The Financial Business Model: 5 Keys to Long-Term Success

Why do so many businesses fail to make profits and achieve their financial goals? The answer is simple because many business owners simply ignore one or more of the 5 keys to financial success. Many businesses are making sales but are not profitable. Learn how to fortify your business model and set your company up for success. Developing a financial business model provides a clear picture of your company’s financial history as well as your company’s financial future. Working from a financial business model will help to prepare your company to make better decisions for the company in the future. And analyzing your finances on a regular basis will provide you with the financial success you are seeking to achieve. Get ready to gain more flexibility and financial freedom in your company with the keys to success.

Key #1) Don’t Go It Alone
Mismanagement of finances is not reserved for start-up companies but for all businesses. Many business owners are able to produce and sell their products and services but are not able to manage their finances. If you are not able to determine where you have been you will not know where you are going. Accountants and bookkeepers are able to assist your company with establishing a financial foundation and making predictions surrounding your financial future.

Key #2) Review Historical Data
By developing a financial history of your company’s finances provides you with valuable lessons for the present that will guide you into a more profitable future. Reviewing financial history helps you to know what to do and what not to do in your business. Compiling historical financial data can help your bookkeeper or accountant to assess the reasons for your success or failure.

Key #3) Project Sales and Costs
Once you have completed the second key it will set you on the trajectory to be able to project the sales and costs. Projecting sales and costs without historical data can be challenging but not impossible. Projections for your company are not a process that begins at the start-up phase, it is an on-going process to help determine areas of growth and change. Costs are always easier to project than sales. However, sales should not be your main focus but rather on the company being profitable!

Key #4) Develop Financial Statements
Financial statements are the framework for the accounting cycle. In other words, the income statement, the balance sheet, and the statement of cash flows provide a picture of how well your company is doing financially. Financial statements structure all financial data in a manner that is easy to understand and should be prepared with accuracy. These statements assist you with assessing financial performance and determining key business decisions.

Key #5) Assess and Implementation of Changes
This is the final piece in the financial business model. Once all of the first four keys have been established you will be able to assess your company’s financial position and implement changes where it is necessary to ensure financial growth and success. Tying it all together the financial statements will reflect your company’s historic information and decisions can be made about the future from that data.

The financial business model provides clear information to assist you in making sound financial decisions that can promote long-term success. Applying these five keys to your business will set your company on the path to achieving your goals and turning profits!

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Top 5 Bad Credit Fixes

There are 5 common ways to fix your bad credit. Although some people may not be aware of them, these methods are nothing new and have been around for quite some time. The following is a list of the top 5 ways to fix your bad credit:

  1. Make Payments on Time
  2. Increase Available Credit
  3. Pick 1 credit card to focus on.
  4. Pick 1 thing you can live without.
  5. Stop using credit.

Why you should make credit card payments on time

There are many lenders (auto, mortgage and credit card companies) that access your credit history before making a financial decision on your behalf. One category that always gets a good looking over is your payment history, because it shows the lender how responsible you are with making your payments and making them on time. The good is if you have missed a payment here and there it is not a huge deal but if you miss payments a few cycles in a row that is not good. It is like when you are interviewing for a job and they call your last employer and they find out you were late quite a bit. On the other hand if you were late to work once every 2 months it won’t be mentioned. Same principal for making payments on time with your credit cards.

In addition, when you miss a payment you become subject to a few issues with credit card companies. First, your credit card will attach a late payment fee and in some cases they may give you a penalty interest rate. As if your life is not already hard enough, obviously there is a lot going on if you missed a payment. Then they add insult to injury with this punishment. Also you become subject to universal default where other credit cards can legally penalize you for missing a payment on a totally different card. This is not the make a bad choice and only the witnesses find out scenario, everybody finds out.

