With all the talk about the different types of funding that are available to business owners there is often one option that is overlooked that I think is important for me to bring to your attention.
There is a form of business funding where the interest you pay on the finance provided is paid back to you.
As a business owner, not only can you grow your business with the funding it requires, but you can potentially increase your net worth at the same time.
Unlike many of the newer forms of alternative funding out there, this has been available since the 1970s. It has been well tried and tested but not that well known to many business owners.
Pension-led funding (PLF) allows you to invest a portion of your accrued pension assets into the business – without the requirement for personal guarantees or charges over your domestic assets.
The interest on this finance is paid back into the pension, tax relievable from the business standpoint and with all the tax benefits of growing in a pension scheme.
For business owners this is an option that you should consider alongside other funding options if you have money held in pensions. It might not be for you, but you should look at how you might use PLF to help achieve two of your most important goals…
- Growing your own business
- Building your net worth
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