by Ken Benjamin

The close of this article would be an excellent time to close your browser and begin to formally analyze your financial strength.

You must list all monetary obligations, including all short- and long-term liabilities, either on your books or anticipated, plus all assets you have.

Here again is where the age question comes into view. You may or may not have savings, or as I had when I started, not much money in the bank, but a heck of a lot of collectibles. By collectibles I mean such items as the second car, golf clubs, boat, cameras, antiques, bonds, stereo and just about any other saleable item that wasn’t nailed down and we could do without. These were quickly sold off for operating cash.

Don’t forget the life insurance policy that can be borrowed against or, as in my case, had cash surrender value — I cashed it in!

Likewise, it may be a bank equity loan against your real estate. It takes lots of money to run a start-up business without hope of income for some period of time — more character building going on here!

It may be family support you possess, or it may be the establishment of a different line of credit on other collateral.

After you’ve explored all possibilities in detail, now is the time to put it down on paper and begin to evaluate what the figures look like. The question of overestimating financial strength is the single greatest cause for not having he necessary staying powers to get through the trials and tribulations of the start-up period. Many people overestimate their financial strength either because of wishful thinking, laziness, or a classic case of monetary denial — don’t!

Next month’s column focuses on what you want to sell, where you want to sell it, and most of all whom you will represent.

This article is excerpted from Make Your Future Happen, Ken Benjamin’s definitive guide to starting an agency.