When you first start a new business, you are going to need a lot of equipment. Whether it’s new computers for the office or advanced medical technology for the med spa, it’s a necessary part of making sure that the small business gets off to the right start. But how are you going to afford to get that equipment?

There are two basic options for acquiring the equipment you need: getting an equipment lease or getting a small business loan. Many people automatically assume that small business loans are the way to go when first starting out but you might find that you can save yourself money (and problems with credit) by leasing your equipment instead.

When you lease equipment, you avoid the high interest rates that are associated with many business loans. Additionally, you give yourself an opportunity for reserve money since you’ll be able to access those loans for something more necessary down the line. And finally, you give yourself flexibility since you aren’t required to commit to keeping the equipment if you determine that it’s not right for your business.

Businesses that need only a minimal amount of equipment and which are certain about the equipment that they need may find that loans make sense. They can pay off the debt and be done. However, new businesses that are just getting settled may find that the benefits of leasing their equipment outweigh the benefits of a loan.

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