Addressing the Needs of a Small Business

May 10, 2012 in Uncategorized with 0 Comments

Some say that going into business for yourself is the very definition of the American dream, and I tend to agree.  This country affords us the opportunity to access capital, a talented labor force, and necessary tools to start our business.  Though it is important to note that one out of every five small business ventures fail within the first year, but that doesn’t mean yours has to.  You just need to be proactive and address the needs ahead of time.  With a few simple tips you could be well on your way to success.

Drafting a business plan isn’t only the most important step in starting a new business, it should also be the first one!  Many people have all the desire in the world, but they fail to plan ahead of time.  You need to understand how many people you will need to employ, how much capital you have to work with, how you will obtain that capital, and how you plan to breakeven.  The breakeven point is the most crucial point of your plan.  After all, once you achieve breakeven, you then start turning a marginal profit on whatever it is you’re selling.

Focusing on your core business is another important aspect to success.  Often times companies tend to branch out into ventures unrelated to the core of their business, losing sight of their initial goals, and ultimately leading to failure.  Consider the intricacies of accounting and payroll services.  They may seem like simple tasks at first, but they can become quite complex and lead to legal issues it they aren’t addressed properly.  Hire outside services to handle these, and you will be thankful of all the money you save in the long run.

Understand where the resources for capital will be coming from, and the overall cost of capital.  These are fundamental areas that every fortune 500 company addresses at least once every year.  Will you be privately funding the business? Will you need a bank, or family loan?  If so, what is the interest rate you will be charged, and what will you have to put up as collateral?  Considering the failure rate of small businesses, make sure that you have the necessary savings to achieve success.

 

 

 

Why You May Need an Accountant

May 9, 2012 in Uncategorized with 0 Comments

Many people feel that accountants aren’t necessary anymore.  We have such easy access to lower cost ways of preparing and filing taxes these days.  With user friendly software like Turbo Tax, people don’t want to pay the extra money required by CPA’s.  These types of software walk through all aspects of your federal and state income taxes, they can be bought on CD in the store, or even accessed directly online.  In the past I often used this software prior when I filed a 1040EZ.  Now I itemize my taxes and run a small business online, and believe it or not, Turbo Tax can often be complicated when it comes to this level of detail.

Those with small businesses can actually miss a lot of deductions, or on the other hand, claim deductions that they shouldn’t.  While tax software tends to be user friendly, it can often be misleading.  This is why I tend to trust the advice of a tax accountant.  I am even able to deduct certain utility expenses, and the office space I use in my own home to run my online ventures.  The best part is that I can feel safe in case I am audited, and the accountant would be the one interfacing with the IRS, not myself.

The important of having an accountant isn’t just U.S. specific, but can be seen worldwide.  Tax law is confusing in all countries, not just ours.  Accountants London are known as accounting practioners.  In Sri Lanka, accountants are required to be members of the Institute of Chartered Accountants.  Other countries like Austria, Portugal, Canada, and New Zealand all have governing bodies that oversee the country’s local tax laws.  As the old saw goes, the only two certanties in life are death and taxes. Taxes are the governments form of pulling in revenue and they don’t take it lightly.  Make sure you have an accoutant to maximize your deductions, and to minimize your worries!

Saving – Secret to Secured Financial Future

May 9, 2012 in Uncategorized with 0 Comments

 

People do not consider saving to be important. The current generation is made to believe that saving is outdated and irrelevant. When loans are cheap and easily available, why save? This is a dangerous way of thinking and can lead to financial disaster. For a safe and secured future, we must realize the importance of saving.

Why is it important to save?

“Make hay while the sun shines”. This old adage holds true for saving also. Saving helps us to prepare for any situation. With saving, any financial crisis can be confronted. The root cause of the recent economic crisis was people’s tendency to borrow and consume. Giving up the habit of saving has proved fatal for the world economy too.

Our quality of life depends on not only our earning but saving too. If we want to maintain a good quality of life, we need to save. In old age when our source of income will dwindle, the money we save in younger age will help us to continue with the same quality of life.

