You’ve Sold Your First Business: What Should You Do With the Money?
You’ll have put a lot of blood, sweat, and tears into building your business. But now that you’ve sold it, it’s time to start thinking about what you’ll do in your post-sale life. This might be the first time that you’ve ever had such a substantial amount of money just sitting in your bank account, and it won’t be surprising if you’re a little bit apprehensive about the best course of action to take. Below, we run through some of the ideas that’ll hopefully keep you on the right track.
Figure out the Taxes
Before you get too comfortable with your bank balance, it’s important to check that all of that money is actually yours. You’ll need to know how much of the sale is owed in taxes, and any other expenses that you need pay. As such, you’ll be well-served by hiring a professional that can run you through everything you need to do. As the adage goes, don’t count your chickens before they hatch; the only money that’s actually yours is the figure that’s left behind once all the bills have been settled.
Look at Another Business
You’ve already had success with one business, why not start another? While you’ll want some time to relax and enjoy your success, it’s unlikely that you’ll want to leave the workforce for good. You might have a sizable pot of money, which is likely much greater in value than whatever money you started your last business with. You’ve got the ideas, you’ve got the experience, and you’ve got the means to make it a reality. Go for it!
Keep Things Ticking Over
Of course, whether you decide to start your own business or not, it’s important that you don’t put all of your eggs in one basket. If you do, you might find that you’re in a worse financial position than before the sale. As such, it’s a good to invest some of your money. If you’ve never invested before, then read up on the basics, and consider using a robo-advisor; check out Betterment vs Vanguard to see which option is right for you. By investing some of your cash, you’ll be able to ensure that your profits aren’t all tied up in one venture or, worse, just sitting idle in your bank account.
Figure Out Financial Approach
If this is new-found wealth, then you’ll need to ensure that you – and your partner, if you have one – figure out a new financial approach. Essentially, this means setting out a budget and sticking to, figuring out what you’ll do with friends and family who want to borrow money, and so on. By having a clearly outlined strategy, you’ll be able to avoid the adhoc spending that can cause issues.
Finally, remember to be careful. With great money comes great responsibility, after all. It’s important not to rush into anything. Take your time, figure out how you’ll be spending your post-business life, and apply the same wisdom that made your business a success in the first place.