Investing for the Small Business Owner

You’ve invested time and effort into your business and reaped the financial rewards. Now it’s time to consider the bigger people and investing in more. “I’m a better investor because I’m a businessman, and I’m a better businessman because I’m an investor,” quoted multi-billionaire Warren Buffett. Chances are, if you have the head for running a small business you have the head for investing too. Here are some options to consider. 

Should I reinvest in the business? 
Your business is your baby and you are extremely loyal to it. This is why many small business owners feel they have to invest back into the business. While this loyalty is admirable, it could be stopping your business from growing. In actual fact, business owners that consider a very wide array of investment options, tend to have the best growth.

Precious metals
A common option for beginner investors is to put at least part of their investment portfolio into precious metals. This is especially popular during times of economic uncertainty as precious metals are low productivity but also low risk assets. Gold investment, such as the popular Australian gold nugget, are determined almost solely by the market whereas investments in silver, such as Canadian silver coins, swings between its perceived role as a store of value and it’s tangible role as an industrial metal. Precious metals offer intrinsic value and can be a great way of diversifying a portfolio but, for beginner investors, it’s probably best not to fall into the trap of over investing. 

Stocks
For a beginner, the stock market can be very overwhelming. As with an individual, it might be best for a small business to hire a professional to manage your investing, at least to begin with. Usually a diversified investment portfolio is the key to getting on the right track. It’s also important to take a deep breath and admit that the market fluctuates. Unless you plan on retiring in the near future, even if something goes south you have time for it to climb again.

If you are at the point where your business has spare cash to invest, the first thing to do should be to congratulate yourself. In most cases though, while sitting on your laurels is safe and comfortable, it doesn’t exactly endanger the growth needed for your business to achieve its potential. Investing wisely can be a great next step. Have some confidence – if you’ve steered the ship this far you probably have it in you to ride out the next leg of the journey!

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