Family Finance

by Crown Financial Ministries

Starting a business

Starting and managing a business takes motivation, desire, talent, research and planning. Like a chess game, success in small business requires decisive and correct moves, so develop a plan.

1 Get started by listing your reasons for wanting to go into business.
2 Determine the type of business that is right for you, based on your talents, skills, time availability, and interests.
3 Identify the niche your business would fill.

4 Develop a pre-business check-list to answer questions about location, finances, insurance, equipment and supply needs, and legal structure.
5 Establish a budget, even if your idea is several years into the future. Be cautious about borrowing to start any new venture.
6 Never borrow against your home or retirement account. Don't deplete savings accounts, or cash in IRAs or cash savings bonds to fund new ventures. Debt makes it difficult for a new business to break even. If God wants you to develop this idea, He will provide a way to finance it without having to jeopardize your future.

examining an existing business

The success of a purchase depends on existing experience in that business and careful examination of the records and books. Auditing its finances is very important and would be worth the money an accountant may charge for this service.

Determining the value of a business is very difficult and what a business is actually worth seldom brings that price. In addition to property value (get three fair market appraisals) and the cost of inventory, the business worth should be about four times its net yearly earnings. After deducting your salary, a business should be able to pay itself off in 5 to 7 years. If it can't, it's probably overpriced and not a good buy.

Home based business

Before becoming involved with any home-based venture :

1) Get the names of the principals of the business opportunity and the home office of the company.

2) Contact the Better Business Bureau in the state where they are located and the attorney general or the state securities office of that state. Ask if any complaints have been filed against the company before you make any decision to become a part of that company.

This sort of checking for the purchase of any sort of business, is so very important if you want to avoid being caught with a questionable purchase, that could cost you so much more than you thought because of a lack of due diligence on your part.

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