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Important financial terms small business owners should know

Important financial terms small business owners should know

Sep 6, 2016

Small business owners should have an understanding of financial terms, as they are the nuts and bolts of a business operation. If you have an accountant or are handling your own financials, knowing these financial terms will help you understand how well your business is functioning. Here are a few terms small business owners should be familiar with; P and L – This is a statement, usually completed every month, will give you an understanding of how your business is running. Balance Sheet – This is an indication of your businesses assets and liabilities. This statement will provide valuable information for decision-making. Assets – These are items such as cash, real estate, land, equipment, tools, computers, and furniture. Liabilities – These are loans outstanding and monthly bills your business owns. Equity – This is the money you and any other owners have invested in the business. Bottom Line – This is the net income or earnings that a company makes for the month. Markup – This is the additional price added to the cost price. Gross Margin – This is the difference between total sales revenues and total cost of goods sold. It can be stated on a per-unit basis, in dollars or as a percentage. Gross Profit – This figure is your “Cost of sales” minus your costs directly associated with sales, such as materials, labor, and delivery. Net Profit – This is your profit after costs such as overhead, materials, wages have been...

Should You Sell Your Home Upon Retirement?

Should You Sell Your Home Upon Retirement?

Aug 31, 2016

Carefully plan out your retirement to maximize your financial standing. There have been many opinions when it comes to retirement throughout the years. Many financial advisors have told their clients to sell their home come retirement. Now, this will allow them to significantly boot their retirement income, but then there’s the human aspect that comes with it too. The impact of having to sell something that has been in your family for years on end isn’t an easy thing to do. Rather, there are other ways that you can fund your retirement account without having to sell your beloved property. Look At the Bigger Picture Even if you have noticed that your home has gained a substantial amount of value over the years, remember that every situation is fundamentally different. This being said, you should base your decision off of personal preference. Money has been a primary factor when it comes to a successful retirement. But you need to ask yourself, is it really what you want to do? Don’t just sell your home right off the bat without putting much thought into it. If it holds emotional value, you don’t need to part with it. There have been many successful retirement stories where the retiree keeps his or her house and stays in good financial standing. Sometimes, the cash doesn’t always speak in the bigger picture. The Bottom Line Every homeowner’s situation is different from one another. Don’t hastily make your decision before truly sitting down with your family and discussing it. By rushing things, you’ll only make a decision that you’re going to regret in the end. Kuba Jewgieniew is the head of Realty ONE Group, a real estate brokerage firm that has offices in California, Nevada, and...

4 Steps to prep for leaving your job to start a new business

4 Steps to prep for leaving your job to start a new business

Aug 6, 2016

Leaving your job to start your own business can be a difficult decision. Your current job maybe giving you the security without the job satisfaction that your new business would offer. Here are 4 steps that will prepare you for this new journey. Learn from others – Make sure you read and speak to as many people who have made the transition from working a regular 9-5 to starting their own business. It is important to remember that change is not always easy, but can be very rewarding in the long run. Ask for help – Look at enrolling yourself in a course, working as an apprentice or reading books regarding the industry you wish to enter. It is important that you receive the correct guidance and you are aware of the highs and lows of the business you wish to get into. Use your current job – Make use of your current job, to give you a safety net while you make your transition. Be patient with yourself and let yourself master new skills with the confidence of being financially secure. Don’t get discouraged – Working for yourself will be different to working in the corporate world. You will have to work extra long hours and sometimes receive much less pay. Therefore, you should try to measure your success ways other than in monetary terms, for example,...

4 Hot jobs that pay more than $150K

Most people believe that a 6 figure salary is out of their reach. However, here are 4 hot jobs that will get you that paycheck you have been dreaming of. Anesthesiologist – Being a doctor maybe out of your reach, however choosing a career as an Anesthesiologists can earn you a upto $400,000. You will need 4 years at the undergraduate level with four more years of medical school. This should be followed with four years of residency and a fellowship for another year. Nurse Anesthetist – If putting in so many years in med school seems daunting, you could choose to be a nurse anesthetist. These nurses will assist anesthesiologists and oversee patient recovery from anesthesia. Such a career will yearn an annual wage of $158,900, to $187,000 a year. You will need a bachelor’s degree in nursing and a registered nurse licensure. On top of this at least one year of acute-care experience in an emergency room or intensive care unit is a must. Chief Executive – This big paycheck of roughly $180,700, on average comes with a lot of responsibility and long working hours. You will need an MBA, but in most cases understanding the industry you are in and working your way up to the top, will be the most effective way of landing this position. Marketing Manager – As a marketing manager you will make approximately $137,400 to $171,000 a year. This job will see you organizing marketing campaigns and events. It is best suited for people who are creative and possess good communication skills. You will need a bachelor’s degree marketing, communications, business or a similar...

