Creatively Financing Your Business Opportunity

A Home Business Article Contributed by Barbara Gibson

Creatively Financing Your Business Opportunity

If you plan to take advantage of a business opportunity, you are probably wondering how it will be financed. Sources that come to mind immediately are business loans and personal savings. Although popular options, they are not available to everyone for a variety of reasons. Among these are high unemployment rates that have caused many of us to tap into our savings, or pay bills late. If you have been denied a loan, you have a right to request a free copy of your credit report.

Review your report carefully to make sure that the information it contains is correct. If you discover errors, you must dispute them in writing If the negative information is correct, call or write the creditors immediately to address the problem. Ignoring it will not make it go away. If you are among those for whom these options are not available, you can still seize your opportunity by financing creatively. One option is bartering. Can you trade products or services to raise needed capital?

Take a look at your budget. Are there expenses that you can eliminate? If you are having trouble getting a clear picture of how you spend all of your money, keep a spending log for a few days. You will be surprised at how quickly morning coffee stops and afternoon vending machine treats add up. As anxious as you probably are, the next suggestion may be difficult to accept, but it is still worth considering.

You could also postpone capitalizing on your business opportunity until you raise the needed capital. Or, if possible, consider an aspect of your business opportunity that requires little or no money up front.

Using Personal Resources for Your Business Opportunity

You may be one of the fortunate ones that has the personal resources to finance your business opportunity. Resources to consider are life insurance policies you can borrow from, retirement accounts, stocks, bonds, or savings accounts. It would be wise to consult your tax or financial advisor before you tap into these resources. There may be implications you cannot anticipate that will lead to regret later

Of course, you will also need specific information on anticipated expenses you will incur with your business opportunity. You should be sure before you spend any money that you will have enough to meet your needs. If not, you may find yourself with an empty bank account and a business that cannot go forward because of inadequate funding.

Enlisting Family and Friends to Support Your Business Opportunity

If your business opportunity generates enthusiasm and confidence among friends and family, they might be willing to offer financial support for your venture. We have all heard admonitions about borrowing from friends or family but, it need not be a painful experience. Before you accept any support for your business opportunity sit down together to write a very clear contract that outlines responsibilities, expectations, and repayment timelines. You should also discuss worst case scenarios.

How will you handle your inability to repay borrowed funds. How will the financial loss affect your friend or family member and your relationship? Talking about these things in the beginning will prevent trouble in the end.