Are you the one of those who aspires to start your own business and now just work as an employee for the rest of your life.But the hard fact is not all the business plans excel instantly , some take months or even years to actually turn profitable and get you good returns to excel further and also serve others.
So a startup entrepreneur ought to ensure a means of startup funding and simultaneously save enough amount to support all the expenses until the time his or her business plan turn profitable and in turn can provide appreciable remuneration.
Here are five crucial steps to keep in mind to become financially ready to start your own business.
1) CALCULATE START UP COST
It’s very important to be well aware of the startup cost of your business plan. One ought to calculate it with utmost efficiency analyzing all the factors as it may vary dramatically over the type of business , its location , resources etc.
Determining your startup cost enables you to decide whether you can afford to go with your business plan or you would have to opt out which is very much practical to ensure that you do not fail in any case .
2) DETERMINING LIVING EXPENSES
Handling the cost expenses of launching and operating your business plan efficiently is very much important but with that it’s even more important that it does affect your personal life and the expenses associated with the same .
At such a stage you should have saved an amount to support your expenses at least for 6 months.
3) BUILD YOUR CREDITS
Each and every business plan require a pity amount or handsome before it actually takes off. So one need to plan accordingly whether they can afford the same even after leaving their job or would it be efficient continuing and simultaneously working on the business.
Or would it be even better if they wait till they save enough ?
But then why not prefer keeping their house as a collateral or even preferring lending money from venture capital companies, angel investors, government loans , even crowdfunding rather than banks .
It all differs from person to person and also to the business type they prefer. But it is ver much important to decide upon the same.
4) CONSIDER YOU TAX BURDEN
If in case you are one of them who has been working as an employee for long you would surely be unaware of the tax expenses associated with self-employment and with it the federal and state income taxes.
So one need to analyze those facts as well and save enough to pay for the tax implications imposed.
5) ASSESS YOUR PROSPECTS
Starting up your own business is an exciting but tedious job. The very idea of being your own boss seems so soothing that many startup entrepreneurs fail to assess some important facts that as the startup cost varies on the type, resource and location so do the profit vary greatly . And one needs to accept that very fact before stepping into it .
Watch out video :Business Plan Tool