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Investments to Think About When Starting Your Own Small Business
Starting a business, even a small one, is a huge undertaking. There are certain investments that it would be wise to consider when you make the jump from employer to owner.
General Liability Insurance
General Liability Insurance covers any costs incurred if something happens to you and you are not able to run your business for a certain period of time. It also covers damage your business may cause to another business’s property and may even pay your court costs if your business ends up being sued. General liability insurance will also protect you financially if your business’s products or services cause harm to someone else. This is a crucial type of insurance for any small business to have and an investment that you’d be wise to seriously consider making for your small business.
When preparing to start your small business, if you do not have access to the money you need for start-up, consider asking others to invest in your business. This could be anyone from former co-workers, teachers, friends or relatives; people who believe in you and the business you are working to launch. Often, getting individuals that know you to invest in your new business is easier than attempting to get a loan from a bank.
Worker’s Compensation Insurance
If you plan to hire employees for your business right away, a crucial investment is in worker’s compensation insurance. This protects your employees in the event they get sick or hurt as a direct result of their job. Without worker’s compensation insurance, the financial burden might fall on you if an employee gets sick or injured. An absence of worker’s comp insurance could leave you responsible for your employees’ medical bills and open you up to a possible lawsuit from them.
Social Media Marketer
In today’s world, social media is one of the leading forms of advertising for any small business, but especially a new one. It is very important for your business to have a social media presence in order to start building up your reputation as quickly as possible. If creating and running social media websites for your business isn’t for you, you might want to think about investing in a social media marketer. Depending on what you can afford you can either hire a firm or hire a freelancer to do your social media for you. Either way, you will want to think about making this very important investment in your business’s future.
If you need some quick cash to help start your small business and you can’t acquire it any other way, you may need to consider temporarily investing in a payday loan. They are easier to get than bank loans, although you generally have to pay them back quicker. Due to sometimes exorbitant interest rates, this type of loan may be a last resort for some, but is an option in an emergency if you have no other access to quick cash.
When starting a small business, there is much that needs to be done. Add the tips above to your “to-do” list to make sure that you’ve got all bases covered in order to give your new small business the best chance of success.
Author Bio: Dave Smith is a financial blogger with a passion for frugality. He believes it is very important to have your research done before making any decisions regarding life investments
We plan on doing a lot of social media marketing in our new business, looking forward to it! 🙂
Can’t wait to hear all about this new venture, Michelle!
Good tips Laurie, though I don’t know I’d get a payday loan for a business. 🙂 We do social media marketing ourselves, though we do need to do more of it. One investment I would also add is look to something like forming an LLC or S Corp to try and shield your personal assets from potential issues.
I agree here – not a good option generally. I love your tip about forming an LLC or S Corp too. Best to keep personal assets out of the situation if at all possible!
I think John’s advice is sound. You should think about setting up a good business structure to keep yourself and your assets safe. I will be doing this this year hopefully.
I don’t agree with the payday loan. The interest rates are huge and they have to be paid back to quick. You wouldn’t be able to get the ROI necessary with a business because it takes so long to ramp up revenues.
I agree: it should totally be a last resort, as the guest author mentioned. Might not be a good idea to start a biz if you’re that financially strapped. I’ve been thinking about John’s comment about setting up a separate entity too.
Laurie, I agree that a LLC or S corp would be ideal to create, only costs about $500 or so. This will limit your liability, or at least create another barrier to protect your assets. Make sure that your liability names the LLC, either as the first named insured or as an additional insured!
Great advice, Jim – thank you!!!!
So many horror stories about payday loans, but I suppose emergencies require quick access to funds. Are there any alternatives you would suggest?
I guess having a small line of credit before you start, or credit card, on the off chance that you could get one for a new business. I for one think a good business start up requires a lot of up front planning so you can avoid things like payday loans in the first place, but I’m little on the paranoid side… 🙂
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