Secret Every Entrepreneur Should Know: Be Comfortable being uncomfortable

Each entrepreneur is unique and goes about attaining goals in their own unique fashion. But even in their individuality, entrepreneurs all share a powerful secret recipe that facilitates business success.

Most entrepreneur guides offer the same advice – work hard, don’t give up, be creative, and other similar pearls of wisdom. But most of these guides often fail to point out some harsh truths about attaining success as an entrepreneur. One such truth is becoming a successful entrepreneur is hard and uncomfortable work, and staying a successful entrepreneur is even harder.

But the life of an entrepreneur being an uncomfortable battle with many fresh foes popping out of unexpected corners isn’t necessarily a bad thing. This is because fresh obstacles that block your path to success make you creative as you seek solutions, and can even inspire you to accomplish bigger things that you thought yourself incapable of. So instead of fearing discomfort, here’s how you can spin gold from straw by being comfortable while living the uncomfortable life of an entrepreneur;

  1. Your customer should always be priority.

As uncomfortable as it may sound, your customer should always be your priority. This means sacrificing your time, energy, and much more to ensure the perpetual satisfaction and happiness of your customers. Remember that each customer that is dissatisfied is a potential customer for your competitor. Prioritising your customers all the time with little time and resources for yourself might seem tasking but fortunately there are recommended productivity resources out there you can use to achieve some balance between work and life.

  1. Keep a close eye on your finances

Start-ups think they are only ones who are short on finances. But that’s not true. Even entrepreneurs who have made a name for themselves run into financial issues every now and then, and a lot of entrepreneurs have fallen of the ladder of success due to financial mismanagement at some point in their career. Thus, rather than celebrate your first success by getting comfortable and spending big, keep a close eye on your finances and try to minimise your expenditure.

This might seem harsh especially since most people become entrepreneurs because they want financial independence, but keeping your spending lean is actually a secret to success. You can keep your spending lean by evaluating your business and identifying which costs are necessary and which aren’t. Those that aren’t can be deferred or simply altogether dropped.

  1. Be open to fresh input

With all your qualifications and no matter how high you rise, the fact still stands that you don’t know all it takes to be successful. The day you know it all is the day you stop growing as an entrepreneur. So don’t be close minded. Rather, accept advice, feedback, and other input from all available sources – especially more experienced entrepreneurs as well as your customers.

In conclusion, the life of an entrepreneur is always unpredictable and this can throw your plans and budget out of whack. But rather than break under such pressure, get comfortable with being flexible and adapt to the circumstances. By operating this way, you are more likely to find a silver lining in every circumstance that you can exploit in your favour.

How Much Money Can You Safely Borrow?

Almost everyone carries at least some form of debt. In the first quarter of 2017, consumer debt in America hit an all-time high of $12.73 trillion. Household debt continues to grow every year, alongside federal and corporate debt. In other words, the country is swimming in borrowed capital.

This isn’t necessarily a bad thing. Debt of any kind can actually be beneficial if it’s used responsibly. Borrowed money can help save you time and effort in several situations, from buying a house, getting educated, or starting a new business. A quick loan from Cash Stop can help you meet your monthly expenses, buy that new car, or purchase a new piece of tech. Debt can certainly be useful in moderation.

By borrowing a sustainable amount, you can fund your dreams and complete important projects without messing up your credit score or your personal finances. Here’s how you can figure out how much money you can borrow safely:

Total Net worth

In order to borrow safely, it’s important to estimate your ability to pay back the loan. A crucial factor is your net worth. Your personal net worth is the estimated value of all your assets, minus the estimated value of everything you owe. In other words, it’s the net value of everything you possess.

When total debt is measured as a ratio against your net worth, it provides a clearer structure to your personal finances. As a rule of thumb, the lower the debt-to-net worth ratio, the more sustainable the debt.

While a debt-to-net worth ratio of less than 1x is ideal, any ratio below 2.5x would be considered relatively safe.

