You’ve had that idea rolling around in your mind for some time. Any time you have mentioned it to a friend; you are told that you should take that idea and start your own business. And yet, for some reason, taking the next step has you paralyzed with fear.
According to the United States Census Bureau, more than 500,000 new businesses are started each month. Almost the same numbers are closed, which leads one to believe that the success rate of new businesses is extremely low.
Key to Success
The fact remains that people still do start new businesses and some of them lead to success. Rather than deter you from your dream, the statistics should encourage you to find out the key to being one of the few rather than one of the many that fail.
You will need money to get started in your new business, and that will most likely come in the form of a personal loan or a small business loan.
Depending on the type of business you plan to create, it can cost less than $1000 or more than $10,000 just to get started. Unless you have saved up a lot of money, you will need funding.
As the article, “6 Tips for Getting Your Personal Loan Approved”, states, you must know how much you need. You don’t want to ask for too much, but you also don’t want to underestimate or you will be without much needed cash.
Getting the Money You Need
So, now you know that having enough money is essential to starting any business. To determine that magic number, you must develop a business plan. This plan will prove to lenders that you are serious about your business and you are prepared. It also helps you know what you need to do to ensure that you are one of the success stories.
You will also need to have good credit and find the right lender. It is also important that you consider your debt-to-income ratio or in your case, revenue vs. expenses since you will be responsible for paying back the loan.
Your personal credit history will play a significant part in getting approved since the business doesn’t have a history. Work to make your chances of approval greater by planning ahead. In fact, if your credit is a little shaky, it might pay to stay at that dead-end job just a little longer until it improves and you save money or pay off debt.
It also doesn’t hurt to talk to a lender even before you are ready to take that next step into the world of startups. He or she can give you solid advice and help you know what to expect.
Starting a new business is never easy, but it is possible to be successful in any economy.
Now is the right time if it is right for you.
About the Author: Joyce Morse is an author who writes on a variety of topics, including business and finance.