Why you need to increase your available credit

Your goal is to get out of debt and fix your credit score. You can begin working towards this by increasing your available credit. The amount of available credit is what makes so many people have bad credit scores. They have literally used up more than 70% of their available credit (for example your credit limit is $2,000 and you have $200 available). This hurts your score so much because it shows the lenders and/or credit card companies that you do not have enough cash and you need to rely on using your credit card. So, if you pay down your balance and increase your available credit, you send a different message to credit card companies. Eventually, your available credit increases in 2 ways: by you paying the balance down and the companies will usually extend your credit line while your paying down your balance and based on how long you have had the line of credit.

Why you need to pick 1 credit card to focus on

It happens all the time, people get motivated and do drastic things that are not helpful in the long run. For example you commit to losing weight and you exercise for 2 hours the first 2 days, but by day # 3 you are sore and exhausted so you stop working out. This happens with paying off credit cards. People get extra money and instead of paying off 1 card they make payments on 3 credit cards. Although they reduce the balance on all of them at the end of the day they still have 3 credit cards instead of the 2 they would have by focusing on 1 card at a time.

Why you need to pick 1 thing you can give live without

Getting out of debt is about sacrifices and not wasting money. Some people have to keep up with the latest trends and place themselves further in debt. I have done it too and then it hit me by iPhone 6s plus. I was buying new iPhone after new iPhone and then I realized I do not have 1 iPhone that is not in mint condition. They all can play the same games, display the same apps etc. so I am wasting money buying a new iPhone every release. I won’t buy the iPhone 7!

Another example is coffee, I learned that kcups are not economical they are just quick and convenient. I also learned that $2.50 for a venti at Starbucks every day is of $14.00 and a 32oz bag of Starbucks Dark Roast is 17.00 at BJs. Before I learned about BJs I was paying the 2.50 but I thought I was doing it right because I was using my cash back debit card! However, the Bjs bag is much more economical.

Why you should stop using credit cards

I increased my credit score (FICO score) tremendously a few years ago just by not using my credit cards for a few months. I recently wrote a blog about it because it was around this time a few years ago where I noticed the big bump in my credit score, I had finally joined the 700 club! Additionally, the interest on credit cards even if it is low is ridiculous. In my state we complain all the time about taxes on products, well credit card interests rates are a bit higher than taxes. Lastly, if you do not pay off entire balances by the end of promotional periods your balance nearly doubles.

Bonus #6 Hire a Credit Repair Agency

Here is a bonus the number 6 way to fix bad credit is to hire a credit repair agency. By law you are entitled to a free consultation from credit repair agencies. According to the Federal Trade Commission (FTC) the Credit Repair Organizations Act requires consumers of credit repair services to receive a copy of their legal rights and it protects customers from being charged prior to services being performed. The resources on this page will elaborate in more detail about this law.

In closing using the methods listed above will certainly help anyone’s credit score improve. Making Credit Card Payments on Time, Increasing Available Credit, Picking 1 credit card to focus on, Picking 1 thing you can live without and Not using credit cards are the most commonly used ways to fix bad credit. When in doubt contact a credit repair agency and make sure you understand the terms that you are agreeing to.

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The Top 3 Export Credit Financing Mistakes Businesses Need To Avoid

Any type of business requires funds to sustain their day-to-day operations. Import and export companies face the same situation as well. Fortunately, there are various export credit financing solutions that importing and exporting businesses can rely on. With these solutions, these businesses will have fewer worries regarding the funds they will need for their operations.

To be successful in acquiring and getting the most out of these export credit financing solutions, it is important to avoid certain mistakes. These top 3 mistakes you have to avoid are:

1. Failing to fully understand your credit utilization ratio. Banks and financial institutions may examine the existing debts you have on your business’ books to see if your current and projected cash flow can handle taking on additional debt. You can avoid getting a rejection from these establishments by learning beforehand how to calculate both your personal and business’s credit utilization ratios (the amount you owe compared to your credit limit) before applying for a new loan or any type of financing option. Financial experts say that a good rule of thumb is to keep your utilization rate below 30 percent for both overall and for each revolving credit line.

