One of the biggest challenges for a personal trainer who wants to have his/her own gym is to gather the finances for it. Starting a fitness startup is no easy task and requires months, if not years, of planning. It’s not like other startups where you can just hire a few staff and start from home. You actually need a large space and you need to furnish it with expensive equipment before you can start making some cash. Even if you want to start with a small fitness center with limited equipment and a few members, it’s still going to be costly, so the only option is to take a loan.
What is SMSF?
To initiate a new startup, the biggest mistake people make is taking a large loan. Although the low interest may seem lucrative now, if the interest rate doubles later, will you be able to afford it? Most businesses go bankrupt this way, so don’t make this mistake. Here is where a SMSF comes along! A self managed super fund or SMSF is essentially a trust fund and has either individual or corporate trustees. If you want to make money off of your retirement fund and want total control of your wealth then SMSF is the right choice for you.
You will not only gain interest from your retirement fund but also invest your superannuation however you please. Generally a corporate trust find is more costly to sign up for, however, it’s the best choice for investment into a start-up due to its benefits. This is because you and a few other individual members alone cannot make the fund profitable, which requires a minimum of $200,000 to be cost effective. You can find out more here http://www.dixon.com.au/smsf/setup/is-an-smsf-right-for-you
Despite the definite setbacks, a SMSF is definitely a golden opportunity for entrepreneurs. It allows you to pool your partner’s as well as your assets together to apply on your investment. Moreover, they give free reign to choose from a wide variety of investment options. It can be anything from industry super funds to traditional retail. Oh, but wait, there is more! If you are a SMSF trustee, corporate or individual, you can even invest on direct shares, corporate debt, purchase property, and much more. Furthermore, you can easily reduce your tax burden as you incorporate SMSF into your financial plan in the future.
So how are they different from other corporate funds? Well, from the year 2010 to 2014, SMSFs achieved a whopping 12.5% in return compared to just 9.65% from industry funds! SMSFs cost less but give more benefits! Lastly, don’t forget to build a client following even before you start thinking about starting a business. Target those that are just about to renew their membership because you can catch them right before they get locked in a contract. There is no point of spending so much money if you can’t even get clients. Best of luck!