business needs money. Or if you’re making personal decisions, [it may be hard to know] what are wise decisions, not knowing what the business may or may not be able to do.”

The unpredictable nature of business income can create tension in marriages, particularly around cash flow management. Consider these strategies to help you address this unpredictability and bring clarity to your financial decision-making.

Start with Written Financial Goals

Before addressing the tactical aspects of separating business and personal finances, it’s critical to recognize the foundational importance of written financial goals. Stephanie Adams shares, “More often than not, people have these goals that are kind of in their minds and floating around. But writing it down and having something to anchor back to when there are decisions to be made is really important.”

For married couples, this process becomes even more critical. Clearly written, shared goals provide a framework for decisions that affect both business and personal finances. They also help couples navigate different perspectives―particularly around risk tolerance and cash reserves.

Business owners need to take time regularly to assess their finances. Without intentional evaluation, it’s easy to let important decisions drift or become reactive rather than strategic.

Here are several key questions to ask as you’re writing out your goals:

• Cash flow management: Are you effectively managing cash flow on both sides of the equation? This includes understanding payroll timing, retirement contributions, tax obligations, and the seasonal nature of your business income.
• Asset and liability allocation: How are you strategically thinking about debt across both your business and personal life? What’s the appropriate amount of leverage for your family to carry across both entities?
• Future planning: Are you on track for saving toward long-term goals? Without written objectives, it’s impossible to know whether you’re adequately preparing for the future.
• Risk management: What happens if you become incapacitated or pass away unexpectedly? Do you have proper succession planning for the business and protection for your family?
• Financial knowledge transfer: Is there someone who has a full understanding of your financial situation who could help your spouse or business stakeholders in the event of your absence?

One of the most crucial questions business owners must answer is what Greg calls the “financial finish line” question: How much is enough? This question helps determine whether you’re building a lifestyle business or planning for an eventual exit, and how that translates into your family’s long-term financial independence.

Without knowing your finish line, it becomes difficult to make informed decisions about how much to reinvest in the business versus how much to diversify into other assets for family security.

Establish a Solid Foundation

Both Greg and Stephanie emphasize starting with biblical principles when establishing financial goals. Greg encourages clients to go to God first. “What does God’s Word have to say, what are the roles of your life, and what does it look like to honor Him in the midst of those roles?” he asked.

This spiritual foundation helps families align on goals that reflect their values rather than simply financial targets. “If everybody starts there, then we’re seeking His ways and letting Him direct our steps,” Greg said.

Grounding your financial goals in biblical wisdom provides a steady foundation, making future decisions clearer and more purposeful.

Creating Healthy Boundaries

The key to untangling personal and business financial decisions lies in establishing clear boundaries between the two. This doesn’t mean they exist in isolation—after all, business success ultimately supports family goals—but rather that each has its own defined purpose and limits.

Greg shared an example of a couple who had very different perspectives on using a home equity line of credit (HELOC) to pay a business tax bill. While the husband viewed all their assets as one interconnected system, the wife saw clear distinctions between their home, emergency savings, and business obligations. Both perspectives had merit, but the lack of clear boundaries created unnecessary stress and potential conflict.

Successfully separating family wealth from business assets isn’t about building rigid walls between them. Instead, it’s about intentionally managing how resources flow between the two, ensuring every decision aligns with your written goals and biblical values.

Moving Forward with Intention

For business owners overwhelmed by the complexity of managing money at work and at home, the first step is often the most important―acknowledging that everyone needs financial guidance and seeking counsel from professionals who understand the unique challenges entrepreneurs face.

What business owners often lack is someone to coordinate the multiple professionals in their lives, including CPAs, bookkeepers, CFOs, insurance agents, estate planning lawyers, and business attorneys. This coordination becomes extremely important when making decisions that affect both business and personal finances, such as:

• Tax planning strategies that involve both entities
• Estate planning that includes business succession
• Insurance needs to protect both business operations and family security
• Investment strategies that balance business growth with personal diversification

A financial advisor is frequently the right person to coordinate these various professionals. They can also facilitate regular reviews to make sure your plan is always evolving to meet shifting needs due to business growth or life changes. After all, “Life is always throwing changes, adjustments, and surprises at us,” Greg said. The value of good planning isn’t that it prevents surprises, but that it helps you make wise decisions when surprises inevitably occur.

The goal is for business owners “to feel free to make decisions that have eternal impact with what God’s given them in the temporal realm,” Stephanie said. When family money and business money each have their proper place and purpose, business owners can focus on what matters most: faithful stewardship of the resources entrusted to their care.

Related Resources:

• Preserving the Legacy of Your Business
• Determining Purpose: Developing a Business Generosity Plan
• What Makes a Business Valuable?