For Subscribers

5 Proven Ways to Make Money Starting With Just a Small Loan

Far from a danger or sign of trouble, a strategically timed loan can be a boon to your profit margin.

learn more about Asim Mughal

By Asim Mughal

Opinions expressed by Entrepreneur contributors are their own.

More often than not, loans are perceived negatively. The mention of debt is often accompanied by horror stories of bankruptcy and other theaters of financial distress. It's no wonder, then, that people tend to consider loans as last-ditch efforts at paying for emergency expenses. But is this bad rep justified? After all, if a loan can save a dying business, and in turn, help secure a profit, it's a savvy and often indispensable move. Of course, there are also instances in which borrowers are faced with not being able to pay off a loan, but as long as liabilities and forecasts are carefully planned, good debt can be a lifeline, and can be used additionally for investment organizing.

When you "leverage" debt to maximize a return on an investment, you are, put succinctly, using borrowings at a lower rate to fuel a return at a higher rate. Though there is a risk of losing capital, using debt to gain profit is an often underrated means of making money. Once you review your risk appetite and perhaps change preconceived notions regarding loans, it's possible to turn debt into profit-making investment instruments.
Five relatively safe ideas to get you started:

Continue reading this article — and all of our other premium content with Entrepreneur+

For just $5, you can get unlimited access to all Entrepreneur’s premium content. You’ll find:

  • Digestible insight on how to be a better entrepreneur and leader
  • Lessons for starting and growing a business from our expert network of CEOs and founders
  • Meaningful content to help you make sharper decisions
  • Business and life hacks to help you stay ahead of the curve

Related Topics

Editor's Pick

The Dark Side of Pay Transparency — And What to Do If You Find Out You're Being Underpaid
Thinking of a Career Change? Here Are 4 Steps You Can Take to Get There.
A Founder Who Bootstrapped Her Jewelry Business With Just $1,000 Now Sees 7-Figure Revenue Because She Knew Something About Her Customers Nobody Else Did
Everything You Need to Know About Franchise Law
Marketing

What Is a Brand Personality? Here's How to Develop One.

Connect with your audience on a deeper level by giving and cultivating your brand a personality. Read here how to do so.

Business Ideas

55 Small Business Ideas To Start Right Now

To start one of these home-based businesses, you don't need a lot of funding -- just energy, passion and the drive to succeed.

Leadership

How to Create a Thriving Workplace by Leading With Authenticity

Here's why authentic leadership is the key to building a thriving workplace.