{"id":454,"date":"2021-08-02T15:20:59","date_gmt":"2021-08-02T19:20:59","guid":{"rendered":"https:\/\/fluentricciardi.com\/?p=454"},"modified":"2022-01-26T15:21:55","modified_gmt":"2022-01-26T19:21:55","slug":"how-to-launch-an-online-business-without-dipping-into-your-savings","status":"publish","type":"post","link":"https:\/\/fluentricciardi.com\/how-to-launch-an-online-business-without-dipping-into-your-savings\/","title":{"rendered":"How to Launch an Online Business Without Dipping Into Your Savings"},"content":{"rendered":"

Many ambitious entrepreneurs launch an online business using their own funds. They use personal savings or max out credit cards. Tactics like these are even lauded. You can find many articles on the internet that encourage entrepreneurs to do whatever it takes to launch their business online. Entrepreneurs who\u00a0\u201crisk it all\u201d are called brave and\u00a0\u201chungry.\u201d But don\u2019t rush to take advice that puts your own financial security on the line. Instead, run through the ideas outlined below for launching an online business. There are more reasonable ways to get your online business up and running that don\u2019t require such a huge\u00a0financial risk\u00a0for you and your family.<\/p>\n

<\/p>\n

The Risks of Dipping Into Savings For Your Online Business<\/strong><\/p>\n

Using savings and personal credit cards to launch your business is fraught with peril. This kind of action carries significant\u2014and unneeded\u2014risk.<\/p>\n

You Could Lose It All<\/p>\n

What if your business fails and you lose all that savings? That will set you back many years on whatever you might have been saving for. Was it retirement? You could end up working many more years; well into your feeble old age. Was it your child\u2019s education? You might have to rely on student loans or scholarships. Was it savings for a down payment on a house? You could be looking at another whole decade of renting.<\/p>\n

You\u2019ll Incur Significant Penalties<\/p>\n

If the savings money is coming out of your official retirement account, like a 401k, you\u2019re going to incur substantial penalties for early withdrawal. If you\u2019re unsure just how much money in penalties you\u2019d have to pay, consult with your CPA. Estimates are typically around 40%, though. That\u2019s a hefty price to pay. Too hefty.<\/p>\n

Your Business Could Take Longer to Show a Profit<\/p>\n

If you\u2019re like most people., you\u2019re probably underestimating just how long it could take you to see a profit from your online business. Some people\u2014the lucky ones\u2014see a profit after one year. Others don\u2019t see a dime of profit for several years. Meanwhile, all that time you\u2019ll be paying interest on your credit cards if that\u2019s what you used. And you\u2019ll be forfeiting investment opportunities on the savings account you depleted.<\/p>\n

Now that we\u2019ve excluded the unwise option of using your personal savings or credit cards to launch your online business, what are the alternatives?<\/p>\n

Leverage Crowdfunding<\/strong><\/p>\n

If your online business idea is innovative or unique, leverage the power of crowdfunding. Crowdfunding platforms like Kickstarter have helped launch hundreds of successful online businesses. According to Kickstarter, successful campaigns include video, heavily descriptive text and widespread circulation on social media platforms. Every single one of those aspects would be free for you to implement and don\u2019t require technical knowledge. Kickstarter isn\u2019t the only crowdfunding site either, and you can launch multiple campaigns simultaneously. Try Indiegogo and Patreon, as well as others.<\/p>\n

Take Advantage of Free Trials<\/strong><\/p>\n

Most companies offering business tools have free trial periods that you can take advantage of. This trial period gives you a free pass to avail of the services at no charge while you get your online business up and running. Free trials typically run from seven days to 30 days; some require a credit card to register and others just stop working after the trial period or revoke your right to entry onto their site. If you use a trial period that requires your credit card, be sure to mark the trial expiration date in your calendar\u00a0the day before<\/i>, so you have time to choose to go ahead or to cancel the subscription before you get charged. Some especially valuable sites that offer online business tools with free trial periods include:<\/p>\n

\u2022\u00a0\u00a0\u00a0\u00a0Shopify – Offers business websites with templates, hosting, online payment support and much more. You could use this to create and launch your online website.<\/p>\n

\u2022\u00a0\u00a0\u00a0\u00a0Adobe Stock – Offers a free trial with 10 free images within 30 days. You could use this to create beautiful marketing materials for your online business.<\/p>\n

\u2022\u00a0\u00a0\u00a0\u00a0SmartDraw – Powerful business tool to create professional flow chart diagrams, floor plans, and basically any other kind of diagram you might need to organize or market your new online business. Offers a seven day free trial period.<\/p>\n

\u2022\u00a0\u00a0\u00a0\u00a0Reception247 – Offers live person telephone answering for your business. Their free trial period of 14 days is long enough to test whether this service might be helpful for your business.<\/p>\n

We don\u2019t vouch for any of these specific sites. We simply offer them as examples of what you can accomplish by leveraging free trials instead of using up your own savings.<\/p>\n

Take on a Partner\/Investor<\/strong><\/p>\n

Be vocal about your intentions to launch an online business. You might just find a supporting partner or person willing to invest so you can mitigate your personal financial risk. Consider talking to your parents, in-laws, colleagues and friends. If you engage in an arrangement with someone with whom you are in a personal relationship, keep it formal with an official document such as a partnership agreement or promissory note. Your CPA can help you to source such documents and review the terms for clarity and accuracy. If you don\u2019t find anyone in your personal circle who wants to invest in your new business, widen it to include online angel investors through sites such as Gust.com. This is a platform that aims to connect entrepreneurs with interested investors. Always be sure to read the fine print before accepting funds from unknown sources.<\/p>\n

There are other, more creative ways to get your online business idea funded. The good news is that online businesses take far less seed money than brick and mortar stores. Make sure that you explore every other option before jeopardizing your financial security by depleting your personal savings or maxing out your credit cards. To order a complete review of your finances and available assets, consult with your CPA.<\/p>\n","protected":false},"excerpt":{"rendered":"

Many ambitious entrepreneurs launch an online business using their own funds. They use personal savings or max out credit cards. Tactics like these are even lauded. You can find many articles on the internet that encourage entrepreneurs to do whatever it takes to launch their business online. Entrepreneurs who\u00a0\u201crisk it all\u201d are called brave and\u00a0\u201chungry.\u201d […]<\/p>\n","protected":false},"author":6,"featured_media":455,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[],"yoast_head":"\nHow to Launch an Online Business Without Dipping Into Your Savings - Fluent & Ricciardi<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/fluentricciardi.com\/how-to-launch-an-online-business-without-dipping-into-your-savings\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"How to Launch an Online Business Without Dipping Into Your Savings - Fluent & Ricciardi\" \/>\n<meta property=\"og:description\" content=\"Many ambitious entrepreneurs launch an online business using their own funds. 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