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Small Business � Money & Debt � Small Business Financing Sources � What Are Internal Sources of Finance? by Dani Arbuckle Related Articles 1 Sources of Finance and Their Advantages & Disadvantages 2 The Advantages & Disadvantages of External Financing 3 Examples of External Financing Alternatives 4 Types of External Financing In order to grow your small business into a larger one, it is important to invest in it. And to invest in your business, you need access to finance. Unfortunately, external sources of finance � lenders and investors � are often skeptical of small businesses. This can leave you to rely on internal sources of finance for investing in your business. Retained Earnings Retained earnings are an easy source of internal financing to use because they are liquid assets. Retained earnings are the portion of net income that you have retained in your company and not paid out. In a small business, retained earnings are usually paid out to the owners, who often do no...

Small Business � Money & Debt � Small Business Financing Sources � Sources of Finance and Their Advantages & Disadvantages by Rob Jennings J.D. Related Articles 1 The Advantages & Disadvantages of External Financing 2 Advantages & Disadvantages of Bank Loans 3 Advantages & Disadvantages of Retained Profit 4 What Are Internal Sources of Finance? Whether you're funding a new business or trying to expand an old one, choosing the right source of financing for your unique situation can be challenging. While you can ideally choose from several options, each source of financing comes with its own set of advantages and drawbacks. No one option is better than the others in all cases. Personal Savings And Assets Your personal savings and other assets make a great source of capital. Because you already have them, acquisition costs are minimal, and you won't be paying interest on a bank loan or sharing returns with investors. The drawbacks, of course, are that if you pl...