Financial planning can become successful with saving. Our financial goals and aspirations can be achieved only if we save.

With saving, we can be self-sufficient and even lend a hand to our friends and relatives who are in need.

With all these benefits of saving, you should be motivated to save more and secure your future. Here are some tips that will definitely help you to save easily.

Secret to saving

Good Credit Score – Having a good credit score is also vital so saving.  Insurance companies can raise your monthly premiums just for having a bad score.  Employers can refuse to hire you, and it goes without saying that credit card companies will steer away from you.  Make sure to check out free online credit reports to verify your score at least once a year.

Budgeting – Creating a budget and following it will help you to save easily. A budget helps you to realize how you are spending your money and how you can reduce wastages. A budget also helps you to control your expenditures and stick to your financial goals.

Pay for your future – After you know your spending it is essential that you set aside a sum for the future. Create a portfolio of investment and invest in multiple channels. Make sure that you put money in pension funds too. These investments will make sure that you are prepared for the future.

Reduce your expenditure – If you study your budget for three or more months you will get a pattern of expenditures. You will find that there are several items on which you spend that can be curtailed. Shopping, eating out are few of them that can be easily controlled. By controlling your expenditures, you can actually save more.

Saving is a habit that you need to have early on. Encourage your family members to save. Very soon, you will find that you have built a strong financial base.

 

Secret to a Good Credit Score

May 2, 2012 in Credit Cards, Debt with 0 Comments

 

Credit scores have emerged to be vital for a healthy financial condition. Almost everyone knows how important it is to maintain a good credit score to get loans or even secure a good job. But do you know how to build a good credit score? Let us discuss some secrets to a healthy credit score that will see you enjoy financial abundance.

The factors that determine the credit score

There are several factors that go into deciding your credit score. Your income, the loans you have taken, your payment history and credit age are some of the factors that determine your credit score.

Income level

Your income level has a direct bearing on your credit score. With higher income, you can enjoy more credits without affecting your credit score So, try to improve your income level to have a good credit score.

The right number of credit cards

What is the right number of credit cards that you should hold? Maintaining too many credit cards will only lower your credit score as you qualify for less credit. Ideally, you should have two or three credit cards. Moreover, you should avoid taking cards whose limits increase automatically. High limits have a negative effect on your score. So, go for cards with lower limits.

Good habit of paying bills on time

It goes without saying that by paying bills in time you will create a good credit score. This applies to not only debts and loans but also bills for electricity and gases. So, inculcate the habit of paying all bills on time and enjoy a healthy credit score.

Pay attention to your payment history

Do you often forget to pay bills on time? This habit may affect your credit score adversely. We all forget to pay bills within due dates sometimes, but a chronic offender will have it reflected in his credit report. So make sure that you remember your bill dates and pay accordingly. Generally, more than one and up to five consecutive late payments will land you in the late payer list.

Keep old credit cards open

Closing old credit cards affects your credit score because those records will be removed from your credit report. By removing the credit history, your credit age will be shortened and that will make your credit score fall.

Along with these tips, you also need to check your credit report thoroughly to identify any error that may lead to inaccurate credit score. You should report the mistakes to the credit agencies and get them rectified. Building a respectable credit score is not difficult if you are diligent.

5 More Unusual Jobs That Pay Well

April 29, 2012 in Uncategorized with 0 Comments

It’s been nearing two years since I last wrote about 7 unusual jobs that pay well, but that article turned out to be one of my most popular to date.  Of course that was right after the devastating economic crash our country experienced that left many people unemployed.  Despite the improving economy and jobs outlook, there are still many people out there looking for work and to simply make ends meet.  As a follow up to the popular article, I wanted to provide all of you with 5 additional jobs that while unusual, are actually quite achievable if you are looking to make a few extra bucks.

Blogger

My day job pays quite well, and I am very fortunate to have stability and career growth.  That doesn’t mean that the appeal of making extra money is lost on me.  You’re probably thinking “blogging? nothing unusual about that”.  But how many people do you know making a living by blogging? I actually know several that I’ve met in the past couple years, but prior to that, I didn’t know a single person.  I write articles, offer advertising, and manage advertising for others blogs.  In the end, I make enough money from my online endeavors to pay my mortgage and car payment to boot.  It’s not as difficult as you would think.  You just need to commit the time and dedication to it.

