Open a Small Business Through the BORSA Plan With Ease

Entrepreneurs looking for ways to finance their small business often times turn to alternative sources in lieu of traditional bank or SBA loans. A recent radio interview highlighted Phillip Crum, owner of a Sir Speedy printing franchise in Dallas, as described an innovative method to acquire money promptly and with little hassle through the BORSA (Business Owner’s Retirement Savings Account) plan. BORSA is a way for prospective business owners to fund the purchase of a franchise, business start-up, or business property using the holdings in a 401k.

Here is an excerpt from the interview with Philip Crum, which aired on The Business Owner’s Toolkit  talk show hosted by Rich Sloan and Troy Janisch.

“ TODAY WE ARE DISCUSSING SELF-DIRECTED 401K OPPORTUNITIES FOR ENTREPRENEURS AND BUSINESS OWNERS AS AN ALTERNATIVE FUNDING SOURCE. OUR NEXT GUEST IS PHILLIP CRUM, ONE OF THOSE HEROES WHO ACTUALLY TOOK HIS 401K SAVINGS EARLY THIS YEAR AND INVESTED IT INTO HIS OWN BUSINESS. PLEASE TELL US HOW YOU LEARNED ABOUT THE BORSA PLAN AND HOW PEOPLE CAN TRULY PUT THIS TO WORK.

HELLO RICK, WELL I’VE BEEN IN THE PRINTING BUSINESS FOR OVER 15 YEARS AT ANOTHER FACILITY AS SOMEONE ELSE’S EMPLOYEE AND HELPED THEM BUILD A RATHER LARGE BUSINESS. I GOT A PHONE CALL BACK IN DECEMBER OF LAST YEAR FROM AN OWNER THAT WANTED TO SELL HIS PRINTING FRANCHISE, WHICH HONESTLY WAS ABOUT THREE YEARS AHEAD OF MY PROJECTED PLANS TO PURCHASE MY OWN FACILITY. FINDING THE MONEY TO BUY IT ON SUCH SHORT NOTICE WAS A BIT STRESSFUL UNTIL I REMEMBERED A CONVERSATION I HAD ABOUT EIGHT MONTHS PRIOR.

AT THAT TIME I HAD BEEN RESEARCHING POSSIBLE AVENUES FOR GETTING START-UP CAPITAL FOR THE EVENTUAL PURCHASE OF A FRANCHISE. ONE DAY I WENT TO TALK TO A LOCAL BANKER AND AFTER SEEING THAT THE OPTIONS WERE FEW AND NOT VIABLE AT THE MOMENT I GOT UP TO LEAVE. AS I WAS ON MY WAY OUT THE DOOR SHE ASKED ME IF I HAD EVER HEARD OF A BORSA PLAN. AFTER I SAID NO SHE WENT ON TO SAY THAT IT WAS A PROGRAM THAT SOME CPAs IN SOUTH TEXAS HAD PUT TOGETHER, THAT IS BASED ON AN IRS TAX CODE CALLED ERISA (EMPLOYEE RETIREMENT INCOME SECURITY ACT).

NATURALLY I EXPRESSED AN INTEREST AND WE WENT AHEAD AND MADE A PHONE CALL RIGHT THEN AND THERE TO DOUG DICKEY, OWNER OF THE DRDA/CPAs IN HOUSTON. WE HAD A BRIEF DISCUSSION ABOUT THE PROGRAM AND HOW IT WORKS WHICH I KEPT IN THE BACK OF MY MIND FOR LATER USE. EIGHT MONTHS LATER IN DECEMBER I FOUND I HAD A USE FOR IT. I HAD JUST WHAT I NEEDED IN MY 401K TO COVER ALL THE START-UP EXPENSES AND ENOUGH CAPITAL TO GET THROUGH THE FIRST SIX MONTHS OF BUSINESS. THE BORSA PLAN REALLY HELPED ME REALIZE MY DREAM WITHOUT COMPLICATION.

PLUS, THERE WEREN’T ANY REAL CONCERNS ABOUT TAKING THE MONEY OUT OF MY 401K BECAUSE UNLIKE THE STOCK MARKET, THERE IS MUCH MORE CONTROL OVER A SMALL BUSINESS. I HATE THE IDEA THAT WHEN I AM DOING THINGS IN THE STOCK MARKET THAT WHAT ENDS UP MAKING THE DECISION OF WHETHER THE VALUE GROWS OR DROPS IS FAR BEYOND MY CONTROL.”

For more information about the BORSA plan and how you can easily open a small business without incurring early withdrawal penalties contact the DRDA/CPAs today at 281-954-6040!