Other Businesses?

[bluedrop]

Hi All,
I've been seriously wondering what most of you do with the 'Warchest"? I am curious - Do you have any other businesses apart from your mainstream contacts? There are many seasoned contractors here - do you invest your war chest or let it sit in the business bank account?

I am quite keen on starting something - and I have done some ground work on a few ideas.

Keen to hear views on this topic.

-Bluedrop

[northernladuk]

Your warchest is not for spending on other businesses. It is there to sit there for immediate access should the worst happen and you can't work or can't find a contract once your current one has ended.

The spare money on top of that can be used as you see fit.

HTH.

[bluedrop]

Sorry, what I meant was the spare money after you set aside enough to keep you going for a year.

[TestMangler]

Your warchest is not for spending on other businesses. It is there to sit there for immediate access should the worst happen and you can't work or can't find a contract once your current one has ended.

The spare money on top of that can be used as you see fit.

HTH.

Says who NLUK ??

There is no hard and fast rule about what a warchest is for (or not for).

I regularly dip mine for investment in other things.

[TestMangler]

Sorry, what I meant was the spare money after you set aside enough to keep you going for a year.

Yes. Some are involved in other businesses or start other businesses.

Usually referred to as 'Plan B'

[SneakySimon]

Plan B

I tend to invest mine into the Plan B which is a company my Mrs Sneaky is running and then building up some more cash to either splurge on Plan C (since Plan B makes money but not loads).

Its pretty easy to do - my accountant advised me, after corp tax paid on money, can do with the cash as see fit. To keep things simple, I created a new company for Plan B - I think some people on here use the contractor company / bank account which I am personally not keen on.

[ChimpMaster]

Your warchest is not for spending on other businesses. It is there to sit there for immediate access should the worst happen and you can't work or can't find a contract once your current one has ended.

The spare money on top of that can be used as you see fit.

HTH.

It depends on the size of your warchest. If you only have £10,000 then of course I wouldn't advise risking it on another business. If you have £100,000 then it's another matter altogether. There are of course many more variables, such as your living costs etc.

Personally the money isn't a problem - I just don't have any good ideas!

[ChimpMaster]

I tend to invest mine into the Plan B which is a company my Mrs Sneaky is running and then building up some more cash to either splurge on Plan C (since Plan B makes money but not loads).

Its pretty easy to do - my accountant advised me, after corp tax paid on money, can do with the cash as see fit. To keep things simple, I created a new company for Plan B - I think some people on here use the contractor company / bank account which I am personally not keen on.

The problem with multiple companies is the 'associated companies' rule which means that your small company taxation threshold will be breached more easily. This was the main reasons I didn't set up a new Ltd for property investment (we just run it through personal taxation instead).

[northernladuk]

Says who NLUK ??

There is no hard and fast rule about what a warchest is for (or not for).

I regularly dip mine for investment in other things.

That is very true but you have been around long enough to understand the need for a warchest and the ways of contracting. Our esteemed friend Bluedrop is not, so was making a point clearly as it was obvious that level of understanding was not there.

[MarillionFan]

That is very true but you have been around long enough to understand the need for a warchest and the ways of contracting. Our esteemed friend Bluedrop is not, so was making a point clearly as it was obvious that level of understanding was not there.

Risk adverse poppycock.

I don't take much notice of the whole warchest debate on the basis that my Ltd is just one form of many incomes. No point having a warchest if it's better to take it out, pay some tax and invest it elsewhere. Stop thinking that your Ltd is the be all and end all. It isn't.

I've in the past used funds from my Ltd to open a chain of shops, import containers from abroad, set up websites, fund the development of an internet kiosk, purchase stock for an 'IT bookshop', used it to fund development of software and have done so by direct funds, directors loans, loans from one business to another, used the same LTD for different income streams(get's messy that) and also by registering as Self Employed and using the losses of personal income on one(by paying out wages family/partner + other costs) to offset the taxable income on another.

It all depends on your level of risk and your entrepreneurial spirit. Doesn't sound like NL is cut out for business best so stick as a contractor. ;-)