The historic $1.9-trillion American Rescue Plan of 2021 was signed into law by President Biden a few days before the federal unemployment benefits were set to expire on March 14. This bill provides thousands of dollars of relief for countless families and small businesses in the United States.
The Internal Revenue Service on Friday began processing payouts and many people are starting to receive their $1,400 stimulus check. The American Rescue Plan includes full $1,400 payments for individuals with adjusted gross incomes of up to $75,000, heads of households that make up to $12,500 and married couples filing jointly with annual income up to $150,000.
How do you plan to spend your stimulus money? For many, this relief provides an opportunity to invest in education, pay off debt, put money away in a 401K account or book a long-awaited trip. For some, starting a small business is on the agenda.
Starting a business now might be a good idea as enthusiasm about the vaccine is remaining steady, affecting market conditions for a positive economic return in Arizona. According to a recent report supported by the Arizona Small Business Association, “Small business employees and self-employed individuals make up 52.9% of Arizona’s workforce — approximately 1.6 million jobs.”
With the anticipated return of a new normal expected around the fourth of July, there are several steps you can take to start your business with less than $1,400. This amount may not seem like a lot of money, but it is enough to get some easy fundamental steps out of the way so you can move on to the fun part. Before you get started, make sure you spend time exploring online resources about business plans, legal filings and more. You can find many resources for free with a simple Google search or by visiting your local economic development office.
Here are five steps you can take to invest your stimulus check to start your business.
- Register your Limited Liability Company (LLC) Cost: Between $50 – $500. Registering your small business with the Arizona Commission Corporation is as easy as starting a Facebook page. The minimum cost is $50 and can take several weeks to get your approval. We will pretend you spent money on expediting your filing and you now spent $275. Your next step is to get a tax ID number.
- Obtain your tax ID number or Employer Identification Number (EIN) Cost: $0. Your Employer Identification Number can be obtained at no cost through the Internal Revenue Service website (irs.gov/ein). Again, it is as easy as registering a social media account and will require you to enter your personal financial information. The web portal walks you through each step. Make sure you save a copy of your new EIN letter; you will need this to open your business bank account. Keep an eye out for free business checking accounts; they may require a deposit as low as $50 to open.
- Hire a graphic designer on Fiverr to create your logo. Cost: As low as $100. Have you heard of Fiverr (fiverr.com)? It is a freelance designer’s wonderland of services for very affordable rates. You can find excellent designers to help you craft a professional logo so you can put your best foot forward. A word of caution: Make sure to fully read through reviews, check out their past work, and chat with them to see if you are good fit working together. With time, you will find yourself outsourcing a lot of things on Fiverr and it will help free up your time to focus on other important business matters.
- Design your own business cards on Canva. Cost: As low as $25. Canva (canva.com) has become the entrepreneur’s secret weapon to quick and sharp designs. You can create just about any type of marketing material to help boost your business. What makes the platform great is that you can order prints of your designs, and a business card will never go out of style. You can start by ordering your first 100 business cards for less than $25.
- Create your new business website on Shopify with an annual subscription. Cost: $948 a year. Your website is your online store. This is where you can list your services and sell your products. If you sell a service, you can quickly build links for customers to book appointments with you. Your Shopify account (shopify.com) can handle most of the business responsibilities like collecting payments and generating accounting reports. They also come with handy templates you can put your new logo over and promote on social media. If you are selling a product, you will need to consider additional costs of inventory and more. For now, you are as ready to start a business as any other big company!
How much have we spent so far? Let us check the math.
- LLC: $275
- EIN: $0
- New Business Account Deposit: $50
- Logo: $100
- Business Cards: $25
- Website: $948
- Total $1,398
Of course, stretching $1,400 to start a business may not work in all industries. However, for many who want to start by taking baby steps, this is a great way to make an investment in your dream business. Always seek help from professionals who can help you stay on track to accomplish your goals.
EDGAR RAFAEL OLIVO is a bilingual business educator, economic advisor and contributor for several media outlets. He’s a nonprofit executive who is passionate about education. He is certified in finance and data analytics and holds a business degree from Arizona State University.
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