If I had only $50,000 to start a new business and wanted to turn it into $150,000 or more quickly, but had poor personal credit, what steps could I take?
Truthfully, I’d prioritize becoming my own bank which allows for greater flexibility and autonomy in funding, making it a game-changer for startups. While unconventional, self-financing can provide the necessary control for success.
Imagine a world where you are the master of your own finances, where you control money and not the other way around. A world where you don't have to depend on financial institutions or worry about their whims.
A world where you are your own bank
This is not a mere fantasy, my friend. It is a goal that is well within your reach, and the journey towards becoming your own bank is not as challenging as you may think. With your $50,000 at hand, and a modest amount of knowledge, you can establish your business as its own bank and significantly transform your financial landscape.
Becoming Your Own Bank; A Definition:
Being your own bank involves challenging traditional thinking and taking control of your money, as well as the concepts associated with traditional bank funding. This can be achieved by leveraging the concepts associated with fractional banking, business credit based on your EIN number, and equity financing, which only require a bit of knowledge and direct application.
By adopting this approach, you can avoid the anxiety of going through the traditional financial approvals process and gain greater autonomy and flexibility in managing your finances.
It's all at your fingertips, and you didn't even know it!
The first step, lay the groundwork for your financial success:
Start by building a robust "Business Credit Profile and PADEX credit score". This will provide the basis for growing your financial empire. By establishing a strong business credit score, you can access funding based solely on your business's EIN number, without relying on your personal social security number. This way, you can steer clear of personal liability, high-interest rates, and fees that typically come with traditional bank financing.
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Next, consider opening a Business CD account:
By opening this type of account, you can earn interest on your deposited funds and also use the CD as collateral to secure new loans and lines of credit for your business.
Additionally, your timely payments on the loans will be reported to business credit agencies, thereby establishing a solid business credit report and providing a strong foundation for your future self-financing desires.
Finally, set up a cash reserve account utilizing a "Cash Value Whole Life Insurance Policy.":
A cash value whole life insurance policy can have several benefits for your business, especially if the focus of the policy is on the cash value's equity and your ability to take out loans and lines of credit.
Here are some key benefits:
Collateral for Loans: The cash value in a whole life insurance policy can be used as collateral for loans, providing your business with additional borrowing power. This can be particularly useful if your business needs to take out a loan but does not have enough collateral to secure it.
Access to Cash: You can also access the cash value in a whole life insurance policy by taking out a policy loan. This can be a useful source of funds for your business, as it can provide a quick and easy way to access cash without having to go through the traditional loan application process.
Tax Advantages: The cash value in a whole life insurance policy grows tax-deferred, meaning you do not have to pay taxes on the growth until you withdraw it. Additionally, you can take out loans against the cash value without incurring taxable income, as long as the policy stays in force.
Creditor Protection: Cash value in a whole life insurance policy is generally protected from creditors, making it a valuable asset to safeguard in case of bankruptcy or other legal proceedings.
Earn Interest on Full Amount of a Collateralized Loan: Should you take out a loan using your policy as collateral, the policy will continue to earn interest on the full amount of the cash value, not just the remaining amount after the loan. This can help offset the interest you are paying on the loan, and may ultimately allow you to keep more of your cash value intact over time.
Overall, a cash value whole life insurance policy can provide a valuable asset for your business, helping to provide financial stability and protection for years to come. It can offer a way to access cash and additional borrowing power while also providing tax advantages and creditor protection.
As you embark on this journey, arm yourself with the knowledge of building business credit for your company's EIN number and fractional banking. By understanding the basics of these concepts, you'll be able to leverage your deposits and maximize your earning potential.
Let’s look at a fictitious, yet doable scenario:
Let me tell you about Sarah, a fierce and tenacious woman who had a burning desire to make her entrepreneurial dreams a reality. She had always envisioned starting her own business, and after years of hard work and relentless determination, she had finally saved up $50,000 to invest in her vision.
But Sarah wasn't content with just investing her savings and hoping for the best. She was determined to leverage powerful financial concepts to turn her $50,000 into $150,000 or more.
And let me tell you, she did just that!
First, Sarah researched how to establish business credit associated with her EIN number. By doing so, Sarah was able to separate her personal finances from her business finances, build a strong credit profile for her company, and all of this in just three months!
While developing her business credit profile, Sarah opened a business bank account and a business CD account. These moves allowed her to keep her finances organized and separated, as well as earn a high interest rate as opposed to no interest for the business checking account.
And let me tell you, Sarah was one savvy businesswoman. She used her business CD as collateral to take out a business loan, paying back 80% of the loan immediately. By doing so, she established a positive track record with lenders and boosted her business credit.
But Sarah didn't stop there. She had a stroke of genius and opened a business cash value whole life insurance policy. She focused on building equity rather than solely relying on the death benefit.
And then, she had a brilliant idea. She borrowed against the cash value equity of the policy, accessing funds at a lower interest rate than a traditional loan. And the best part? She didn't have to go through any type of loan approval process.
But Sarah didn't just use the funds for her own business. No, she had a heart for helping other entrepreneurs grow their businesses too. So, she lent out portions of the loan to other small business owners, charging a higher interest rate than the policy loan rate. Sarah made a profit on her investment while also helping others succeed. What a brilliant move!
Through her unwavering dedication, boundless creativity, and strategic execution, Sarah turned her initial $50,000 investment into much more than $150,000. And she did it all within six months, without even selling a single product (at least not yet).
Sarah's story is a testament to the power of readily available information and a commitment to getting it done. She's a true inspiration, and her success is well-deserved.
The strategies we've discussed today, will enable you to reclaim your money and keep it within your own financial ecosystem, rather than relying on banks. This approach allows for true compound interest growth, as your money remains at work for you and your business.
Moreover, it's worth noting that you have full control over the entire process, and there's no need to qualify for anything.
You can establish a business credit profile and score, open a business bank account, set up a CD account, borrow against your CD account, open a Cash Value Whole Life Insurance policy, leverage the equity in the insurance account, and so on.
By following these steps, you can gain greater autonomy and flexibility in managing your finances, and take control of your financial future.