2. Not calculating your annual percentage or APR. There are many numbers and fees involved with any financing offer. Interest percentage rate, daily debits, and service fees are just some of these numbers. You can understand and make sense of all these numbers by first calculating the APR of your offer before signing any contract. The APR pertains to the true cost per year of borrowing money and is usually higher than the advertised interest rate. It takes into account the interest rate and compounding effects as well as any additional fees and charges. As such, it is essential to ask about the APR when looking at loan offers. If you can, learn how to calculate it yourself. If a bank or financial institution won’t give you the information you need to calculate the APR, they may not be looking out for your best interests and it would be best to consider another company.

3. Not asking for feedback from banks or financial institutions that rejected your application. Lastly, if one of your financing applications is rejected, don’t give up easily. Ask the institution for feedback and make an effort to learn from the process. Business financial consultants say you should politely ask for an explanation of the lender’s decision to see what and how you can improve for your next attempt.

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Dating Tricks To Find Your Credit Score Match

This could be a result of many factors. For instance, people with similar credit scores are likely to be in similar income brackets and as a result have similar tastes and habits. And, people who have similar credit scores (whether low or high) are also likely to have similar attitudes to life. Think about it. If your partner is scrupulously obsessed with keeping their credit score perfect and you on the other hand are a little more relaxed on the subject, having missed a few payments here and there – you’re likely to have pretty different personalities.

Bearing all this in mind, we have created 7 handy first date tricks to help you to find your credit score match. Read on to take advantage of these handy romantic (and financial!) hints.

Talk about mortgages.
OK, now mortgages may not be the most romantic topic on the face of it, however they are linked to several deeper aspects of our lives. For instance: do we want to settle down? Are we a homeowner? Do we want to share a home with someone we love, or would we rather travel the world with them? A negative credit score can affect your chances of getting a mortgage, and so why not approach the issue by talking about deeper topics such as whether you and your date see yourselves settling down in a love nest in a couple of years’ time. Now that can be a highly romantic topic of conversation!

Talk about marriage.
Did you know that if you are married, your partner’s negative credit score can affect your own? Discussing your respective attitudes to marriage on a first date is a good way of establishing whether your potential partner values stability – both financially and romantically. After all, these two types of stability often go hand in hand.

Check in with them about their past regrets.
Asking someone what their biggest regrets are is actually quite a common first date question! It’s away of getting to know someone. Sometimes, those regrets will be financial ones – debts got into, loans taken out for projects that headed off track. Or, maybe your future lover regrets being too careful with their money! Whatever answer you get to this question, you will be able to move on to ask them about their credit score if you like, or simply use the discussion to gauge their attitudes to risk and reward more generally.

Talk about careers.
Are you both members of the precariat? You can bond over that! Or, maybe you both work in the same financially stable profession. Either way, talking about your career prospects, hopes, and pasts is a brilliant way to get to know each other – and each other’s credit scores.

Ask what they would do with a large sum of money.
If you won the lottery tomorrow, what would you do? This is such a common first date question. If your date says ‘use the money to pay off all of my considerable credit card debts’ or ‘haul myself out of bankruptcy’, then you may get a fair idea of their credit score! Of course, if someone has a poor credit report repair, that does not mean that you should not date them at all – all this indicates is what their attitudes to life are like, and whether they match yours.

Ask them how organized they are.
Another great question which helps you to get to know both your partner’s personality and their credit score. If someone is very disorganized, they may find it hard to keep on making payments on time to their various creditors. A super organized person will usually be on top of their credit and their finances.

Just ask them about their credit score.
If you want to be honest with your date, why not just cut to the chase. Ask them what their credit score is like, and divulge yours too if you feel like it. You could open this conversation by saying ‘I just read a fascinating little article about how to find your credit score match on a first date… ‘

In conclusion, asking someone about their credit score on a first date is a great way to find out if you guys will be a good match in the longer term. And, you do not need to do so in a blunt way if you don’t want to: ease into the conversation with a discussion of general topics such as life plans and attitudes to money.

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Handle Your Finances With Care

It takes years to gather a handsome amount of money, and if it is not handled properly, your most prized possession would soon escape from your hands like sand. This is the reason why people go for financial planning. It gives you a great sense of satisfaction when you know that your money is in safe hands and is being handled with utmost care.