Virtual Freelancer

Bloggers like me are always looking for some extra help!  Be it content writers, blog commenters, or spreadsheet creation.  Sites like Fiverr offer online services for the price of $5 a pop.  Other sites like Freelancer.com appeal to smaller companies that need to outsource tasks because they don’t have the required staffing.  As a corporate finance guy by day, I could easily offer my services up on a site like this.  There are companies in need of experienced business plan writers, strategic planners, and knowledge of month end close processes.  You can name your own price, or seek out readily available jobs that are currently posted.

Caterer

There are plenty of good chefs out there, and some of them want to work for themselves.  If you don’t like the idea of working in a restaurant all day long, but you love to cook, then starting your own catering business could be for you.  With today’s ability to market and advertise your services online, the startup costs are becoming increasingly less expensive.  You can put up ads on Backpage and Craigslist, or the local classifieds online.  All events from small parties to large corporate events need catering of some kind.  Personally, I enjoy hosting friends and family, but I can’t cook at all!  An affordable and reliable catering service would appeal to me greatly.

Real Estate Appraiser

A lot of people are familiar with real estate agents, but often times they forget about the appraisal process.  I worked for two different appraisal companies while in college, and I saw several benefits with this line of work.  The certification process only takes about a year in total, between classes and the necessary hours of experience needed.  What’s so great about real estate appraising is that many companies hire appraisers as full-time staffers, but it’s also a convenient business to work as an independent contractor.  As long as you are licensed and insured, there are a plethora of mortgage companies scrambling for quick and efficient appraisers to meet the needs of their clients.  A typical full appraisal on a home refinance or purchase runs about $400, and if business is could, you could be doing several of these a day.  You can make a pretty penny if you’re ambitious enough.

Personal Assistant

Believe it or not, there are online listings for legitimate personal assistants out there!  By legitimate I mean you need to watch out for those occasional weirdos with other tasks in mind.  Wealthy people tend to be busy people, they hired nanny’s, cook, and even personal assistants.  Search out sites like Odesk, Taskseveryday.com, and Indeed.com for these types of listings.  With tasks like word processing, dry cleaning pick up, running errands, etc., this is a job for the humbled person.  However, that’s not to say that they can’t pay well. 

Do any of you have an unusual job that most of us wouldn’t think about? Does it pay well? It is easy to get into?

 

 

 

Public Liability Insurance & the Small Business

April 19, 2012 in Insurance with 0 Comments

Part of being a small business owner is not only working to grow your business, but also being able to protect it. In order to do this, there are various kinds of business insurance policies to protect your business from potential risks. One risk that can endanger your business relates to members of the public or customers coming onto your business property. If one of these individuals should become injured or sustain damage to their property, they may file a claim against you. Public liability insurance protects you as a small business owner from such claims.
Public liability insurance can cover a variety of damages that a small business would need to pay out to the third party. This can include any monetary damages awarded to the injured party. Without public liability insurance, a small business would be forced to pay this expense out of its own pocket. This could lead to the end of the business, as these damage amounts are typically staggering. Public liability insurance will also cover any legal fees incurred by the small business for defending themselves against the claim. The legal expenses may also be incurred as the legal representation for both parties to try to negotiate an agreement.
As part of taking out a public liability insurance policy, this coverage can be extended. For instance, in some businesses, employees must go onto the property of clients. Should there be an injury to the client or their property on their own premises, then the small business is still legally responsible. For instance, if your small business is a plumbing business, the staff will be going into other homes and businesses. Should they damage property in the home, the public liability insurance would cover it. Also, if they leave a tool out and the customer trips, a claim may be made. Public liability insurance would also apply in these situations.

