Turning your tax return into seed money

You’ve had a small business idea for quite some time, know the product or service you can market to the masses, but the financial aspect has always kept you from putting your big plans into motion. Hey — what about that tax return that’s about to hit your bank account?

Sure, you could buy yourself something nice or take yourself on a vacation. But what if you parlayed this little springtime financial windfall into something more substantial — something like investing in your small business ownership dreams?

Investing your tax return into a small business venture can be a great way to kick-start your entrepreneurial dreams. With the extra money, you can potentially take the initial steps to launch a business that could ultimately provide financial security and freedom.

It all starts with a plan

Creating a business plan is like drawing a roadmap for the journey your small business is about to experience. It acts as a guide, but also helps a potential lender understand how you’re going to turn a profit with the money they could potentially lend you. It’ll also help you stay on track once you start the business by continuing to stay on the road to success. A business without a solid business plan is risky and may not stand the test of time.

Once you have a solid business plan, you can determine how much money you’ll need to get started with your business venture. This is where your tax return comes in. Rather than using money from your return to splurge on non-essential items, you can put it toward your dreams of business ownership.

Investing your tax return can help you cover the initial costs of starting a business such as purchasing inventory, renting a space, paying for permits and licenses, and marketing expenses. Depending on the size of your return, it might also help you cushion your finances during the first few months of your business where you may not see a profit quite yet.

If your tax return doesn’t cover all the startup costs, a business loan could cover the rest. But being able to apply that funding toward the business will keep your loan repayment costs lower and give you breathing room as you get started.

Looking ahead

Investing in a small business venture has great potential for long-term growth and financial stability. Owning your own business can give you the freedom to be your own boss and make your own schedule. It can also provide a pathway to financial independence, allowing you to set your own income goals and work toward financial stability and security.

Your tax return is a great way to start your entrepreneurial journey. With careful planning and a solid business plan, you can use this extra money to fund your startup costs and potentially set yourself on a path to financial success and freedom. And our Small Business team is here to answer questions you might have about a business loan, so don’t hesitate to reach out with your questions.