However, not many people are aware of the process involved in financial planning. Based on your financial position, it is very important to go ahead with personal planning because if you don’t start planning well in advance, then you might face several challenges in the future.

Financial advisors suggest all individuals follow these six basic key principles for financial planning.

• Analyse your current financial status: To be able to plan for future you should first be very confident about your current financial position. Make a checklist of all the assets and liabilities and your income and expenditure. Having this information at hand, you would be in a clear position to understand how you can achieve your financial goals. Your total financial worth would help you to determine the ways to accomplish your set goals, which include paying for your children’s education, buying a new property or being ready for any financial emergency like the loss of a job.

• Chalk out your financial goals: In order to accumulate wealth, a lot of planning has to be done in order to achieve the desired goals. Setting goals would give you an urge to go ahead to achieve it. Your list of financial goals should be very specific, which would show that they are crystal clear in your mind.

• Plan for alternatives: You cannot expect your planning to go as per your wish, so you should always have a plan B at hand. After listing down your goals you plan for alternatives as well.

• Analyse the alternative options: You should ponder upon the feasibility of the alternative ways taking into account your social, personal and economic condition at present. The liquidity of your assets also matters in this regard.

• Creation and execution of your financial plan of action: Once you have planned about your alternative options and have analysed its feasibility, it is time for you to put these plans into action.

• Review your plan: Since financial planning is very dynamic process it is subject to change at any moment. So, it is always advisable to keep reviewing your plans every now and then.

Thus, in order to achieve your financial goals successfully, these basic points should be kept in mind for better handling of your finances.

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Reasons Why Online Bill Payment Is a Must

There was a time when people did not feel at ease with paying their bills online. Most of them find it hard to trust the security of transacting on the web, and thought they have no control over their money with online bill payment. When you submit your checking account details to your insurance company or utilities provider, there is a risk that you could be overbilled or that your identity could get stolen. It seemed safer to write checks and stamp envelopes, which is why many people stick to that practice.

However, this is no longer the case. More individuals are paying almost all bills you can imagine online – like credit cards, loans, mortgages, rent, tuition and utilities, to name a few.

Why then should you choose to pay your bills over the Internet? As a start, you will be able to save on time as well as costs of postage and late payment charges. Also, paying online is safer than through snail-mail. Your personal details are more prone to risks like theft when on print and in motion via the postal system. When you pay your bills with your credit card, it is easier to monitor your finances and, furthermore, you can save airline travel miles as well as win cash-based rewards.

There are three simple ways to make an online bill payment: via your bank, on the website of the biller or through a third-party. Each comes with pros and cons so the method you decide on depends on your personal choice. There are good reasons why you should move forward and pay your bills online.

Whenever online bill payment comes to mind, you might think it involves setting up automated drafts from your bank account to pay your bills. However, more and more people are choosing to pay their bills online using their credit cards. More merchants, as well, accept credit card payments online, so if you prefer to pay your bills – including mortgage or rent – using your plastic money, you can do it.

Without a doubt, online bill payment is easier and quicker than check and snail-mail method. Essentially, it gets rid of issues involving procrastination. You do not need to worry about forgetting that your bills are way past their due date. You can arrange a monthly payment schedule via your bank or billing company and therefore, always pay on time. Even if you pay your bill online every month rather than do automatic payments, you can still save on time, stamps and disappointment. Granting you are paying online at the last minute, you still save precious time because online transactions are faster than processing mailed payments.

Once you are online, you could possibly face the risk of hacking, viruses and spyware (automated payments reduce these risks), but there is a considerable risk when it comes to mail theft. It is better to avoid mailing paper statements, personal information and checks. Moreover, when you make an online bill payment, you always have an option if ever there is a dispute because you can track records of paid amounts and pay dates.

Therefore, in contrast to the former belief of other people, online bill payment is a lot safer than snail mail, coming with additional protection whenever you pay your bills with a credit card.

