So, to determine how much money you should have to start your business, summarize all of your anticipated starting costs, then add the working capital required for one year as determined by a one-year cash flow projection that is part of your business plan. If you do not have a one year cash flow projection, consider using the free, easy cash flow format available on the non-profit website www.myownbuiness.org.

Once you know how much you need, consider the following options for starting a business:

Personal savings: You should not borrow money if you can help it. So, go to your personal savings first and foremost. You can think of it as your primary source of funding, but sometimes you have a good business idea, and you do not have a good amount saved up. If you think you want to start your own business, start saving now, and be as frugal as possible, as not learning to be frugal will make it difficult to start a business.

Friends and family: If you are going to start a business, and you have to get a loan, think about how much loans cost, and look to your cheapest options. Usually, borrowing from relatives or friends with money is a fairly easy process and a cheaper way to borrow, as long as you can make repayment and not alienate family and friends in the process.

Credit cards: Personal credit cards can provide an easy to get money source, and the loan is unsecured so you are not putting anything at risk by using this money, but it is expensive to use credit cards for funding a business.

The Small Business Administration's loan guarantee programs: The SBA is offering guarantee programs that will help you find a way to make bankers happier with you and more willing to lend you money, but to take advantage of this you will want to contact your closest SBA office or go to www.sba.gov.

Of course you can go the traditional route, and get a small business loan, however you have to have great personal credit, a solid business plan, and a way to pay the loan back in case your business idea is not successful.

No matter what you do, there are things that you should not do when it comes to borrowing money to start a business. It's not a good idea for entrepreneurs to take out home equity loans to start a business. If your business fails, you do not want to lose your home. Do not settle for loans with poor interest rates, or that have bad terms just because you are desperate for money, this can mean regret and high payments later.