Got a surefire business idea that could really be something if you just had a couple of grand to throw at it? Lots of people do – and that’s where their dream dies. But your startup idea doesn’t have to die.
You’ll never regret taking a leap when it comes to growing your small business – but that doesn’t mean you shouldn’t have a safety net. Want to make sure you have enough funding to make your vision a reality?
These are five reasons to get a small business loan for your startup company and start off on the right foot.
1) Loans Don’t Have to Be Huge Debt
If one of the reasons you are resistant to getting a small business loan is because you think it will require you to take a large amount, think again. Small business loans are available even for a small company that just needs a few thousand dollars to get off the ground.
2) Sure Source of Startup Capital
It can be tempting to run full-tilt into an exciting new idea. However, when it comes to business it’s important to temper passion with logic. Every solid business needs a plan for execution, management, and financing. If you want a sure source of startup capital, a loan for your business is one of several things to consider.
If you begin a business with no budget or certain cash flow to get it off the ground, it will likely never go far. However, if you are prepared, you increase your chances for your own success.
3) Interest Rates May Be Better Than Your Credit Card
Small business loans from banks can have interest rates as low as 4%. If your other option for financing your startup is to put it on your credit card, you are likely facing significantly higher interest rates, closer to 12-24%.
4) The Interest Is Tax-Deductible
Some small business loans give you the option to take a tax deduction for the amount of interest you paid on the loan. This can be a pretty big chunk of savings, particularly compared to other personal financing options that don’t permit a tax deduction.
5) Growth Costs Before It Profits
If you’ve got a startup that’s been underway for a while but you are looking to increase its growth, get a small business loan. Whether you are pushing into a new territory or moving to a larger headquarters, the cost of investing in this growth will no doubt take up a lot of your cash flow.
Seek financing through a loan to cover the cost of the expansion while you wait for increased profits.
Be the Entrepreneur You Want to Be with a Loan
Take your startup company and make it into something thriving that will survive the storms of early years in business when you have a solid financing plan and the capital to back it. When you borrow intelligently and responsibly, you make new opportunities for your small business to flourish.
Check out our other articles about opportunities for small businesses and startups.