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How Closing a Credit Card Account Affects Your Credit Score

Do you remember the excitement surrounding your first credit card? You probably applied for a credit card when you went to college or maybe your parents offered some advice. Either way, you’ve had that card since your teens or early 20s and it’s probably not the greatest card in your wallet. It might have a high interest rate, no rewards or a lofty annual fee.

Once you starting building good credit you were likely offered better credit cards. Your interest rates are lower, you probably don’t have an annual fee or a it’s a low fee, and you probably have access to airline miles or cash back rewards. So, why keep the card that is no longer serving you?

How will closing the accounts affect my credit?

The important thing to remember is that when you make the decision to close a credit card account you’re reducing your credit utilization rate. Remember that credit utilization accounts for 30 percent of your total score calculation. You’ll need reduce your spending habits when you close a credit card account or you’re likely to go over the recommended 30 percent utilization rate causing your credit score to take a nose dive.

The average age of your credit accounts is another important factor for your credit score. This is two-fold. If you’re newer to credit, it’s best to keep old cards open because they remain on your credit for 10 years. That card, though rarely used, is actually helping your credit – especially if you have good payment history. Closing it could hurt your credit far worse than someone who has been building their credit for more than a decade.

So, what can I do?

If you have a high interest rate or a large annual fee, try negotiating with your credit card provider. Sometimes if you tell them you are considering cancelling the card due to high fees, etc, they may work with you. It costs them far more money to acquire a new customer than it would cost them to waive your annual fee or lower your interest rate.

Sometimes you have to close a card. If it’s costing you money because the credit card company won’t negotiate a waived or lower annual fee, it doesn’t make sense to keep it. Your credit might take a hit, but it will recover. You can’t however, recover lost funds due to annual fees for a card you don’t use.

Closing a credit account should not be taken lightly. Make sure to consider the factors listed above before you close your accounts.

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My Tips on Improving Your Finances for Life

There is no way to avoid dealing with money and finances these days. Therefore you should try to learn as much as possible to help you make good financial decisions and to increase your confidence about money.

When you make a budget, it should be realistic regarding your income and spending habits. Be sure to include all of your income such as alimony, child support, rental income, or any other. Always use your net income not your gross earnings in these calculations. Once you have the numbers, you can consider how to adjust your spending to stay within your income range. To maintain your budget never exceed your incoming cash flow.

The next step is to total up your expenses, and you should make a list of all monthly expenses. Your list should document each and every expense that you have whether it expense, spontaneous or just a one time expense. Remember that this list needs to have a complete breakdown of your costs. Be sure to add in expenses that you have from restaurant dinners and fast food as well as grocery bills. Reduce expenses linked to your cars, such as gas and insurance. If you have payments that you make quarterly or less frequently, divide them up to reflect a monthly payment. Make sure you include incidental expenses, for instance, baby sitters or storage unit rentals. Try to have the most accurate list possible.

Now that you have a good idea of your income and expenditures, you can start planning a new budget. Look at each expenditure on your list, and decide what you could do without. If you normally buy coffee from a cafe, calculate how much money you would save on a weekly basis if you bought it from McDonald’s instead, or made it at home. Exactly what and how much you are willing to compromise is completely up to you. The first step is identifying expenses that are not necessary so you can use the money for something else.

If your utility bills are rising, you may want to upgrade your appliances to save some money. Upgrading to well-fitted double-glazed windows, for example, can reduce your heating bill dramatically. Besides you can repair any leaky pipes and only run the dishwasher with a full load.

Swap old, inefficient appliances for those that use less energy. Although doing so may cost you some money upfront, over the long-term you will save a fair penny on your utility bills. Unplug the appliances you do not need. In time you will notice significant savings in your energy consumption.

You can make a significant decrease in your heating and cooling bills by improving your insulation, as well as the roof above it. Insulation or roofing issues can be very costly, as maintaining a regular temperature in the home can be expensive. If you invest in the upgrades, it will save you a lot of money in the long run.

Using these tips not only saves you money, but it also helps you start bringing your budget under control. An expensive upgrade can save a lot of money in lowering electricity or water bills. This is one way that you can make your budget more reliable.

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