You get an offer to invest in a friend’s business or to take a new job 500 miles away. Is it a risk to part with your money or move your household? Or are you being presented with the opportunity of a lifetime?
You can’t predict or guarantee the future. But you can take steps to determine if an offer is more of an opportunity or a risk to you. These four steps can help you form a plan so you aren’t left guessing about an important business decision.
Get Reliable Information
When you are facing a major decision, you need information from a trusted and verifiable source. It’s not a good time for a friend’s story about someone they know. You need legal or regulatory references, historical data or other evidence from an independent source. Data from a reliable source, such as a professional association or government agency, is an option.
Ask Strategic Questions
Ask plenty of questions, but make sure your inquiries focus on the goals and objectives you started with. Avoid getting bogged down in details before gaining a thorough understanding of the larger picture. Otherwise, you can be distracted from important points you need to consider.
Seek Objective Input
Use your professional or personal network to find someone with experience in whatever you are considering. Find out what worked or didn’t work, and what was learned from that experience. Make sure the person you consult does not have a vested interest in your decision to ensure getting conflict-free input.
Consider the Circumstances
What individual circumstances matter to you? Learning about others’ experiences and gathering data are fine, but no one knows your situation better than you do. You should also consider how your situation is likely to change as time passes, such as growing children or impending retirement.
Having a plan to determine if an offer is an opportunity or a risk. You can’t predict the future, but you can probably get enough information and feedback to feel confident about your decision.