Getting Cash for your Small Business Through the CARES Act

Brian Thompson
JD/CFP® helping LGBTQ entrepreneurs thrive in business and in life.

 

Update: I’ve updated this piece to reflect the now functioning EIDL online application. I’ve also clarified the calculation for Paycheck Protection Program loan forgiveness.

As an advisor who supports small businesses and runs in a lot of small business circles, I’ve seen a lot of pain, fear, and anxiety these past few weeks. A lot of you are hurting and simply can’t find support right now. You’ve tried your best to prepare for slowdowns —  saved some emergency cash, got a line of credit, etc .— but you couldn’t have imagined going from 100 to 0 in a matter of hours, leaving you with a lot of bills to pay including rent and payroll.

The median business holds cash reserves to cover 27 days of expenses, according to Chase. But even if you’re well-prepared with a three- to six-month buffer for your business, you still need to plan for what happens if that runs out. No one knows how long this will last. What you need right now is cash.

The government has stepped up to help. But with three stimulus bills already passed, the last of which was 800 pages, it’s hard to know where to focus. Today, I’ll explain the main two ways your business can get cash now that the CARES Act is law. We’ll also discuss the steps you need to take to make sure you can get your money as efficiently as possible.

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