When you have the itch to become your own boss, the idea of setting your own hours and having complete control over your career can be quite heady. But before you quit your job and plunge headfirst into your dreams, there are some grounding things you need to think about before you go whole hog.
Factor In Your Living Expenses
When you’re planning your business expenses down to the very last cent, you can’t forget one very important expense: paying yourself. You may not be an employee, but you still need to be paid, right? What’s the point of having your own business otherwise? As you’re planning everything out, take every single one of your living expenses into account. You’ll find that you need to cut out anything unnecessary and frivolous for a year or so. Make sure you plan a cushion; you can budget every penny, but if something unexpected comes up, you’re going to find yourself up the creek without a paddle. A financial planner might even suggest taking a part-time job to help cover your living expenses until your business picks up.
Is This the Right Time?
When you’re starting a business from scratch, you can expect to be working at least 60 hours a week for a couple of years. Are you at a point in your life where you can all but ditch your social and personal life and devote it solely to your business? If you have a young family, you might consider putting this endeavor off until your life is at a place where your family can spare you for 60 to 80 hours a week.
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Spend Money to Make Money
You’re going to feel like you’re bleeding money, but it’s important to know where you should be opening those purse strings a little bit. If you need to spend $10,000 to get a certain certification for your employees that could mean the difference between a couple of hundred dollars a month, you should do it. By no means should you skip out on things that your company is going to need. One place you absolutely shouldn’t skimp out on is a a good business attorney. According to Gilbert and Bourke, a business litigation attorney office, you need a good lawyer to help you make decisions that won’t create a huge hassle come tax season.
Assess Your Financing Options
While it’s best to have as much cash as possible to put into your business, sometimes it’s just not possible to have that much to get your business afloat. The most common small business loan offered by the Small Business Administration is a 7(a) loan. According to the SBA, eligibility are based on what the business does to generate its income and where the business actually operates. While the SBA doesn’t specifically say what businesses are eligible, it does outline what makes a business not eligible. Generally, a business is eligible if it operates for profit, does business in the US, has invested equity, has used alternative resources for financing (including personal assets), shows a need for the loan proceeds, and isn’t delinquent on any other debts to the U.S. government.
Owning a successful business can be one of the best feelings in the world. Not only did you overcome a slew of hurdles, you’re officially your own boss!