5 best times of year to buy a new car

You may want to buy a new car, because you want a new set of wheels, your family size changed or your old vehicle is on it’s last leg. Whatever the reasons, timing your purchase will help you get the most out of your money. Here are 5 best times of year to buy a new car; At the end of the month – If you’re in a hurry to purchase a car, wait till the end of the month. Managers at car dealerships will be more willing to offer a larger discount, if they feel that the sale will help them top up their monthly quota. When Models Are on the Way Out – When new models of vehicle comes in, dealers are quick to want to get rid of the old model. If you are comfortable driving an older model, this is the best time to buy a car. Buy at the End of the Day – Most car dealers will drop their prices at the end of the day or on a specific day of the week. It is a known fact that dealers will give their best price on sundays. Black Friday – Most shoppers are only interested in getting holiday gifts on black friday sales. However, for those who are looking to buy a new car, black friday is one of the best days to purchase one. When a Rebate Is Being Offered – Some dealers offer clear out discounts on certain models on specific days of the year. Speak to a known salesperson about sale...

4 Tax mistakes made by millennials

Millennials are the age group that are now in the twenties and mid thirties today. Most of these age groups are evolving from graduates to independents to spouses. These are some important milestones and this group should be aware of the standard financial commitments that come with these major milestones. Here are 4 tax mistakes made by millennials. Filing as a dependent when you’re independent (or Vice Versa) – When filing your taxes and choosing your status, be clear on if you receive any financial assistance from your parents. If your parents claim you as a dependant on their tax return, you will be unable to claim an exemption on your income tax return. On the other end, if millennials file as a dependant, instead of an independant, you will not be able to reduce your taxable income. Skipping Out on Health Insurance – Under the new health care law, millennials without health insurance, will have to pay a penalty when filing their returns. Those who can afford insurance and have not, will have to pay an individual shared responsibility payment. Forgetting to Deduct Student Loan Interest – To encourage higher education the US government gives students with loans, a tax break based on the interest that has been paid over the year. The deductions and credits can reach up to $2,500 on qualified student loans. Miscalculating Deductions for the Cost of Relocating – If you have moved jobs due to a promotion or a relocation to a new office, you will qualify to deduct relocation costs. But remember that your new workplace must be at least 50 miles from your old home compared to your old job and old...

5 personal finance tips for women

Women should feel secure and confident in handling their personal finances. Here are some financial planning advice that is specific to women; Get involved – Make sure you are involved in goal setting, budgeting, saving and investing. If you don’t get involved in the setting of your goals, you will find it much harder to reach them. If you are married or have a partner, include them in the goal setting process. Have a plan – Have a financial plan for your short and long term goals. Understand what your future expenses maybe and then work out how much you would need to save to meet those expenses. Maximize your employer benefits and retirement plans to receive tax benefits. Insurance – To secure your future, ensure you are sufficiently insured. For women whose spouses are the primary earners, it is important that your partner has life and disability insurance, to ensure that you are prepared for the worst. This will keep you and your family comfortable, until you are ready to enter the workforce. Maximize social security – To maximise your social security benefits, refrain for withdrawing your benefits early. Women have a longer life expectancy than men and therefore should ensure that they have a stable income after retirement. Assess your risk – When investing your funds, make decisions based on educated facts and not on short term market fluctuations. You may find that your portfolio may go up or down, but if they are tied to your goals, you will be less likely to make reactive...

7 Ways to save money on vacation meals

You may be surprised to know that your vacation meals, can cost you more than your airfare. Here are some simple ways to cut costs on vacation meals. Cook for yourself – Book a hotel that offers a kitchenette or a mini fridge. Always eat breakfast in your room. You can stop at any supermarket and pick up some essentials, like fruit, cereal, milk, disposable plates and spoons. Eat 2 meals instead of 3 – When you’re on holiday you’re usually off your daily routine. Most days will be late starts, so have brunch and opt for an early supper at 5pm. Stock up on healthy snacks – Fresh fruit, crackers, cheese, nuts, water and milk are easy snacks to carry in your bag. Share your meals – Most restaurants serve large portions, use this to order a main and an entree and split it. If you’re travelling with children, ask the restaurant if they have a children’s menu. Look for cafes – Small cafes will provide a wide range of breakfasts, sandwiches and healthy smoothies at reasonable prices. Book a hotel that includes breakfast buffets – Breakfast buffets at a hotel usually have a variety of breakfast dishes plus a few mains. This is ideal for an early brunch. Happy hour – Many bars and pubs have happy hour from 3.30pm – 5.30pm. These happy hour offers are not only for drinks, they also include pub food such as pies, fish and chips and...