Interest Coverage

Another, and more precise, way to calculate debt sustainability is the debt-to-income (DTI) ratio. By measuring gross monthly income against your net debt expenses you can accurately estimate your ability to service the debt load.

Experts disagree on the ideal ratio of debt expenses to income. However, a good place to start is the recommended ratio for qualified mortgages.

Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, lenders, banks, and financial institutions can offer borrowers special protections and terms if the debt expenses or monthly interest payments are less than 43% of monthly gross income. This means a debt expense-to-income ratio of less than 0.43 would be considered safe. For home loans and mortgages, financial planners recommend keeping this ratio below 0.30.

In short, spending less than one-third of your pre-tax income every month on all your interest payments is financially sustainable.

Final Thoughts

The wealthier you are the more you can borrow. Your total wealth and gross income are important factors to consider when estimating how much money you can borrow. Banks and lenders have specific ratios in mind when they offer to extend a loan. Sticking to these ratios makes it more likely that your debt will help you grow, rather than put you in a detrimental, stressful position.

Investment ideas for beginners

Are you letting your money work for you? If not, you are missing a great opportunity to increase your personal wealth. Keeping money in a low interest account isn’t going to accomplish this. By choosing to invest your money in stocks, bonds or other options, successful investments will generate more cash for your future goals. Consider some of these potential investment alternatives.

Bitcoin

Different than other investments, bitcoin is a currency that can be used in a number of ways to help increase one’s wealth. The most common method is simply to purchase the bitcoin currency, anticipating it will increase in value. The currency is very popular with online websites including online casinos and at mobilecasinocanada.ca, they are considering the use of Bitcoin with other online banking methods.

Certificates of Deposit

CDs permit investors to invest their extra cash. This particular investment can vary in terms. Some CDs are short term with only three months while others can be as long as 5 years. Of course, one’s specific needs will determine the better term option. However, generally the longer the investment, the better your return on investment will be.  Shop around when looking to purchase CDs as banks do vary in regards to their rates.

Peer to Peer Lending

While this is a relatively new idea, peer to peer lending bypasses traditional banks and connects consumers looking to invest with those needing a loan. Notes are purchased by investors from websites. Borrowers must go through a thorough vetting process which helps reassure investors of repayment. Each month lenders will receive a payment consisting of principal repayment along with interest.

You may choose to try one of these investment ideas or perhaps another way to let your money work for you. No matter what you decide, one important thing to remember is that you must be diligent researching any investment prior to making it.

Types of Insurance

When going to purchase life insurance, it is important that you know there are different types out there. You will need to explore all of the types to find what is best for you. Even if you have a policy, it is important that you read your policy and understand what you have. Below is a brief outline of what types of life insurance are out there.

Term

Term life insurance is when you purchase a policy that provides you with coverage for a defined period of time. You pay a premium during that time. If you pass away before the time period elapses than you can receive the benefits, but if you claim after the time period than you can not receive the benefits. Term life insurance is known to be inexpensive and also easier to understand, making it very popular for the masses.

Whole

Whole life insurance pays a benefit for as long as you’re paying the premium. Along with the benefit, you also accrue a cash value through the years. The cash value can be used as an investment and can be withdrawn for things such as education or emergency situations but will not be distributed if not used at time of the death benefit. This type of policy is more expensive than term.

Universal

Universal life is similar to whole insurance but is more flexible because you able to increase or decrease the death benefit and cash value throughout the time period. Because of this, it is more expensive than whole insurance.

Group

When you are employed, Group Life Insurance is often a benefit offered. Group Life is basically a contract with a life insurance company which contains a group of people. This is a benefit that can cover your needs or sometimes people have supplemental policies in addition to what is offered by their company. The convenience of this policy can’t be beat. It is typically free to the employee so they get the benefit without having to do anything.

