Securing funds to start, buy, or grow a business can be a struggle, but Guidant Financial is here to help. We’re the industry leader in 401(k) business financing, also known as Rollovers as Business Start-ups or ROBS. ROBS is an alternative financing method that allows you to use your eligible retirement funds to start or expand your business without tax penalties or assuming debt.
ROBS can even be used in conjunction with other funding methods – use ROBS as the down payment on an SBA loan and get to work with your money even faster.
Guidant Financial is dedicated to helping people succeed in small business. We work with new and existing business owners to provide financing education and customized funding solutions. With over 20,000 businesses funded, more than 15 years of experience, and billions of dollars secured for financing, Guidant is an industry leader in innovative business funding solutions.
How Rollovers as Business Start-ups Work
If you have at least $50,000 in a rollable retirement account, you can use ROBS to start or grow your business. ROBS allows a business owner to move money from their retirement account (such as an IRA or 401(k)) into a new 401(k) account, sponsored by the company being funded. The new 401(k) plan then purchases stock in the private corporation being funded.
Step 1 - Set Up a New C Corporation
Companies funded through the ROBS arrangement must be C corporations, so they will have stock for the new 401(k) plan to purchase.
Step 2 - A New 401(k) Plan is Established
A new 401(k) plan is established on behalf of the C corporation. The owner of the company becomes the trustee and plan administrator. This might sound intimidating, but Guidant offers 401(k) plan administration services to handle the hard part for you.
Step 3 - Existing Retirement Funds Are Rolled into the New 401(k) Plan
Funds are rolled from the existing retirement account into the new 401(k) account. This is the ‘rollover’ part of Rollovers for Business Start-ups.
Step 4 - The 401(k) Purchases Stock
The 401(k) plan purchases private stock in the C corporation.
Step 5 – Your Business is Cash Rich and Ready to Go!
Because of the stock purchase, the C corporation (your business!) is now cash-rich. These funds can be used for business operations including funding a new business, purchasing an existing business, or as a down payment on a SBA or business loan.
Guidant Financial – Money to Start or Buy a Business
Guidant Financial also offers SBA funding, unsecured funding, portfolio funding, and other alternative financing methods. We support small businesses through their life and beyond by also offering business valuation solutions, business services, 401(k) plan administration, and more.