For plenty of people living in Colorado, starting a business is a dream come true. After all, the autonomy and freedom that come with being self-employed are enviable, not to mention the ability to shape the world as one sees fit whether it’s by selling scrumptious desserts or offering phenomenal customer care in the IT field.
Regardless of the nature of the business itself, entrepreneurs have to dole out cash to get things started, and some of these costs may take them by surprise. For starters, entrepreneurs have to pay for business insurance in order to protect themselves against possible future liabilities. One insurance company asserts that small businesses pay, on average, $741 just to protect themselves against general liability. Another cost that should be taken into account is self-employment taxes, which tend to be higher than taxes for employed individuals. This discrepancy is due to the fact that self-employment taxes pay for both Social Security and Medicare. In addition to increased taxes, entrepreneurs have to contend with the costs of licenses and permits, forcing them to keep reserves for a rainy day.
Aside from the expenses involved in starting a business, it also costs plenty to run one. For one thing, hiring a professional or outsourcing a little work can force an entrepreneur to dig a little into his or her own pockets. Furthermore, given the amount of spending that comes with running a business, startup owners can suffer if they have bad credit. After all, a bad credit score means someone has to borrow more money, which can impact the bottom line.
Speaking of outsourcing, entrepreneurs will tend to find themselves in the position where they need professional legal assistance with setting up the business or settling a legal dispute. In any case, it is advisable that an entrepreneur takes his or her time to shop around for the most experienced legal representation to suit his or her needs.