 

Advantages and Disadvantages

Each type of insurance has its advantages and disadvantages. What you think is best is based on personal preference and opinion. Many families choose to hold multiple policies of each to cover their bases. You can have more than one policy

Uses

People use life insurance for many different things. Life Insurance uses include investment, cash flow, loans, chronic illness, tax shelter, supplement retirement, enhance income, and college tuition to name a few. It is best to speak to a professional about how you can use your policy to help you.

Hopefully this information allows you to understand life insurance and the types of policies that are out there.

What You Need to Know About Setting Up an Office

All businesses of some sort end up needing an office. This can be as small as the corner of your den, an office in your home, or actual space that you lease to run your office out of. Why you need this office will depend on the nature of your business. Most offices are taking care of the administrative and financial aspect of your business. Before you decide to open an office, there are a few things you need to take into consideration.

What Size Do You Really Need?

Determining who is using the office is going to give you an indication of what size you need. If it’s just you so that you can handle your bookkeeping and emails at the end of a work day, then a simple home office will do. If you have human relations, accounting, IT, and marketing, they will indicate the leasing or purchase of your space. If you are going this large, make sure you have plenty of space for growth and stay well within your budget.

Shop for Internet

No matter what you are doing in your office, you will need internet. There are a slew of office internet providers and it takes some time to find the best ones. You are looking for a reliable service in all manner of weather. You also want a fast service so that you can get through your tasks with efficiency. It also helps to find fiber optic service rather than cable or DSL. Fiber optics are simply faster and ensure transfers of data over long distance without degrading the data. Fiber optics are not available everywhere and can be expensive to install. Be sure you can get fiber optics and that it’s within your budget.

Furnish It with Necessities

Shopping for office furniture can cause anyone to get caught up and swept away. Keep it simple and takes care of your needs. If you are leasing or purchasing a space, all of your furniture should match among the departments. For storage, get what you need plus one year’s worth of growth so that you are not constantly purchasing more filing cabinets. All chairs should be comfortable and provides support so that no matter how long you are seated, you are not straining your body too much. If your office space is carpeted, floor mats at the desks will allow for rolling chairs to move easily. If you have overhead lighting, you can avoid desk lamps.

Keep Office Equipment to a Minimum

Purchasing office equipment is yet another expense that is easy to get carried away with. Get exactly what you need to perform your duties. If you are in a home office and travel a lot, skip the desktop pc and opt for a laptop. If you are leasing/purchasing office space, desktops are more efficient for your employees. Sales teams of course would benefit from laptops rather than desktops. Printers for a home office should only include extras you use. No need to get a scanner option if you will never use it, unless the printer with the scanner is a less expensive option! Printers for a larger office space often need more bells and whistles but you can minimize how many printers you obtain. Many can be hooked into a network and folks can share the printer. One other option you can consider is leasing equipment, rather than purchasing it.

Office Supplies Are Your Friend

Office supplies can be your most costly expense in an office. Of course, you should buy exactly what you need and keep them plentiful in the supply closet. No matter what size office you have, getting a rewards card to your local office store will be greatly beneficial to help you save on your supplies. Look for those deals and watch how much waste you create. If you can avoid printing on paper, you should.

Hopefully, your endeavor into opening an office is an exciting time for you and your business. Take these extra steps to pay attention and make the most of your space without breaking your budget!

What to Do if You Owe the IRS Money

Let’s start with this: the IRS is the biggest, best resourced, and more powerful collection agency in the world. So, while I’m not suggesting that you’d otherwise try and avoid a debt to any person or organization, if you’re typically the procrastinating type that needs things to get serious and urgent before you’re motivated to take action, then please allow me to be your wake-up call: this is serious and urgent. The letters and calls won’t stop, and when the IRS threatens wage garnishment, tax levies and other collection action, they mean it. It’s not an empty threat.

With that being said, you shouldn’t feel as though your (financial) world is coming to an end, and that it’s only a matter of time before black tie and sunglass-wearing IRS Special Agents show up at your door and haul you to debtor’s prison.

