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Posted by on Nov 11, 2015 in Uncategorized |

Bad Credit? Try These 4 Tricks To Override Your Less Than Stellar Past

With the faltering economy still on the minds of many Australians and credit reports still riddled with poor circumstances, many are having a hard time finding loans and financing. It’s a catch 22; you can’t get a loan with bad credit, but you can’t establish good credit if you can’t get a loan. If you have a less-than-stellar credit rating, there are things that you can do immediately to boost your ability to get a loan and financing. Use these four tips and tricks to get the money you need.

Use online lending sources

Not only are you more likely to obtain a loan from a non-traditional lender like a third party lending site, but you can also help to build back your credit rating. There are many peer lending sites that allow you to borrow money from others in the market instead of an institution. They are willing to assume the risk involved but will charge a higher interest rate. The benefit is that once you pay off the loan on time, you can use that as proof the next time you need money. Your risk will be much lower the second time around.

Get a cash-backed credit card

There are many credit cards that are prepaid or cash-backed. Many ask why you would want a credit card if you have the cash to pay. The simple answer is that it is a great way to build a credit history. By using the card and not carrying a revolving balance, you are increasing your favorable credit usage. Make sure to use it for small purchases, increasing-over-time, and to pay it off immediately and in totality.

Credit unions

Credit unions are not technically banks, but they work very similarly to them. Credit unions are normally based on a group of people who have some association to one another. They work through non-profit organizations to provide people with the money they need and are more likely to take on riskier consumers. With so many different credit union associations to choose from, you can probably shop around to find the best deal. 

Home equity

Home equity loans are ideal because you don’t actually have to use them to gain benefit from them. They are loans that are based on the equity of your home. Your home’s equity becomes the collateral that the lending institution bases their loan and financing on. If you have even a little equity in your home, home loans can increase your overall credit rating pretty quickly.

Having bad credit can make things much more difficult and expensive, but there are ways to overcome your past. Taking the steps to build your credit profile will ensure that when you do need a loan you will be able to obtain one.

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Posted by on Aug 27, 2015 in Uncategorized |

Signs You Need a Tax Accountant When You Own a Small Business

When you own a small business, you are no doubt constantly deciding whether you’ll handle certain tasks on your own in order to save money, versus hiring someone else, like tax accountants. When it comes to your taxes, you may have been filing them yourself for many years or may assume you can just do this with a software program and be done with it. While this may be very inexpensive, it can actually cost your company money in the long run. There are other advantages to having a tax accountant handle your filing for you; note when this may be the right choice for your business.

1. You’ve expanded into new areas

If your business has recently expanded into new states, territories, counties, and so on, you want to hire a tax accountant. The tax laws in these areas may be very different and if you overlook certain deductions or fail to file certain paperwork, this can be costly. If you’ve expanded at all in the past year, have an accountant handle your taxes this year.

2. You’ve taken on investors or new partners

Investors and partners often expect certain reports and financial paperwork that go with the statements you use at the end of the year to prepare your taxes. Having a tax accountant prepare these statements and reports can mean a better understanding of your business as a whole. Investors especially expect these types of statements, and if they’re not prepared properly, you may actually lose those investors and, in turn, the value of your company may fall.

3. Tax laws that affect your business have changed

When preparing your taxes, you may see that your software program prompts you to add in certain deductions that you’re not familiar with, or you may note that certain deductions you claimed last year are no longer being prompted. You may notice that your tax bill suddenly seems much higher. No matter the change, it’s best to consult with a tax accountant. He or she will be familiar with those changes and how they affect your business and how to file your paperwork accordingly.

4. You’ve experienced rapid growth

While it’s good to make more money from your small business, you want to ensure that you reduce your tax bill as much as possible. A tax accountant can examine all your receipts and other paperwork and advise you on how to protect as much of that new profit as possible.

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Posted by on Mar 9, 2015 in Uncategorized | 0 comments

How The Value Of Key Person Insurance Is Determined

Some organisations rely on one or more key individuals in order to function. Where this is the case and there is a risk to the business if that person were no longer present, then key person insurance is called for. How is this business insurance cover calculated?

Determining True Value

Underwriters will always want to know if the method chosen to place a value on the key person is in accordance with standard practice for the industry in question. They will also determine if the approach is in line with the purpose for which the coverage is asked. Fundamentally, the coverage level proposed must reflect the true value of the person to the organisation. Assessors will take one of three different approaches.

Present Value Method

In this method, the cost involved in replacing the particular employee will be calculated. Primarily the method looks at the salary needed to find an employee as a replacement until the time when that individual is of full economic value to the company. This is then added to the training costs associated, as well as any relocation costs.

Debt Cancellation Method

This method is used if the individual in question was a guarantor in some way or if their credit standing as a director or shareholder was primary in terms of attracting credits through the trade or bank loans. The corresponding estimates are based on the amount of any outstanding loans and the average of trade credits realised, while guaranteed by the director or shareholder.

