Entrepreneurship is seemingly more popular than ever. The proliferation of the internet and connectivity has allowed for smaller companies to compete for their own piece of the pie in a set of expanding markets.
Whether someone has the next big invention for the kitchen, just developed an app that is going to revolutionize the parking industry, or has simply started their own cafe in a small town, there are a few financial steps that they should consider.
Before making any financial decisions, please be sure to contact your financial planner. The following five tips are meant as a starting point only.
1. Research as much as possible: This may go without saying, but jumping right into starting your own business without taking the proper steps to familiarize yourself with some of the basics can result in disaster and possible tax problems down the road. At the very least, consult with other business owners you may know. Contacting a financial advisor is one of the best moves you can make at this point.
2. Plan out your finances: Depending on the type of business someone is starting, there can be a lot of capital that may be needed to start it up. Knowing how much you need and where you can get it, through loans and other methods, is one of the most important steps you can take. Contacting a financial advisor can help you mitigate the amount of debt you may need to take on to make your dream a reality.
3. Track and monitor all of your spending from the get go: Running your own business is different than being an employee for a variety of reasons, and one of them is how you’re going to be filing your taxes. Whether your new business is an LLC or S Corp, you’ll want to be sure you track every single dime you’ve spent in order to maximize your allowable tax deductions.
4. Contact an insurance agent: Insurance may not be the first thing you’re thinking about when putting together your new business, but it may be one of the most important. If you already have a working relationship with an insurance agent, you can start there to get an idea of what you may or may not need to protect your new business assets.
5. Make clear goals: Without clear goals, you’re not going to have a good idea of where you are in your new business life. You may think things are going better than they are or you may not know how great you have it if you’re not able to check your progress against goals you set when you started. Of course, goals can be changed along the way. We recommend contacting a financial advisor to help you set realistic goals to light that fire!
Starting a business goes well beyond the five suggestions in this article. In fact, there are books and entire websites devoted to taking the plunge and everything that goes with it.
Contact Steel Valley Investment Group of Raymond James to inquire about your own journey.
Views expressed are not necessarily those of Raymond James & Associates and are subject to change without notice. Information contained herein was received from sources believed to be reliable, but accuracy is not guaranteed. Information provided is general in nature, and is not a complete statement of all information necessary for making an investment decision.