It starts with a roadmap for your overall venture and how you plan on bringing your idea to life. A well-constructed business plan enables you to forecast your potential earnings, expenses and profitability. It also enhances your credibility with potential creditors and investors should you need funds. And it’s critical when discussing your venture with other advisors.
Before leaving a secure job for your new self-employed business, think through how things might change for you, both personally and financially. In other words, crunch the numbers.
Calculate how much money you'll need to launch your business and keep it running for 12 to 24 months
Analyze your personal finances to make sure your necessary living expenses will be covered until your business becomes profitable
Look at sales and booked receivables to ensure you can meet payroll and other fixed expenses
Regularly compare your actual revenues and expenses to your original forecasts
Find an attorney who specializes in start-ups, a tax advisor seasoned in analysis and planning and an insurance advisor who can help protect you from liability. We can help you expand your network and make important connections.
The kind of business entity you choose impacts many things, including control, legal liability and taxation. Your advisory team can play a key role in helping you choose the entity and structure that's right for you. These are the most common.
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