If you’re not independently wealthy, you’re going to need to find some
money for starting your stay at home business. You may not need a lot, so
we’re going to start with simple ways to get money and then work our way
up to the more complicated routes.
Okay, so the easiest way to get money for your small business is to already
have it on hand. Look in you savings or investments to see if there is any
money that can be taken from there for a time. Many small business owners
start their initial funds with credit card purchases, but this is not
recommended. Credit is a slippery slope for any venture unless carefully
The interest rates can catch up with you more quickly than your profits may.
On the other hand, there’s always borrowing money from family and friends.
This can be sticky, so draw up an agreement like you would for any other
sum of money, including repayment terms with interest. Of course, if your
friends or family do not want to be repaid, you can always offer them a part
of your business to share in any profits that you may gather.
The bonus to these kinds of loans is that you’re not going to fall into financial
troubles if a payment is late and the interest rates are usually much lower
than at banks.
But banks and credit unions are the places to go for larger small business
loans. They will look at your business plan to see if it’s possible for them to
be paid back in a timely fashion and then open up a business account for you
to draw finds from. The trick with banks and credit unions is that they look
at your past credit history to determine the interest rate for you.
Other sources for funds include Angel investors and Venture capital firms.
These are places that specialize in helping small businesses with their growth
by offering a partial ownership. You would look in your local phone book
under small business investment firms.
The downside of this method is that you’re getting yourself into the corporate
scene again and you will have to answer to the other company should your
Whichever method you choose, realize that you will have to make your
business succeed in order to repay these funds. That thought can be
incentive enough to do well.
FACTORING IN YOUR PERSONAL LIFE
As much as you try to separate the two, your personal life and your business
life will have to come together during the planning stage.
When you’re considering starting a business venture, you will need to see
what kinds of profits you can expect and what money you can expect to not
have during the beginning phases. Within your personal life, you need to be
ready for both.
It helps to start a household budget prior to your business venture in order
to become accustomed to living a certain way so that any disruption in the
finances is not catastrophic to your family. You may also want to factor in a
savings plan so that you can have a little cushion to fall back on.
Start with the budget as you would with a business budget. What do you
make every month and what do you spend? What expenses can you cut
back on or cut out entirely? And what bills are necessary?
Sit down with your family and decide what money from your savings will be
available for emergencies and what you will do if your business is not
Though if you make your primary income your business, then you’ll do
anything to make sure that it succeeds—nothing like a little pressure.
Like a diet for your finances, make sure to include some ‘cheat’ expenses.
These are the fun things that you family likes to enjoy and should still enjoy
even if you’re working too hard to join them.
You will also want to look into your credit report to see if there are any
blemishes that should not be there. According to a new law, everyone is able
to receive a free credit report each year to check for any fraudulent activity.
What you may not know is that your personal credit is what banks and credit
unions check prior to approving a loan, so you’ll want to clean up anything
that will hinder your chances.
You will also want to examine the debt that you already have in your family
to see if you can get that down before starting your new business. There’s
no sense in adding debt to debt if you don’t have to.
You want to have your finances in as much order as you can so that you’re
not adding undue stress to your business venture.
A new business should not be a painful journey, and it doesn’t have to be
with a little planning.