February 1, 2023

Unitranche

Supportive Business Potential

Dave Ramsey Says to Take 6 Steps Before Starting a Business. Is He Right?

A man sitting on a couch in his living room and writing in a notebook while on the phone, with a laptop and calculator on the coffee table in front of him.

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Could these six steps help you on the path to becoming a successful entrepreneur?


Key points

  • Opening a business is a dream many people have, but there are steps you need to take to do it right.
  • Dave Ramsey recommends six key steps for prospective entrepreneurs, including making a business plan and planning for taxes.

If you’re thinking about opening your own small business, you may be surprised to find the process isn’t as easy as hanging a shingle and starting to sell your goods and services.

In fact, finance expert Dave Ramsey recommends six key steps that you should do before your doors even open and you start serving customers. Here’s what they are — along with some advice on whether you should follow his suggestions.

Follow these six steps before starting a company

Before you start a business of your own, Ramsey recommends doing the following six things:

  1. Determining your why: Ramsey urges you to think about the motivation behind why you want to start a business, as this can guide you through inevitable tough times and help ensure your company is actually a success
  2. Making a business plan: According to Ramsey, your plan should include details about the product or services you’ll offer; the schedule you’ll work; what you will charge for your products and services; your company budget; and the policies your business will operate under.
  3. Officially launching your business: This doesn’t mean opening the doors yet — it means taking care of the technical stuff involved in opening up. Ramsey said this could include getting a license to operate your company; deciding how to structure your business; securing financing if needed; and opening up a checking account for the business so you can keep company money separate from your own.
  4. Planning for tax issues: Ramsey warned that business owners have to pay self-employment tax and pay into the IRS throughout the year. Many people who have only had employers haven’t had to take care of these issues before, so Ramsey suggests planning even before opening your doors so you don’t get hit with penalties or surprise costs.
  5. Creating a marketing plan and brand identity: According to Ramsey, these steps include developing a personality for your company and making a plan for how to get the word out using techniques such as social media marketing and more.
  6. Setting realistic expectations: Finally, Ramsey warned you need to be patient and realize that you will take time to get up and running and that you should make sure you have the right support in place in order to see you through the process.

Should you follow Ramsey’s advice?

Ramsey is absolutely right that all of these steps are really important before you jump into starting a company of your own. In fact, his advice is invaluable to would-be entrepreneurs.

Often, it’s all too easy to get caught up in the fact that you have a good idea or that you want to work for yourself and you may not think about the realities of all the hard work that goes into running a successful company.

If you take the steps Ramsey recommends, you can set yourself up to be more successful, as you’ll be going in with a solid plan and with the right financing and tools in place. While this requires time and effort, it’s well worth it to get your business off on the right foot.

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