According to Jeff Kahn, principal of the Tax Law Offices of Jeffrey B. Kahn and host of a weekly ESPN radio show that covers tax law and audit-related issues, here are two things to do if you owe the IRS money:

  1. Confirm that the IRS’s math adds up.

This just in: the IRS makes mistakes (and in other breaking news, water is wet, the sun is hot, and sarcasm never goes out of style). As such, start by confirming that the amount that you allegedly owe is indeed correct. Keep in mind that a single missed checkbox on a tax form can result in a deduction being denied.

  1. Minimize penalties and interest.

If you confirm that you do, in fact, owe Uncle Sam some money, and presuming that you cannot pay the full amount by the due date, your next step is to minimize penalties and interest. There are a few options here that may be applicable to your situation, including: asking for an abatement, seeing if you qualify for an installment plan, and seeing if you qualify for an offer-in-compromise (this is basically asking the IRS to settle for less then the amount owed because full payment is unlikely). Keep in mind that the paperwork required for each of these options — especially the offer-in-compromise — is complex, and most people who try the do-it-yourself route get things wrong and have their application or petition rejected.

Some Final Words of Warning

Before wrapping up: be very, very careful when speaking to IRS agents. Once again, I’m not trying to freak anyone out. But facts are facts, and you need to know that speaking with an IRS agent to get more information on your tax situation isn’t the ordinary call center “how can I help you today?” conversation that you’re used to. While you aren’t under oath or giving a deposition, anything you say — including the questions you ask — can and will be used to trigger a deeper examination of your filings (the IRS can go back much further than three years if they suspect fraud or tax evasion). And in extreme cases, your matter might be referred to the IRS’s Criminal Investigation division for potential prosecution.

 

So yes, it’s fine to simply ask ordinary questions (e.g. “where can I find this form?”), but anything else should be handled by your tax attorney — not by your accountant, whose conversations with you and work product isn’t protected by attorney-client privilege.

Things You Should Shop Around For

Every little bit counts when it comes to money. It is so important to save when you can because that money you are saving can eventually add up to something. Besides cutting  back on spending or analyzing your monthly budget, there are some big ticket items that can be shopped around for to help you save.

Insurance

Insurance is needed for many things. There are many brokers who offer these products. To save money, it is best to shop around to find the best possible price so you can get cheaper car insurance . The trick I have used is to take your current policy and just provide it to multiple agents and ask them if they can beat it. Send it around and you will be sure to get your current policy for cheaper. Unfortunately this business is just like many others and the agents are just trying to make the most they can. If they know they can win your business they will be happy to offer you a competitive price.

Credit Cards

Credit Cards are definitely a product that should be compared for optimal benefit. Do not settle on just any one. Often times offers can be sent in the mail or you can simply google the type of credit card you are looking for and look for the best offer to meet your needs. The Best ones, depending on your needs, may offer good reward incentives, low interest rates, free balance transfers, etc. Many cards out there offer great rewards from travel, to cash back that you could benefit from. Be sure to shop around.

Cars

The car industry is known for their negotiations. People can experience both extremes of the business, they can either get themselves a really good deal or totally be worked by a dealership. Car salesmen are good at their jobs and will do anything to meet their sales numbers. The most important tip for buying a car is to be able to walk away. They do not like to lose deals so you are at an advantage if you simply walk away and shop around. I have literally had agents follow me out to my car and almost chase me out of the parking lot trying to get me back in the showroom. You can’t shop with your heart, you need to shop with you head. If you do this you will be able to save some major cash.

Furniture

Most people may not think of furniture as a negotiable item but it is. Any time I have bought furniture I have negotiated. Similar to cars, it is best if you are able to walk away. They do not want to lose your business and rather make the sale with less profit. I have even been to a showroom that said they didn’t negotiate their pricing but they ended up doing it for me. If you want to purchase a piece of furniture from a furniture chain, it is best to call around to different locations to see what their prices are. Each location has a different price and you will certainly get the best deal that way.

 

Hopefully these tips can help you save some and lead to further savings for your family.