Personal Finance for Young Professionals

April 18, 2012 in Career, Financial Planning, Happiness, House, Income, Insurance, Investing with 0 Comments

Investing to improve your personal finance can be a particularly tricky situation and there are different roads to achieve this common goal. It is entirely dependent on you to decide how you want to save your money, but we will surely lead you to get the best routes!

Investment market is the best way to save some money as well as discover some returns. Many young professionals think of the present only and fritter away money in chase of happiness now. However, what they forget that the infinite future lays ahead when they would also need to meet other commitments in life. Therefore, it is always wise to plan for your future now and here.

Story of Dave Ramsay

You must plan for your financial stability unusually early in life. In fact, you must think about it as soon as you are out of the hallowed portal of college! You can darned well see the example of Dave Ramsay who became the youngest brokers to enter the Graduate Realtors institute in Tennessee.

Nevertheless, with the Tax reform Act initiated in 1986, Dave’s financial support began to falter. Dealing in notes led him to bankruptcy. He was not left with any finance in hand, but he was not running low in spirits. He analysed his awkward plight and put his book out called Financial Peace to assist young Americans towards financial security. Dave Ramsay has been instrumental in preaching the tit-bits of financial investing via television and radio.

In a dilemma- mutual fund or 401k plan

Most young professionals are in a dilemma as to where and how to achieve financial security. Most people will encourage them for stock and mutual funds, but before that, he must line up his salary and budget. He must organize the budget such that it is not particularly tough but is still not extremely flexible. Employers will also provide you with 401k plan, which cpuld be a compelling choice because your employer will give you the idea that will fit your availability of funds, but yet again, you must know where your money is being invested. Do not use 401K plan in the emergencies, as it would cost you penalty taxes.

Mutual funds are exceptionally strong options for people who want to invest further on. For example, a young professional can invest in small rise with calculated risks or high growth with many risks. There is the multi-sector, short-term corporate and so on investment category.

Use the credit card judiciously

Many young professionals overused the credit cards and quickly caught up themselves in the dire financial situations. Use credit card with a responsible approach and do not be trapped in the marketing gimmicks of shopkeepers.

Attain information about investing

Try to understand the distinctive schemes yourself and keep your eyes and ears open to different financial schemes to save the hefty fees of the financial adviser or broker.

Some Myths on Personal Finance

April 13, 2012 in Budgeting, Credit Cards, Debt, Expenses, Income, Investing, Lessons Learned, Make Money with 0 Comments

The best way to increase your financial stability is by doing a thorough evaluation of your savings and spending. This way you will be able to find out how you may save on your existing earning so that you may have better funding in your account. Here, are some of the common myths that you get to learn along with the rational basis or even lack of it in them.

Myth 1# Investing in stocks and mutual funds is truly necessary

Most people will inform you to invest in stocks and mutual funds. However, if you have to invest do so after appropriate assessment of your financial position. Every other person may feel a different way to invest, and there is no reason why one must only invest in mutual funds or stocks. One can make steady interests from saving accounts also by maintaining a stable balance.

Myth 2# Investing in property is better than taking on lees

Another popular myth that is passed on from one to another is that it is better buying a property instead of renting one. Often there are many cases where it is more advantageous to buy a house, but in case you are not particularly keen on your credit do not try to buy a house. The equated monthly instalments will be substantially higher than what you may actually spend on renting the same property. Again, you may obtain interests if you had invested the same amount in your account in some other place.

Myth 3# Closing credit card accounts will save money

Closing credit card accounts is yet another factor that you may do, but think about stuff like paying off the dues in regular intervals instead of in one shot. You can choose not to use your credit card instead of closing your credit card account. Moreover, you can use the card in emergency and this way you will learn to use the credit card judiciously.  

Myth 4# You cannot get a loan if you have poor credit or debit details

This is an absolute myth, and there is actually no rational reasoning in it. There are loans that are specifically made for people with poor scores. Many people take personal loans to reduce the burden of finance. This helps the person to remove personal debts and pay against only one loan.

Myth 5: I am too young or too old for retire plans

Most people ignore their retirement plans because they think they are too young, but youth is the best time to take a retirement policy.

