Five Key Investments Entrepreneurs And Small Business Owners Should Make

When small- and medium-sized business owners build a successful business, they get caught up in managing the daily activities of the business and forget about the investments they ought to be making. The company you started or run today isn’t the ultimate goal. It’s just a means to an end based on what you desire to achieve in life. What do you want? To have children, travel around the globe, or be a positive influence in other people’s lives? As you consider your business, consider taking a step back and thinking about your objectives and the following as the most important investments you have to make, both for your own company and yourself.

The business you run. At times, when you are starting your own business, you get overwhelmed by the daily operations of your business, and you neglect the most important investment you can make…in yourself. This can be as easy as obtaining a physical every year and a course at a local university and taking time to travel and enjoy. Another way to view yourself as an investment is to find ways to allow yourself more time. You can take a break, relax, get a massage, go for an exercise session or get together with your friends. Take a look at what you can “outsource” and build an equilibrist version of yourself that is healthy and content.

Your business requires an investment. Often, a small business owner or entrepreneur may manage the company too thin in their efforts to maximize or generate profits. Sometimes, it’s not so much about profit or revenue, but the costs you have to consider. Perhaps the investment in new technology results in more transactions or decreases the time an employee spends on the job. If you’re not able to generate the greatest return on investment for your business, then perhaps you should take a step back to examine ways to manage your company more effectively.

Tax accountants are your best friend. If you’re a successful business owner or small-scale entrepreneur, you may not know that the single most significant personal expense is a tax bill. By analyzing options to reduce their taxes, entrepreneurs can usually increase their net earnings up to 50 percent by making only a few adjustments to how they conduct their business and personal life. This more cash flow, when properly invested, could significantly impact your future. You might want to consider examining the place where your business is registered or look into the legal ownership of the business. It is also possible to determine if you have set up your company to be part of the Roth 401k. If so, will it generate tax-free dividends or permit investors to make investments tax-free throughout your life.

Diversify your real estate portfolio. Your company is doing well and providing solid cash flow to make more to purchase the Tesla. You can also expand your investment “platform” to invest in commercial real property, which can provide additional cash flow as well as tax advantages. I know several entrepreneurs who have constructed an investment portfolio of commercial properties that generate more than $250,000 annually in net cash flow. They see the worth of their property is increasing. Small offices, apartments, and warehouses are all able to offer a diverse real estate portfolio that can earn you a living if you require it.

It is advisable to invest wisely in the market for stocks. Meme stocks and the newest investment platforms such as Robinhood aren’t investing. It’s gambling. If you don’t plan to conduct a study and support up to three hours a day analyzing trends, markets, and companies, you shouldn’t be putting your money at risk. You’d be better off by investing equally with three or four market-wide index ETFs such as The Dow, S & P 500, NASDAQ, and maybe the Russell 2000 and let time and history take care of the rest. Based on Motley, The stock market has been up longer than it has fallen. The S&P 500 has raised in value over 40 of the 50 years and has generated an average return per year of 10.9 percent. If you take that return, the investment could increase by seven times a year. Without the hassle, headache, and risk that comes with investing in individual securities or betting.

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Samatha Vale
Samatha a senior writer for HC's entertainment team. She is an entreprenuer, mother and an excellent writer. She's also an avid reader, music enthusiast and all around inquisitive person - which is just a nice way of saying she's nosy.

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