This is a tale of how help can come from unexpected places. The key is to take advice. You may well be very pleasantly surprised.
Mr. Max Profit, business owner, and his Finance Director, Arthur Sixpence, are having a meeting as to how they should fund the much-needed modifications to the production line of the business, “Profit and Moore Manufacturing Limited.” “Max, I don’t think the bank will help us with the £200,000 we need,” moaned Arthur. “And if they do they will probably want a charge over your house.” “Well they can’t have that. Mrs. Profit would never put up with it. It is where we brought up the little Profits and so she would never risk it. I don’t like the idea either. These are challenging times,” opined Max. “But we do need new machinery?” Arthur was seeking confirmation. “No doubt about that” affirmed Max. “We need to keep up with the competition.” Arthur scratched his chin in an effort to look as though he was thinking. In reality he just had an itch. “What about looking for a business angel to invest?” Max raised an eyebrow in a rather Roger Moore manner. “Really? Are you serious? Such an investor would want a chunk of ownership of the company for a paltry £200,000.” “It’s not paltry if you haven’t got it yourself,” proffered Arthur nervously. Max swung toward Arthur, eyes ablaze, and was about to lambast him when the door flew open! “It is I, The Funding Superhero!
You have known me as your independent financial adviser but I have Super Funding powers.” “David!? What on earth .?” stammered Arthur. The Funding Superhero pulled himself up to his full five foot seven and a half and announced “You think you do not have the wherewithal for the new machinery but you do! I have been advising you, Max, on your pension for the last few years and it can fund your needs.” Max and Arthur looked at each other in some disbelief. The Funding Superhero continued, “The pension fund can take a charge on the new machinery and lend the company the money to purchase it. The company will pay interest which is deductible against Corporation Tax but it goes into your pension fund tax free so you get the profit on lending money. The interest rate can be very competitive too and no need for a charge on your house.” Max grinned. “That’s brilliant! How much can I borrow?” “Up to 50% of your fund value as long as the pension fund can take some security.” “So, I could borrow more and get some new delivery trucks?” asked Max. “Yes, and any older pension plans could be consolidated and used for lending purposes,” said David, The Funding Superhero. “David, you are a genius and have given me and my business a new lease of life. But I must ask.” “Anything” said David, “I am here to help.” Max continued, “Do you really think that the Y Fronts worn over your blue pinstripe suit is a good look?”