This is the time to take action now, and if needed you can take the help of your financial adviser.

Helping Moms Make the Most of their Budgets

April 11, 2012 in Budgeting with 0 Comments

Smile

Being a mom is one of the most important jobs on the planet, so it’s only natural that you’ll want to dedicate as much time to your kids as possible without worrying about whether your budget will last until the next payday. For most of us, there are plenty of things we can do to help spend less and save more, and even though it might take a bit of planning to start with, once you get into the habit, it could make a big difference.

 

Consider investments

The phrase tax efficient savings might not be the most glamorous and exciting there ever was, but this can be a really good way to encourage savings and earn more interest. For example, a share ISA can be a great option for moms who are looking to save for the future, whether it’s for the kids’ education or a dream holiday.

 It’s worth pointing out that because this is a form of investment, there is a risk attached since the stock market can fall as well as rise, but if you’re willing to save over the long term, there is the chance to get good returns. Plus, a high risk can equal much better dividends, so it’s something worth considering. 

For the 2012 tax year, the shares ISA limit is £11280, so it offers good investment opportunities. If you want, you can save half of that amount as cash, which is less risky but is unlikely to offer as high returns.

 

Consider shopping

Shopping can be really fun, but shopping for food can sometimes be more stressful than it’s worth – and not just because the kids are throwing a strop in the cereal aisle! A little bit of planning ahead can help here. While it might not seem fun to sit down and plan meals for an entire week, this can really help you plan what you need to buy – and if you go to the supermarket armed with a list, you’re more likely to jut buy what you need and avoid those costly extras.

Also, simple things such as switching to supermarket own brands rather than fancy brand names, and making use of coupons, can save you small amounts of cash that add up over time.

 

Consider entertainment

One of the main jobs as a mom is to keep your kids happy and entertained – if only so many forms of entertainment didn’t cost so much money! Still, it’s likely that plenty of your friends are in the same boat, so you can save money on days out by pooling your resources. For example, swapping things like books, toys and DVDs can save you plenty of money compared to buying things new.

Simpler trips out, such as going to the park with friends rather than the cinema can also save a lot. Plus, you could make use of local facilities such as the library and help to support local ventures while saving yourself money on books and other activities. Many libraries also offer additional things for the kids to do, as do community centres, so looking to see what’s available in your area is definitely worthwhile.

Know the Common Mistakes with your Personal Finances

April 2, 2012 in Credit Cards, Debt with 0 Comments

Most of the times it is difficult to take care as well as keep track of the personal finances. No matter how difficult it might be; one has to stay still on their crest in order to save oneself from descending in any kind of nasty situation related with the finances. Obviously, with any rather issue that concerns the finances, one can certainly look for some or the other adviser of finance who might be honest as well to assist them. However, what would always be a better option is to manage one’s money themselves. Most of the people who have been successful in managing their own financial matters now have made some kind of error earlier while managing their personal-finance process. There are numerous errors, which happen to be so popular among people, who go through this process.

People mess their finances, let us see what the several mistakes they often make are.

By relying on the credit cards as their main source of income-

Credit cards happen to be the uncertain subjects in terms of finances, the reason being that they seem to be extremely helpful in the beginning, but they seem to be more dangerous at the end. Credit cards should not be considered as a main source of income to rely upon while paying things. As that might lead to, massive bills of the credit card, that one may not have the ability to pay back. Eventually it might cause in making one line in some or the other type of debt. The credit cards are a form of a loan. The procedure with the credit cards is like that the banks are there to lend some amount of money, it is as per the will of the person to use it provided the spent amount is returned back.

By spending the amount more than it is made –

It implies that people must try to make an effort to live their life that is within their means. As by not doing that one might anytime end up landing in debt. It is like if someone’s earning is merely $25,000 then in that case one must not try to buy a house else a car of an amount that is as large as million dollars. And not just that people must also try to keep their money. Saved money is that treasure which can always be looked back at when the hour of need arises.

Thus, one must keep in mind of not committing these mistakes while tackling your finances. Any kind of sloppy action might lead to your own financial loss!

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