An Overlooked Option for Starting a Business Debt-Free

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This is a sponsored post written by me on behalf of Guidant Financial. All opinions are 100% mine.

Start your own business with Guidant Financial.

There is no more liberating feeling than being your own boss.

It’s a feeling that many of you may never experience. But it is a feeling you could experience if you were to join the other 28 million small business owners in the United States doing something special…owning your own business.

You see, that’s actually a lot of people. Nearly 10% of the entire US population to be precise. So while you may think that owning a business is something only an Ivy League educated individual can do, you’d be wrong.

Starting a business was an idea that Jeff and I toyed around with in college but never really got serious about. Neither of us went and got our degree in finance. Neither one of us had a clue about how to run a business. We just had an itch to do something on our own but never had the courage to actually do something about it.

Two years ago (and 5 years removed from college) that all changed. And what an amazing experience it’s been. Our only wish was that we had done it sooner.


I could go on and on about how incredible it’s been to get to do something you truly enjoy day in and day out. Even on days where we work from sun up until sun down (welcome to being a small business owner sometimes), we can’t get enough of it.

And so, in an era where government incentivizes job growth and business innovation to help stimulate the economy, there is a unique, but not necessarily widely known, opportunity to fund a new business idea without having to go into debt and/or take out massive loans just to finance the operation.

Funding a New Business Is Easier Than You Think

Rollovers for Business Startups, or ROBS for short, are one of the easiest ways prospective business owners can get the capital they need to start their own business.

No having to pitch ideas to investors. No getting approved for loans by a bank. No lines of credit with thousands of dollars in debt and crushing interest payments.

Finally, that lifelong dream of opening your own restaurant, or building that surf shop off the coast of Maui, can become a reality simply by using a portion of your retirement funds to start your new business.

This is what 401(k) Business Financing does. And why it's amazing. Simply put, it's a tax penalty-free way to roll money out of an existing 401(k) (or really just about any tax-deferred retirement vehicle for that matter) to start your new project.

If you have at least $50,000 in one of the retirement accounts types listed below, there’s a good chance you’ll be eligible for ROBS funding.


For the sake of transparency, Jeff and I did not need to utilize the ROBS funding method to establish our small business. We weren’t building a storefront, purchasing merchandise or establishing a franchise. We incurred very little startup costs and as a result did not need quite the same resources one would need to accomplish any of the above. And that’s okay.

Each and every business is different.

Many of your ideas will require a physical selling location, require front-loaded startup costs and necessitate licensing deals…just to get started.

And so if you think your project will cost need in excess of $50,000 to get off the ground (as most business/franchises will) but you’re not interested in risking your home as collateral and/or taking out a massive loan, then the ROBS funding method may be perfect for you.

If you think that this is something that you may be interested in, then there are a few general things to be aware of:

  • As previously mentioned, ROBS are best suited for individuals (or small groups of people) who plan on incurring at least $50,000 startup costs.  Otherwise, taking a distribution from your retirement account would probably make more financial sense.
  • While most people who utilize this small business financing method are starting their own business, individuals also have the option to buy an existing businesses/franchise if that is something you would be interested in.
  • You must be a salaried employee of the corporation you plan on establishing (meaning you can’t just withdraw funds from a retirement account to invest passively in a business; you actually need to work for that corporation).
  • You will be required to operate as a C corp to meet IRS business transaction requirements that make using your retirement funds possible.

Getting Started

If Jeff and I regret one thing about the way we started our small business it is that we didn’t get someone who actually knew what they were doing involved in the process sooner. We were operating on a whim from the get-go and that’s not how you want to go about starting your company.

If you think that ROBS funding may be the right fit for you, we would recommend getting help from experts on the subject. Our friends over at Guidant Financial are just those experts (really…they’ve helped finance more entrepreneurs than any ROBS provider in America).

While Jeff and I can tackle just about any personal finance-related issue, business funding is a whole other ball game. The reason we tell people about ROBS is because it is one of the only ways to start a business with debt free financing and Guidant is the very best when it comes to helping you do just that.

Having experience in starting a business is invaluable. If you don’t have that experience yourself, then having a relationship with someone who does is worth every penny and that’s a lesson Jeff and I learned the hard way. In hindsight we were much better off paying someone to help us to do things correctly the first time around rather than pay someone to fix our mistakes and then help us do things the right way.

To see what sort of business you can start with a Guidant Financial ROBS arrangement, check out the video below.

If you want to be one of those 28 million Americans like Jeff and I who own their own business, take that first step and get more information about the financing you need to get started. To learn more or see if you qualify, check out Guidant’s 401(k) Business Financing page here.


Learn More

401(k) Business Financing and Small Business Loans

Ben Huber
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Ben Huber

Co-Founder at VTX Capital, LLC.
Ben is an avid market enthusiast who serves VTX Capital, LLC. in an advisory and support role. He works behind the scenes managing the technical components that allow us to bring you the latest in digital personal finance via an online platform.

His areas of expertise include CMS Support, Social Media Branding, Content Marketing and Advertising.

He currently holds a BS from Virginia Tech and a BSN from Western Governor's University.
Ben Huber
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