Monetize Your Passion: 5 Steps to Start a Small Business

The best small business ideas begin with your own imagination. Identify what you’re passionate about and do something you’ve always wanted. If you’re no longer working for someone else or raising a family, you can work on your own terms. Launch a home-based business, make money from a hobby or even connect with friends who are also ready to start something new. See if there’s common ground to start a business endeavor together!

Great small business ideas can come from anywhere, but to truly monetize your passion, you’ll need a plan that covers doing what you want and knowing how much income you can potentially generate in a specific amount of time. A great place to start is the AARP Small Business Resource Center. It's filled with advice and education for those 50+ who aspire to build an entrepreneurial business. Visit smallbizrc.org to learn more. 

You may have enough savings to help you start the process of funding your idea, but a low-investment business concept is a good way to test the waters. Remember, you need to know all of your upfront costs, your budget and how much of a loan you can afford while maintaining your current lifestyle and without depleting your savings. Do your homework. Talk to others who have made a similar move and find out about all the costs involved. Also, socialize your vision with friends and family. There may be interest in a modest investment opportunity. Many businesses get off the ground that way.

Remember, if you consult a lending specialist, you’ll need a business plan — or at the very least, an outline. One that accounts for expenses, resources, staffing and projected revenues. There are statewide small business development centers that may be available to help with your preparation. They're dedicated to business plan creation assistance, training/mentorship programs and potential grant assistance, all key pieces to the entrepreneurial puzzle.

Put yourself out there. Hunt around online. Get an idea for what the demand and competition are for your new endeavor, but don’t be discouraged if you are not getting the answers you’d hoped for. It’s best to start small and build. This will help you establish demand for your product or service, which generates cash flow. Then you're growing the business more organically and avoiding the costs of traditional bank financing.

• Freelance your skills. The most successful business ideas usually start with what you’re already great at. Now, you need to decide if it’s more convenient to work within a well-established framework. Check out Fiverr, Upwork and Toptal — all great online freelance business marketplaces with the potential of big returns. These online platforms will connect you to great clients, and you can work when you want to. You’re still working for yourself without the hassle of finding clients or the day-to-day of running your own business. United Bank can help you easily set up a business checking and savings account — all built to help you succeed.
• Set up an online shop. A home-based business might be ideal. In no time, you can establish a marketplace to market your goods, and all the back-office support is built right in. Start selling on Amazon, eBay, Etsy or Shopify. Online shops offer great exposure for your goods, and you don’t have to worry about anything, except perhaps shipping, and getting paid. You might need to expand your output capabilities, and applying for a business credit card is a great way to increase your purchasing (and hopefully selling) power.
• Start your own business. You might decide that you want to start your own brick-and-mortar business, become a franchisee or establish a unique online brand. Would a business credit card or line of credit help? Should you get a small business loan or a personal loan? How should you invest your profits? A United Bank lending specialist can help walk you through all small business lending options and opportunities.

It’s best to know how your business will impact your taxes from the start, and how you structure your business will dictate your tax implications. Here are some things to consider:

• Social Security benefits. You may have to start claiming about 85% of your Social Security benefits as taxable income. Use the Notice 703 IRS form to calculate the exact percentage.
• Business expense deductions. You can reduce your tax burden by claiming business expenses that are necessary to the operation of your business on your tax returns — such as the business use of your home and business use of your car.
• Your new tax rate. Profits from your new business will increase your taxable income and thus your tax rate. Know that this may put you in a new tax bracket and can affect what percentage of your Social Security is taxable.
• Self-employment taxes. As a self-employed business owner, you're responsible for taxes such as income tax and Social Security withholdings. Talk to your CPA about how best to structure your business and how to maximize your deductions to lower your tax liability.
• Quarterly reporting. Business owners who expect to owe more than $1,000 in taxes for the current tax year must make quarterly self-employment payments to the IRS. If that sounds like you, talk to a United associate who can show you how to set up a timely payment plan to meet those expenses.

United Bank can provide the tools and expertise you'll need along your journey — from business inception to longer-term growth and expansion. Please consult your tax advisor for all tax implications.

Learning what worked for other women starting a business is invaluable on your way to success.

• Be organized. Are you a list maker? Great. Take notes on what you want to accomplish. The 24me app can help keep your hectic day organized, with features such as a to-do list, calendar, reminders for tasks and events, and note taking, making it easy to organize your thoughts and your day.
• Plan early. Establish the blueprint for the success of your new business with a solid financial plan. Your United Bank lending specialist can help walk you through the process.
• Have your eyes on the prize. Setting goals is important. Knowing where you want to go each quarter can keep you focused and propel growth.
• Know your worth. You are unique and so are your skills and goods. Confidently market and price your skills and goods as the leader in the field. Build your brand!
• Get the word out. Everyone is on their phone, so go where the eyes are. Build a website on Squarespace, use Constant Contact to easily build and send emails, and establish Facebook and Instagram accounts for your new business.