Multiple Methods

A factor is used to determine the impact that the key person has on the organisation. In other words, how much does the business rely on the individual for its success? If there are only a small number of employees and a correspondingly large number of key people, this factor will be higher. However, if the organisation already has a range of employees with special skills, all of whom are contributing towards its success, then the factor will be lower.

Once the key factor has been determined, it can be applied to a variety of other metrics. For example, typically it can be multiplied by a figure representing three times the gross profit or multiplied against annual sales revenue. The factor can sometimes be applied to liabilities.

Here, much depends on the sector within which the key person worked. A calculation applied to a gross profit may be more appropriate for a key person who is in a general management position, while a key person factor applied to revenues may be more appropriate in the case of a sales executive.

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Posted by on Feb 12, 2015 in Uncategorized | 0 comments

Tips For Hiring A Financial Planner

There are a number of reasons why very large corporations and very wealthy individuals choose to hire the services of financial planners.  However, this should not be taken to mean that financial planners are only meant for the well-to-do.

The prospect of having an independent financial planner is increasingly becoming popular with a large number of ordinary people. This is primarily because of the financial gain that advice from these professionals brings. The article below discusses a few tips to remember when in search of an independent financial planner.

Establish The Billing Rate And Understand Services To Be Offered

It is important to understand the services to expect form an independent financial planner. These professionals earn a living through commissions on the financial products they sell, as well as giving financial advice.  Before you choose one financial planner over the other, be sure to ensure that both these services are included in the service charge. Do not take it for granted that the planner will offer both services once hired.  

It is also important to understand the billing system of the financial planner. You should ask whether telephone conversations and other out-office interactions will be billed so as to avoid shock when you finally get the service charge.

Establish How To Deal With Conflicts Of Interests

There are several scenarios that may create conflict of interest between you and your financial planner. For example, a financial planner paid on commission basis alone may seem to always recommend the most expensive product available. Before you set out to choose between different independent financial planners, you need to come up with a few situations that could create conflict of interest with the planner and discuss them at length before you get into any contractual agreement with him or her.

In as much as you cannot come up with all possible scenarios, discussing a few examples will help to set the stage for how to deal with the more unpredictable scenarios that may arise.

Ask For A Gauging Mechanism

The main reason why you choose to hire an independent financial planner is that you want your finances to work for you.  There is no reason why you should not ask for a gauging mechanism from the start. The gauging mechanism will be used as a measure of the effectiveness of financial advice given and financial decisions made on the advice of the planner.  This often involves comparing performance of stocks bought on the planner’s advice and so on.  It is important to establish a gauging mechanism with your planner from the start.  

When you finally decide to get a financial planner, remember the three tips given above. For more information, contact a business such as Maddern Financial Advisers.

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Posted by on Jan 26, 2015 in Uncategorized | 0 comments

Reasons You Must Go With Fee-Only Financial Advisors

While some manage to chalk out their private financials without any external assistance, the majority still depends on professional financial mentors to guide them through the process. There are different types of financial advisors and the decision to hire a specific type usually hinges around the “value-for-money” ideology. If this is your first time resorting to third-party financial planning assistance, continue reading to understand how fee-only advisors provide more bang for the buck.

Customised Service

Fee-only financial advisors, unlike commission-based brokers and agents, aren’t tied to certain transactions and products. They don’t depend on a brokerage company, mutual fund firm or an insurance firm for income other than their primary clients. In other words, they will most likely not get swayed by any personal advantages that could come with offering certain recommendations. Their suggestions and advice are always in alignment with what the clients need and what suits them the best. This means increased objectivity and less bias.  

Fee-only advisors adopt other, more independent ways of charging such as a flat retainer or an hourly rate. They earn this income regardless of the outcome of the planning discussions; thereby giving them increased freedom.

Holistic Analysis

The primary service of fee-only advisors consists of portfolio analysis as a whole. This obviously means the advisor is adept in various asset classes, such as real estate, tax preparation or planning and retirement, college financial aid, etc. This versatility and multi-domain knowledge further translates into more reliability and expert advice.  

Time And Cost Savings

When compared to commission-based advisors, fee-only financial consultants are much more cost-efficient when viewed from a wider perspective. For instance, if you make a $70,000 outlay in an endowment with a 4% load, the commission-based financial mentor will purse $2800, which will be equivalent to more than 15 hours of portfolio analysis and planning carried out by a fee-only advisor at $180 per hour.

If put at work for 15 hours or more, a fee-only financial guide could accomplish much more substantial work that will help shape a more balanced financial portfolio, giving back a potentially loftier rate when compared to the loaded mutual investment.

Simply put, fee-only advisors offer investors the scope to extract extra service from the money spent on professional financial planning.

Conclusion

“Fee-only” and “fee-based” don’t carry the same meaning, even though the terms are interchangeably used to denote the same purpose. Fee-based advisors receive commission payments from mutual fund firms, investment partnerships and other third-party institutions, in addition to the fees paid by individual clients. Therefore, learn to distinguish between these types of financial advisors since the loyalties of fee-based advisors are clearly divided. For more information, contact a financial advisor like John Osborne & Associates.

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