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rated:
Hi everyone,

I am in a pickle.

After helping several brands achieve success, I would like to try to start my own consumer goods company while continuing to work my current job.

But my question is: should I go ahead and buy a condo first? I feel like I am throwing money down the drain on rent.

Currently I have about $10K in savings. This would be enough to get my wife and myself into a 200K 2br condo with mortgage similar to the current rent.

On the other hand, I believe getting my own business going will cost between $50K–60K. A large quantity can be saved by not needing an agency. It seems 10K could get me started this year working farmers markets, building my brand, and setting myself up for what lays ahead.

But in this case I will be throwing money down the drain at rent until this (or another) business succeeds. And there's always the chance that nothing will succeed.

Is there a clear choice here for any of you?

Thank you!

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rated:
Renting doesn't mean throwing money down the drain. 

rated:
xxxkxxx said:    I would like to try to start my own consumer goods company 
  To compete with 
1 Nestlé SA $103,734 2.69%
2 The Procter & Gamble Company $84,167 0.58%
3 Unilever PLC $68,550 1.07%
4 PepsiCo, Inc. $66,415 1.41%
5 The Coca-Cola Company $46,854 (2.42%)?


rated:
Neither. Wait and build up more funds before pulling the trigger on the condo or business.

What happens, after you buy the condo or start a business - using all 10K, you need 1K (or more) for an emergency.

rated:
Don't buy a condo.

Option 1:
Your business is very successful and you want to relocate or you are acquired by a bigger brand. You won't want to own in that case.

Option 2:
Your business fails. You won't want to own in this case.

rated:
You could try you hand with the business but definitely do not try to buy right now. You simply don't have enough funds to purchase at this time. Lets assume you did buy a 200k condo right now using ALL of your savings. What now, what happens when your first big expense maybe hits you right off the bat? Nobody knows the future and you would be putting yourself in a position to have to resort to credit card dept (or other dept) to make ends meet.

If the business will take all 10k to start as well, while you can as I mentioned, try the business, I would still suggest saving until you have at least some additional cushion to fall back on when the unexpected happens.

rated:
Right... several brand to success and you have $10k in saving?! What's this, Troll Thursday?

rated:
I can believe the "helping several brands to success" backstory. My town seems to have a lot of consumer goods (and other) startups. These are like specialty food & drinks distributed via groceries, clothing & outdoor gear. "Success" doesn't mean the're just barely off of ruffle's list, it can mean they've got actual sales and are able to pay their monthly bills. Many never make it that far. And "helping" doesn't mean a founder with an equity stake, it can very much mean someone working in the marketing or sales. These are often not even full-time positions as the companies try to bootstrap.

But I also think OP should take it very slow. That's very little capital to start and your repeated claim that rent is 'throwing money down the drain' shows a huge lack of expertise that would be plenty to sink a business even if it's based on a great idea.

rated:
When I've rented I feel like I'm living pretty frugally-fixed costs with no repairs. Every house I've bought has felt more like throwing money down the drain- repairs, taxes, buying costs, selling costs.

rated:
There's a lot more factors that come into play. Like how long do you plan on staying in the area, how much rent are you paying now? With just 10k, that sounds like a 5% down payment or in reality, more like 3.5% on an FHA as you still need money for closing costs, attorney/title company, home inspector, moving costs, etc. With such a low down payment, don't forget the deduction on the interest you'd get.

rated:
I would save $20k more before you consider doing either.

Edit: I'm back to give a non-cynical answer. If you think you could be successful in your business, don't go into debt to do it. Keep your day job and slowly work on your own business without taking out loans or compromising your financial picture.

rated:
henry33 said:   There's a lot more factors that come into play. Like how long do you plan on staying in the area, how much rent are you paying now? With just 10k, that sounds like a 5% down payment or in reality, more like 3.5% on an FHA as you still need money for closing costs, attorney/title company, home inspector, moving costs, etc. With such a low down payment, don't forget the deduction on the interest you'd get.
  Going to have to pay PMI with that amount of a DP.

rated:
wp746911 said:   When I've rented I feel like I'm living pretty frugally-fixed costs with no repairs. Every house I've bought has felt more like throwing money down the drain- repairs, taxes, buying costs, selling costs.
  haha! i need more tenants like you!

rated:
xxxkxxx said:   Hi everyone,

I am in a pickle.

After helping several brands achieve success, I would like to try to start my own consumer goods company business

 Why would you possibly want to do this? Start a business helping other brands, and let them bear all the risk of failing.

rated:
rufflesinc said:   
wp746911 said:   When I've rented I feel like I'm living pretty frugally-fixed costs with no repairs. Every house I've bought has felt more like throwing money down the drain- repairs, taxes, buying costs, selling costs.
  haha! i need more tenants like you!

for those unfamiliar - this is rufflesinc being snarky. he strongly believes that renters are suckers and owning/landlording is absolutely superior in all cases....he's wrong, but we have all agreed not to tell him. I find that repeatedly digging holes and filling them in is more productive.

rated:
ach1199 said:   Renting doesn't mean throwing money down the drain. 
  +1
OP: Have you done a rent vs buy calculation. Here is one such calculator: http://www.nytimes.com/interactive/2014/upshot/buy-rent-calculat...

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