| By :
Molly Wider
Believe it or not, a recession is the best time to start up a new small business, according to the USA Today. The banks have decided not to invest in small business start ups the entrepreneurs are investing in themselves by utilizing a Retirement to Franchise Transfer plan. You would be able to invest into a fra. That allows them to use the funds for operating capital covering the cost of doing business. The stock is being purchased in another company by the individual, or invested and therefore they will not suffer any withdrawal penalties. A company called Honest-1 Auto Care, has seen a dramatic explosion in the number of new franchise owners who have turned to this method of financing rather than the difficult to get small business loans. Honest-1 Auto Care has experienced that 20% of their new franchisees have used their 401k,IRA, or other retirement accounts for their funding. As this number will likely grow because Honest-1 Auto Care has plans to double the number of new locations in the coming year. So that begs the question, is your retirement account, whatever type you may have, be the best source of funding for your new small business? First you must determine how much you are prepared to lose, and the amount you have saved up. You certainly don't want to jeopardize your financial security in your golden years. So if you are young enough and would have enough time to recoup the possible loses by investing in your small business start up, then a Retirement to Franchise plan may be viable option for you. Never prematurely start cashing out a 401k or an IRA account without sitting down with your finacial planner to make this extremely important decision. This is why individuals who are creative enough to be successful in a small business can figure it out!
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