Are you starting an online business with a small budget? That's OK. Online businesses are one of the lowest cost businesses to run - if you know what you need to pay for and where to go.

Follow these suggestions for getting your website set up inexpensively while not sacrificing quality. There are some things you need to pay for (and this will tell you how much) and other things you can do just as well for free.

STEP ONE: GETTING A DOMAIN NAME

There's no reason to pay more than $10 for a domain name, so feel free to shop around. Domains are important because they give you credibility as a business.

Free websites do not enable you to have your own domain name so instead you end up with mybusiness.freespace.com instead of mybusiness.com. See the difference? Your customers expect you to put some money into your business and this is a clear tip off that you are not doing that - and for $10, why shouldn't you?

STEP TWO: FIND A HOST

Hosting plans vary considerably. Much of what you pay for will be determined by the features your hosting account provides with its service.

Are you setting up a simple, one page site? You could probably use a low cost host for $5 per month. Do you need some extra help with templates and layout or expect a high amount of traffic or downloads? You may have to pay more but it can be well worth the extra expense to have integrated webpages already set up or to ensure your host is providing you with enough bandwidth to handle the traffic on your site.

Never use a free host, unless perhaps you want to start with a blog or similar format while you get your own website up and running. Free hosting usually means you pay in other ways - lack of a domain name or a lack of quality. Many free hosting accounts are for personal use only and do not allow commercial accounts. Try to get recommendations from others when looking for a good host.

STEP THREE: DESIGN

As previously mentioned you can find professional templates on some hosting services. These can give your website a professional polish without the expense of hiring a designer. You are limited, however, on the look you choose depending on the variety of designs available.

Templates are also available to others so your site may have the same appearance as someone else. If you need custom work done consider hiring a freelance web designer from a site like elance.com or ask a local student studying web design. Freelance sites often put you in touch with new designers who will charge less while building on their experience and adding to their portfolio.

Spending money wisely is important when starting any business, but some free services will cost you in reliability or image. On the other hand there are some cheap deals you may not hear about so don't give your hard earned money (or worse - your credit) for a service you can pay less for and get the same results.